Many people get confused about how much insurance cover they should go for. How can you come to know an approximate insurance cover amount? Well it’s simple just ask a few questions to yourself and you will get an answer to your query.
Let’s take an example to showcase the insurance need of Mr. MS. Dhoni, at the age of 30 he earns Rs 10 lakh p.a. and has a total outstanding loan is of Rs 22 lakh (Rs.20 lakh for his home and Rs.2 lakh for his car). He has an existing insurance coverage of Rs 10 lakh and he feels his family would require at least 10 times of his current annual income in case of any unfortunate event.
In simple terms now you can determine the amount for insurance based on your families future needs and outstanding loan amount.
For this we have developed a simple tool which can help you figure out the amount of insurance cover you need: (Just fill in the fields in Yellow)
Your inputs and suggestion are welcome.
You might also want to check out your loan amortization schedule – check out the loan EMI calculator.