People are always grappling with what is the best sum assured figure for their term plans. In this piece, you will see how it is a question of simple mathematics if you know what to calculate.
Here are the three most important things to consider when buying a term insurance plan:
- Is it covering your immediate loans and liabilities?
- Is it covering your children’s primary and higher education?
- Is it covering your household expenses like monthly bill of groceries, maid servants, driver, petrol, and so on?
Your term plan’s sum assured needs to cover the mentioned expenses. If it is doing so, you can relax – you are adequately covered. It’s really that simple!
In case you are wondering how to calculate primary and higher education expenses, look no further:
- Calculate your children’s current annual tuition fees and multiply it by 6, 8, 10, or any number depending on which standard they are in currently.
- For higher education, note the current fees of the course and multiply it by around 2.5 for every 10-year period. For example, if MBA costs 15 lakhs now, it is going to cost around 40 lakhs in 10 years’ time. This is the inflation-adjusted figure.
Beyond this, if there are further queries, our team of insurance experts, who eat, drink, and breathe insurance are at your service at email@example.com or 86559-86559. Feel free to reach out to us.
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