How Much Term Insurance Do You Really Need? A Practical Method
A common guideline is 15-20 times annual income, then adjust: add outstanding loans, children's education costs, and years of family expenses; subtract existing savings and investments.
Riders worth adding
Critical illness riders pay a lump sum on diagnosis, accidental death benefits add coverage, and premium waiver protects the policy if you are disabled. Riders are cheap layers of real protection.
Misconceptions
Term insurance is protection, not an investment - the family is covered if something happens, which is the entire point. Cheapest is not best; claim behavior matters more. Delaying purchase makes premiums costlier and underwriting stricter.
Tax benefits
Premiums deduct under Section 80C up to Rs 1.5 lakh, and the death benefit is tax-free under Section 10(10D) - among the most tax-efficient protections available to Indian families.