Term Insurance Coverage Calculator
How much term insurance do you actually need? This calculator uses the Human Life Value (HLV) method to compute the right cover — enough for your family’s expenses, debts, and future goals.
Methodology. Human Life Value (HLV) approach: Term cover = (Annual income × income-replacement years × % needed) + outstanding loans + future goals – existing assets. Income replacement years = years to retirement. Rule of thumb sanity check: term cover should be 10–20× your annual income. Term insurance is pure protection — buy via online direct plans (LIC, Max, HDFC Life, ICICI Pru); avoid endowment/ULIP cover. Premiums are deductible under Section 80C up to ₹1.5L (along with EPF/PPF/ELSS).
How much cover is enough?
The calculator uses a needs-based method: the cover should replace the income your family would lose, clear your debts and fund big goals, minus assets you already have.
Cover = present value of family expenses + outstanding loans + future goals − existing investments and cover.
Worked example
A 32-year-old earning ₹15 lakh with family expenses of ₹6 lakh a year, a ₹40 lakh home loan, ₹30 lakh set aside for children’s education and ₹10 lakh of existing investments:
- 25 years of expenses, assuming investments beat inflation by 2%: ≈ ₹1.17 crore
- Plus loans and goals: ₹70 lakh
- Minus existing assets: ₹10 lakh
Cover needed: about ₹1.75–2 crore, roughly 12–13 times income. The common 10–15× income shortcut lands in the same range.
Buying tips
- Choose cover until your youngest dependant is independent or you retire, usually age 60–65.
- Pure term plans are far cheaper than return-of-premium or endowment plans.
- Disclose health and lifestyle details honestly; non-disclosure is the main reason claims are rejected.
- Individual life insurance premiums are exempt from GST since 22 September 2025.
Our full guide on how much term insurance you need covers pricing and choosing an insurer.
FAQs
Is employer group cover enough?
No. It usually ends when you leave the job and is rarely more than 3–5 times salary.
Should a homemaker have cover?
Yes, to pay for the childcare and household services the family would need. Insurers cap it, often at ₹50 lakh–₹1 crore.
Figures last checked October 2026. Calculator results are estimates; actual lender, fund or tax outcomes can differ.