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Published in Mint on 30th July 2018. Written by Abhishek Bondia

My wife and I have a combined annual income of about ₹15 lakh. She has a unit-linked insurance plan (Ulip) with a sum assured of ₹5 lakh, which was bought five years ago. I don’t have any insurance as of now. How much cover should I take? Does my wife need to buy another plan?


Both of you should take an individual term insurance policy each. As a thumb rule, you should have a cover of 10 times your annual income. In term insurance, your nominee is paid only if you die. There are no survival or maturity benefits in this policy.
The current cover of ₹5 lakh in the Ulip is inadequate for your wife. Your wife will have to buy a separate insurance policy as well. Assuming you both earn equally, the sum assured each of you need is ₹75 lakh. This will come at a cost about ₹7,000-8,000 per annum.

My employer covers me for a group personal accident policy for a sum assured of two times my annual income. In case of my death, my family is likely to get this amount. My firm has not asked me for a nominee. How can I be certain on who will be the beneficiary of the policy after my death?

—Hemant Garg

In case the nominee is not defined, the legal heir of the deceased will be entitled to the insurance proceeds. If the nominee is not declared at the time of policy issuance, the insurer will ask for a succession certificate at the time of claim settlement to ascertain the beneficiary.