Estimate term cover: buffer, project costs with inflation, discount at expected corpus return, add loans. Nominal sum in the breakdown for comparison.
Explore tools that pair well with this one—loans, investing, and planning.
Term insurance pays your nominees a lump sum if you pass away during the policy term. This calculator follows an expense-replacement approach: you choose how long dependents need support (cover until age), optionally pad today’s annual expenses with a buffer, project household costs year by year at your inflation rate, convert that stream of future costs to a lump sum today using your expected return on the corpus, and add any outstanding loan balance. That suggested cover is a planning ballpark — not a quote or guarantee.
Annual expense today = 12 × monthly expenses. Starting annual need = today’s annual × (1 + expense buffer). Each year’s nominal need grows at inflation until cover-until age. Present value of that stream at expected corpus return r: discount each year’s cashflow by (1+r). Suggested cover = present value + outstanding loans. The breakdown also shows the undiscounted nominal sum of the same cashflows.
Enter your age, cover-until age, monthly living expenses (no EMIs/investments), expense buffer, inflation, expected corpus return, and outstanding loans. Review the breakdown, then the suggested sum assured.
Loan repayments are handled separately via the outstanding loan field. Double-counting would inflate your cover. Some approaches add EMI capacity into expenses — here we keep living expenses and loans explicit.
The suggested sum assured is the present value of your projected annual expenses (after a one-time buffer, growing at your inflation rate until your cover end age), discounted at your expected corpus return, plus outstanding loans. The breakdown also shows the undiscounted nominal sum of those same annual amounts for comparison. Insurers apply their own underwriting rules and may require income proof.
It is a one-time percentage increase on your starting annual expenses before we project year by year. It stands in for costs that are hard to model up front (e.g. children growing, lifestyle changes), similar to how some term-cover articles describe adding a buffer before summing projected expenses.
If you pass away, dependents may need to clear unsecured or other debts you listed. That balance is added on top of the present value of projected living expenses.
This is an educational estimate. Actual offer limits depend on insurer guidelines, income multiples, and medical underwriting. Compare with a licensed advisor or insurer.
It is the nominal annual need in the final year of your protection window: your buffered annual expense, compounded by your inflation rate for each year until the last year.
Use these notes to stress-test the calculator, understand what drives the result, and choose the right tool for the decision you are making.
This estimate is based on an expense-replacement method, one inflation rate, one expected return on the surviving corpus, and one coverage horizon. It does not replicate insurer underwriting rules, income multiples, or household-specific estate planning constraints.
A family with 50,000 in monthly living expenses and an outstanding loan may need a much larger cover than a simple income-multiple rule suggests, especially if the support window is long and inflation is high. That is why projecting expenses explicitly can be more informative than using a blanket multiple.
Think of the suggested cover as a planning range starter. If the number is far above what insurers typically offer for your income, that is a cue to review assumptions, existing assets, and the share of expenses that actually needs to be replaced.
Insurance needs change after marriage, children, mortgage changes, and career shifts. Revisit the estimate after major life events instead of treating today's result as something permanent for the full policy term.
“The stock market is a device for transferring money from the impatient to the patient.”
— Warren Buffett
