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How Much Term Life Cover Should I Buy?

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Commercial Vehicle

How term cover you should buy mainly depends on your annual income. The general rule of thumb states that risk cover of your term policy should be 10 to 15 times of your annual income. So it basically means that if you have an earning of Rs 5 lakh per year then you should buy a term risk cover of as a minimum Rs 50 lakh.

The idea of buying a good term life insurance policy is to arrange for self-sustainability of dependents so that lifestyle can be maintained and all the future needs of the family could be settled after the demise of a policyholder.

What you need to keep in mind in this context is that it also depends on the age. Younger age people should and can buy higher term life insurance cover – up to 25 times of their annual income. It’s simply is because their dependents will take a longer time to be on their toes. You can click here to know more about term insurance plans.

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