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
Sai Kumar

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

  1. 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.



  2. 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 !

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