How much life insurance should I have?

Before buying a life insurance plan, you should keep in mind how much insurance coverage would be sufficient for your family in the future.

Your insurance coverage should be decided on the basis of the following conditions–

The needs of you and your dependants;
The amount of expenditure you will need to incur to fulfill your needs; and
Your general financial circumstances.

There is a golden rule that states the death benefit of your policy should be 10-12 times of your annual earnings. Another golden rule is 300 times of your monthly expenses (minus EMIs) plus your outstanding liabilities and three times the current cost of the goals.

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