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How much term cover should you buy, and till what age?

Checked 4 October 20262 min read

Short answer

Use a needs calculation, not a fixed salary multiple. Add the debts and future contributions your family would still need, subtract assets and existing personal life cover that are genuinely available to them, and insure the gap. Run the policy until the latest realistic date that those obligations should end—not automatically to age 99.

Add the obligations your death would leave behind

Start with a rupee list: Do not count the family home as an asset available to spend if the plan is for the family to keep living in it. Do not count retirement money the surviving spouse will need for their own old age twice.

  • Loans the family would repay rather than clear by selling the asset.
  • Several years of household spending while dependants adjust.
  • Education or care commitments you intend to fund.
  • Replacement cost for childcare, elder care or other unpaid work.
  • Final expenses and a buffer for timing and uncertainty.

Subtract only money the family can actually use

Subtract liquid investments earmarked for these goals, existing personal term cover and other assets the family would be willing to use. Treat employer group cover separately because it can end with the job. Treat expected inheritance as zero until it legally and practically belongs to the family. Recalculate after a major loan, child, marriage, divorce, career break or large increase in assets. Buying an additional policy can be simpler than replacing a sound older one, but disclose existing cover on every proposal.

End the policy when the dependency ends

The term should reach the later of the dates when dependants should be self-supporting, important loans should be repaid, and the household should have enough assets to replace your contribution. For many buyers this is around retirement, but the right age comes from the plan, not from a dropdown default. A longer term raises the premium because the insurer covers older ages. Covering age 85 for a loan ending at 52 can spend money without protecting a real dependency. A shorter term can be equally dangerous if children or parents will still rely on you.

Questions people ask next

Is ten or twenty times annual income enough?

It is a rough screening rule, not a calculation. Two people with the same salary can have different loans, children, assets and dependent parents. Use the needs list and treat the multiple only as a reason to recheck an implausibly low result.

Should I split cover across two insurers?

It can diversify servicing and future product decisions, but it also creates two proposal forms, premiums and claim files. Declare the other policy to each insurer and make sure the nominee knows both exist.

Should I choose regular pay or limited pay?

Compare the total outflow and the risk of lapsing. Limited pay compresses premiums into fewer years; it does not make the insurance free later. Regular pay keeps each payment lower but requires discipline for longer.

Sources checked

Regulatory rules and product terms can change. We checked these sources on 4 October 2026.