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How Much Insurance Do I Need?

Two numbers from one set of questions: how much term life cover your family needs if you are not there, and how much health cover to buy. Every figure shows where it comes from.

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Calculator and results

You may need about ₹1.75 Cr life cover (rounded up from ₹1.6 Cr) for 25 years (until age 60) and ₹10 L health + ₹25 L super top-up.

These are calculated options, not financial advice.

Life cover
yrs
yrs
₹
₹
yrs

The family is supported until this or your retirement, whichever is later.

₹
₹
yrs
₹
yrs
₹
₹
%
%
Health cover
yrs
₹

Life cover

₹1.75 Cr

rounded up from ₹1.6 Cr; term plan until age 60

Health cover

₹10 L

family floater

Super top-up

₹25 L

deductible ₹10 L

Income check

₹1.8 Cr–₹2.7 Cr

10–15× income, a rough check only

Where the life cover figure comes from

Family expenses₹60,000 a month for 25 years, rising 6% a year, in today's money at 7% return
₹1,59,68,155
Loans to repayOutstanding today
₹30,00,000
Children's education₹40,24,393 when needed, in today's money
₹17,86,879
Children's marriage₹48,10,703 when needed, in today's money
₹12,43,177
Total need
₹2,19,98,211
Less existing cover and savings
− ₹60,00,000
GapThe suggestion rounds this up to the next ₹25 lakh
₹1,59,98,211

Suggested: a term plan of ₹1,75,00,000 (rounded up from ₹1,59,98,211) for 25 years, until you are 60. The 10–15× income figure is a common rule of thumb; your own needs above are the better guide.

Health cover suggestion

A family floater of ₹10,00,000 with a super top-up of ₹25,00,000 (deductible ₹10,00,000).

  • Metro hospital costs set the starting point.
  • Employer cover is not counted: it usually ends when you change or leave the job, and may be lower than it looks after sub-limits.

CalcMate planning assumptions: a base cover sized for an ordinary hospital stay in your city, plus a super top-up for a large bill. They are not insurer or IRDAI figures.

Section 80D (old regime): premiums for yourself, spouse and children up to ₹25,000 a year (₹50,000 where the person is a senior citizen), including up to ₹5,000 for preventive health check-ups. Not available in the new regime. Source

Premiums vary by insurer and health; get quotes. The IRDAI site has guidance for policyholders.

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Life cover

₹1.75 Cr

+ ₹10 L health
What it is:
A tool that suggests how much term life cover and health cover a family in India may need.
What it calculates:
Recommended term cover and its term, with a full breakdown; a base health cover, super top-up and parents' cover; Section 80D limits.

Key Assumptions

  • Expenses rise with inflation and the payout earns the expected return.
  • Goals are entered in today's money.
  • Health cover amounts are CalcMate's planning assumptions, not insurer figures.
  • Section 80D limits are for the old tax regime.

How does the How Much Insurance Do I Need? work?

Life cover is the money your family would need: your household expenses for the years they depend on you, rising with inflation and expressed in today's money; your outstanding loans; and future goals such as education and marriage, grown by inflation to when they are needed and brought back to today's money at the expected return.

From that need, the tool takes away the life cover you already have and your savings and investments. The gap is rounded up to the next ₹25 lakh, since term plans are sold in round amounts. It never goes below zero.

The suggested term is until you retire or your youngest dependant is independent, whichever is later. The common 10–15× income rule is shown next to it only as a rough check.

Health cover starts from a base family floater for your city, adds more for a family of four or more or when the eldest member is 45 or older, and adds a super top-up for a large bill. Parents are suggested a separate policy. Employer cover is not counted because it ends when you change jobs.

How Much Insurance Do I Need? formula

Life cover = PV(expenses) + loans + PV(goals) − existing cover − savings, rounded up to ₹25 lakh, not below 0

PV(expenses)
= annual expenses × (1 − (1 + g)^−n) ÷ g, where g = (1 + return) ÷ (1 + inflation) − 1 and n = years of support
PV(goals)
= goal today × (1 + inflation)^t ÷ (1 + return)^t

Health cover amounts come from one configuration file of planning assumptions, listed on the page.

How Much Insurance Do I Need?: worked example

Age 35, ₹18 lakh income, ₹60,000 monthly expenses, ₹30 lakh home loan, one child, metro

Family expenses for 25 years (today's money)
₹1,59,68,155
Loans
₹30,00,000
Education and marriage (today's money)
₹30,30,056
Less ₹50 lakh cover and ₹10 lakh savings
− ₹60,00,000
Life cover (rounded up to ₹25 lakh)
₹1,75,00,000
Health cover
₹10,00,000 + ₹25,00,000 super top-up

How Much Insurance Do I Need?: frequently asked questions

How much term insurance do I need?
Enough to replace what your family would lose: their living costs for the years they depend on you, your loans, and big goals like education, less what you already have in cover and savings. Many people end up between 10 and 15 times their income, but your own figures are a better guide than the rule of thumb.
Is employer health insurance enough?
Usually not on its own. It ends when you leave the job, often has room-rent and other sub-limits, and may not cover parents well. A personal policy keeps you covered between jobs and after retirement.
What is a super top-up?
A health policy that pays once your total medical bills in a year cross a deductible, usually set equal to your base cover. It adds large cover at a lower price than raising the base policy.
How much tax can I save on health insurance?
In the old regime, Section 80D allows up to ₹25,000 a year for yourself, your spouse and children (₹50,000 if any of them is a senior citizen), and up to ₹25,000 more for parents (₹50,000 if a parent is a senior citizen), including up to ₹5,000 for preventive health check-ups. The new regime does not allow it.
Why don't you show premiums?
Premiums depend on the insurer, your health, the plan's features and where you live. We have no reliable source for them, so we don't guess. Get quotes from insurers.

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Reviewed by Pradipta Ray, MBA (Finance) · Updated