Understanding Your Insurance Need
Most Indians are either uninsured or severely under-insured. The right amount of life insurance depends on several factors including your annual income, outstanding debts, number of dependents, and future financial goals.
The Human Life Value Method
The simplest way to calculate your insurance need is using the Human Life Value (HLV) method. This considers your current income, expected income growth, years until retirement, and annual expenses.
Formula
Insurance Need = (Annual Income - Annual Expenses) × Years to Retirement
For example, if you earn ?10,00,000 per year, spend ?4,00,000, and have 30 years to retirement, your basic insurance need is ?1,80,00,000 (?1.8 Crore).
Additional Factors
- Outstanding home loan
- Children's education fund
- Spouse's retirement needs
- Existing insurance coverage
- Emergency fund requirements
Our Recommendation
Use our free HLV Calculator to get a personalized estimate. Then book a free consultation to discuss the right plan for your situation.