How is Term Insurance Calculated?

Now protecting your loved one’s future even in your absence is just got easier with the online term insurance plan!
Wondering how much premium you need for your term insurance plan but are not sure how to calculate the coverage amount you require? Relax! This is a common situation. Rather than blindly buying a term plan, you should know how much life cover you exactly need. Else, you may end up being overinsured or underinsured.

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What is Term Insurance?

Before you take a look at how much term insurance cover you need, let us take a look at what is term insurance. Term insurance is a life insurance plan that provides coverage for a fixed period. It promises to pay a certain amount of money to the nominee upon the death of the policyholder during the policy tenure. This is a cost-effective and low-price life insurance policy.

How Much Term Insurance Cover Do You Need?

By using any of the below-mentioned methods, you can get to know the approximate value of the term insurance cover that you may need. Let us discuss these three methods in brief.

Human Life Value

The present value of your debts, profits, expenses, and savings is calculated using the Human Life Value calculator. It calculates the sum of money required to protect the beneficiary’s future through a term plan in case of an unfortunate event. Age, occupation, employment benefits, gender, retirement age, annual income, and fiscal records of the child, are the factors considered under this.
Income Replacement Value

In this, life insurance should replace the missed earnings of the sole earner. The simple way to calculate IRV is insurance life cover = current annual income X years left for retirement. For instance, if you are 40, and your annual salary is 15 lacs, the cover you will require is Rs.3 Crore i.e., 15 lacs X 20.
Underwriter’s Rule

The minimum sum assured amount requires to be multiple of yearly revenue, based on the age of the policy aspirant. Let’s say, individuals in the age group of 20 to 30 years must have life coverage 25X of annual salary, whereas those of 40 to 50 years could opt for life cover 10 to 15X their annual income.

What Is Term Insurance Cover Calculator?

Term insurance calculator calculates the amount that is to be paid out as a lump sum in the event of a death of the insured during the policy term. However, how much insurance coverage does one need, is a common question.

Currently, the sum assured amount that is looking huge to you can be not sufficient for your family in the future. This is due to our lack of knowledge about the selection of life cover that can cause financial problems in the long run. Hence, it is very important to know how much life cover you require to ensure that you are not underinsured or overinsured.

The term insurance cover calculator does the same. It calculates the approximate amount that your family may need in the future as term insurance cover. Resultantly, enables you to make an informed decision of selecting a sufficient coverage amount.

Most of the term insurance providers offer the facility of this calculator for term life insurance cover calculation. Here is a brief overview to use this calculator and get to know how much term insurance cover you need:

Term Plans

₹1
Crore

Life Cover

@ Starting from ₹ 13/day⁺

₹50
LAKH

Life Cover

@ Starting from ₹ 8/day⁺

₹75
LAKH

Life Cover

@ Starting from ₹ 12/day⁺

How to Use Term Insurance Cover Calculator?

You can easily calculate the term insurance cover amount online in just a few clicks. You are required to follow these steps and you are good to go:

Step 1 – Visit the official website of the insurance company

Step 2 – Click on Term Insurance Calculator

Step 3 – Enter your details such as age, gender, mobile number, lifestyle habits (smoker or non-smoker), and proceed to customize your term insurance plan

Step 4 – Select the life cover amount you want to opt for along with the number of years you require it for.

Step 5 – Choose the best term insurance plan in India and proceed to pay

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Benefits of Term Cover Calculator

Now that we have understood the benefits of term insurance, let us take a look at the 3 ways to calculate the term insurance cover.

Less Time-Consuming!

The online term insurance calculator provides term plan quotes in a couple of minutes. No documents are required to be submitted. You are only required to provide certain details and the screen will show the amount of coverage that you may need.
Comparison Is Easy Now!

Apart from providing term plans easily, computing term plans’ cover online helps compare the different plans. This makes you take an informed decision as you get the required cover at comparatively lesser premium rates.
You Can Save a Lot of Money On Premiums!

Insurers are encouraging the online buying of term plans to decrease the cost of distribution. This benefits the insurance buyer as the premium rates get lowered when you purchase a plan online after analyzing the term insurance cover online.

* Note: You can consider buying the best term insurance plan for 1 Crore to ensure the financial security of your family.

Wrapping It Up!

A term insurance plan is one of the most low-priced investments for protecting your financial future. Before purchasing the term insurance plan, it is very important to calculate the term insurance cover based on your financial requirements and life goals. Term life insurance cover calculation helps predict the amount of cover you are required to pay regularly. Choose your plan wisely!

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˜The insurers/plans mentioned are arranged in order of highest to lowest Sum Assured(SA) offered by Policybazaar’s insurer partners offering term insurance plans on our platform, as per ‘first year premium of life insurers as at 31.03.2025 report’ published by IRDAI.

Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the IRDAI website www.irdai.gov.in

Rs. 400/month is starting price for a 1 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

Rs. 400/month (Rs.13/day) is starting price for a 1 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 230 is starting price for a 50 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 8/day is starting price for a 50 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 12/day is starting price for a 75 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 497/month is starting price for a 1.5 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 487/month is starting price for a 2 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 626/month is starting price for a 3 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 905/month is starting price for a 5 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,267/month is starting price for a 7 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

*The full refund of premium is available on availing the one-time option of refund of premium. Total premium paid for policy (paid for add-ons) will be the special exit value, payable on availing the one-time option of refund of premium if you wish to completely exit the policy.

+Rs. 447/month is starting price for a 1 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs.679/month is starting price for a 2 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 910/month is starting price for a 3 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,374/month is starting price for a 5 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,924month is starting price for a 7 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

Women

+Rs. 400/month is Starting price for a 1 crore term life insurance for an 18 year-old Female, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

Rs. 461/month is the starting price for a 1 crore term life insurance for an 24 year-old female, non-smoker, with no pre-existing diseases, cover upto 54 years of age.

1,642/month is the starting price for a 1 crore term life insurance for an 44 year-old female, non-smoker, with no pre-existing diseases, cover upto 74 years of age.

Prices offered by the insurer are as per the approved insurance plans | #All savings and online discounts are provided by insurers as per IRDAI approved insurance plans | Standard Terms and Conditions Apply | **Tax Benefits are subject to changes in tax laws.| Policybazaar Insurance Brokers Private Limited

We will respond in the first instance within 30 minutes of the customers contacting us. 30-minute claim support service is for the purpose of giving reasonable assistance to the policyholder in pursuance of the claim. Settlement of claim (including cashless claim) is the responsibility of the insurer as per policy terms and conditions. The 30-minute claim support is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. For further details, 24x7 Claims Support Helpline can be reached out at 1800-258-5881

For more details on risk factors, terms and conditions, please read the sales brochure carefully before concluding a sale

Policybazaar Insurance Brokers Private Limited | CIN: U74999HR2014PTC053454 | Registered Office - Plot No.119, Sector - 44, Gurgaon, Haryana – 122001 | Registration No. 742, Valid till 09/06/2027, License category- Composite Broker Visitors are hereby informed that their information submitted on the website may be shared with insurers. Product information is authentic and solely based on the information received from the insurers.

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