How To Estimate Our Life Insurance Coverage Value
To provide financial security to the family, earning member insures himself for his life. The insurance company compensates financially to his family on untimely death by discharging a lump sum fund to the dependents. The fund received by the family, against death benefit, depends upon the insurance coverage taken. Hence, the financial security of the family is decided by the insurance coverage adopted. In case of its inadequacy, the family might face financial discomfort. Therefore, determination of the adequacy of coverage value of any life insurance is very important. Normally the coverage value of life insurance is assessed in the following ways – 1. Just by gut-feeling 2. Based on the suggestion by the insurance policy seller 3. Advice from Relatives/ Friends The coverage values decided by any of these processes do not follow any structured process to determine...