How Much Insurance Coverage One Should Have? It there Any Limit?

POSTED BY Sai Kumar ON August 3, 2012 9:05 am COMMENTS (2)

Dear Sir/Madam,
Right now I am having four different ULIP policies from four different companies. All Policies are more than 5+ years old. The total sum assured of all the policies are 4, 75,000/- and my annual income at present is 9, 00,000/-
Recently I came to know that sum assurance of the policies should not cross 20% of his annual income, for salaried person. Please confirm me.
(1) If the above statement is true, then I crossed the limit, what I have to do.
(2) Due to lack of knowledge I have not disclosed my policy to any other insurance companies, if I want to disclose now, is there any harm for me.
Please clarify
Regards,
Sai Kumar

2 replies on this article “How Much Insurance Coverage One Should Have? It there Any Limit?”

  1. Ashal Jauhari says:
    August 5, 2012 at 3:33 pm

    Dear Sai Kumar, I think you are confusing yourself with the Sum assured as a multiple of yly income. It’s not 20% but 20 times. For your given example, You may purchase a total sum assured of 20 times of 9L Rs. which 1.8C. Actually it’s a comfortable zone for insurance cos. You may go for even higher this limit subject to detailed check up of your exact needs & the risk involved with your life due to your job or other related things.

    Thanks

    ashal

    Reply
  2. Manish Chauhan says:
    August 5, 2012 at 2:56 pm

    1. there is no rule like that ..

    2. Better you get rid of these ULIPs and close it soon . Better take the money (surrender value) and take a term plan as next step !

    Reply

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