Term Insurance Calculator
Term insurance pays your family a lump sum if you die during the policy. The right amount is the money your family would need to keep its standard of living, clear debts and fund goals.
Results
Additional term cover needed
₹2,02,79,448
- Total protection needed
- ₹2,67,79,448
- For income replacement
- ₹2,07,79,448
- For loans
- ₹40,00,000
- For future goals
- ₹20,00,000
- Existing cover and assets
- ₹65,00,000
- Additional cover as a multiple of income
- 16.9 ×
To keep your family's lifestyle until you would have retired at 60, plan for about ₹2,67,79,448 of protection. After counting your existing cover and assets, the additional term cover you need is ₹2,02,79,448, about 16.9 times your yearly income.
Show the calculation steps
- Your family needs about 70% of your income = ₹8,40,000 a year, rising 6% a year with inflation, for the 28 years until you retire.
- A lump sum earning 7% can pay that stream: present value = ₹2,07,79,448.
- Add loans to repay (₹40,00,000) and future goals (₹20,00,000): ₹2,67,79,448.
- Subtract existing life cover (₹50,00,000) and savings and investments (₹15,00,000): additional cover needed = ₹2,02,79,448.
- A needs-based estimate. Insurers set their own limits based on income, age and health. This is not a recommendation to buy a particular product.
Replacing your income
The calculator finds the lump sum that, invested at the return you choose, can pay your family the share of your income they depend on each year, rising with inflation, until you would have retired.
Common rules of thumb
You will often see a rule of 10 to 20 times annual income. A needs-based calculation is better because it accounts for your age, your loans, your goals and what you already have.
Formula
Income replacement = PV of (income × share needed) rising with inflation for the years to retirement
Total need = Income replacement + loans + future goals
Additional cover = Total need − existing cover − savings and investments
Where:
- PV
- = Present value at the return you expect on the payout
Example calculation
Age 32, ₹12 lakh income, ₹40 lakh of loans
Inputs
- Your Age
- 32 years
- Retirement Age
- 60 years
- Annual Income
- ₹12,00,000
- Share of Income Your Family Needs
- 70 %
- Expected Inflation
- 6 %
- Return on the Payout
- 7 %
- Loans to Repay
- ₹40,00,000
- Future Goals to Fund
- ₹20,00,000
- Existing Life Cover
- ₹50,00,000
- Savings and Investments
- ₹15,00,000
Result
- Additional term cover needed
- ₹2,02,79,448
- Total protection needed
- ₹2,67,79,448
- For income replacement
- ₹2,07,79,448
- For loans
- ₹40,00,000
- For future goals
- ₹20,00,000
- Existing cover and assets
- ₹65,00,000
- Additional cover as a multiple of income
- 16.9 ×
Step-by-step
- Your family needs about 70% of your income = ₹8,40,000 a year, rising 6% a year with inflation, for the 28 years until you retire.
- A lump sum earning 7% can pay that stream: present value = ₹2,07,79,448.
- Add loans to repay (₹40,00,000) and future goals (₹20,00,000): ₹2,67,79,448.
- Subtract existing life cover (₹50,00,000) and savings and investments (₹15,00,000): additional cover needed = ₹2,02,79,448.
Important notes
- This is a planning estimate, not a recommendation to buy a specific policy. Insurers assess income, age and health, and you should compare policies and read the terms.
Disclaimer: This calculator provides estimates for informational purposes and should not be considered financial advice. Actual figures from lenders, banks and investment products can differ because of fees, taxes, rounding rules and changing rates. Consult a qualified professional before making financial decisions.
Frequently asked questions
How much term insurance do I need?
Enough to replace the income your family depends on, repay your debts and fund goals, after subtracting existing cover and assets.
Is 10 to 20 times income enough?
It is a rough guide. The needs-based amount depends on your age and obligations.
Should I buy term or a savings plan?
Term plans provide pure protection at low cost. That choice depends on your goals, so consider advice from a licensed adviser.
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- Human Life Value CalculatorCalculate your human life value: the present value of the future income you provide to your family, and the extra cover it implies.
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