89063Looking for health insurance? Treatment cost of these maladies will not be covered!

While buying an insurance policy, one of the frequently asked questions is how much cover one needs to buy. It is important to buy an adequate cover as the purpose of buying a policy is to keep your family protected in case of any eventuality. Here are a few tips on how much insurance cover one should buy for the complete protection of their family:

Life insurance: According to experts one should buy cover at least 10-15 times the annual salary. For example, if the policyholder’s salary is Rs 20 lakh, then he or she should opt for a cover of at least Rs 2 crore. The interest income earned on Rs2 crore, at an assumed interest rate of 7%, will give the family an income of Rs 14 lakh every year. For more income, a higher sum insured should be bought. The second method is need-based analysis, which is a comprehensive method. It includes determining the present value of all your future expenses including loans and other liabilities.

Health insurance: The Covid-19 pandemic has increased awareness about health insurance policies. It has also raised the cost of hospitalisation with high hospital bills been reported throughout the country at the peak of the second wave. Experts, therefore, say that people living in metros should consider buying health insurance cover of Rs 20-Rs 25 lakh. Moreover, consider the city, life stage and medical inflation while buying a policy.

Home insurance: There are two methods for evaluating your home insurance coverage needs. For example, for people living in independent houses, experts suggest that the cover should be based on the construction cost, as the policy will reimburse the cost of rebuilding the house damaged due to any of the events covered in the policy. Considering that a large part of the population in metro cities live in flats the agreed value is the preferred way as its pays the full sum insured in case of any eventuality.