How to Decide Which Sum Assured Housewives Should Choose?
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In many families, while the husband is the primary earner and policyholder, the wife manages the household and the children's needs. So, when buying Term Insurance, the real concern is whether the cover will truly support her if she has to manage everything alone.
This is why understanding which sum assured housewives should choose matters. It is not about picking a random amount, but about ensuring the family's financial stability, dignity, and continuity during difficult times.
Why the Housewives' Role Matters in Deciding the Sum Assured?
A household runs on more than income. Wives often manage planning, coordination, and finances, giving them a clear understanding of family needs. From budgeting to children’s education and savings, they handle the practical side of daily life.
If the husband passes away, wife becomes main decision-maker. The Term Insurance payout defines how confidently she handles this phase.
This is why she must be involved in deciding the sum assured. The goal is not just income replacement, but ensuring she can run household smoothly, support children's future needs, manage liabilities, and avoid rushed financial decisions.
Key Factors That Help Decide Which Sum Assured Housewives Should Choose
Choosing the right sum assured requires practical financial planning. Couples should assess current responsibilities and future needs to ensure long-term family stability.
1. Ongoing Household Expenses
Daily costs like groceries, utilities, school fees, healthcare, transport, and domestic help continue. The sum assured should cover these for several years or generate a steady income. Open discussions on monthly and annual expenses help decide right coverage.
2. Children's Education and Development
Education is a long-term responsibility lasting 15–20 years. The payout should support tuition, accommodation, learning tools, and skill development without forcing asset sales or dependence on external funding.
3. Impact on the Wife's Role and Responsibilities
Managing everything alone may require external or professional support. The sum assured should provide flexibility to make family-first decisions without financial pressure.
4. Existing Financial Commitments
Loans may continue even after the loss of an earning member. The payout can help close or reduce liabilities, easing EMI pressure. Listing all debts is essential for planning.
5. Inflation and Time Horizon
Inflation reduces value over time. Coverage should reflect how long financial support will be needed to stay meaningful.
Why ₹1 Crore Is Often Considered a Practical Choice?
For many families, ₹1 Crore is a common choice for term insurance, as it aligns with usual financial responsibilities such as liabilities, household expenses, and long-term goals.
- Inflation Protection: Offers better coverage against rising costs.
- Income Potential: Can generate a regular income if invested wisely.
- Education Security: Supports higher education without financial stress.
- Cost Efficiency: The premium difference between ₹75–80 lakhs and ₹1 crore is usually small, making higher cover more practical.
Overall, higher coverage balances affordability and protection based on income and eligibility.
Choosing the Right Term Insurance Policy
After deciding the coverage amount, selecting the right insurer is the next step. The focus should be on reliability, long-term stability, and smooth claim processes.
Key aspects to evaluate include:
- Claim Settlement Record: A strong and consistent settlement history reflects an insurer's reliability. Reputed insurers like Bajaj Life Insurance, with a reported claim settlement ratio of 99.29%, demonstrate their ability to support families during critical times.
- Financial Strength: A healthy solvency position indicates the insurer's capacity to meet future obligations, offering long-term confidence.
- Premium Value: Premiums should be assessed along with policy features, service quality, and transparency to ensure balanced coverage.
- Useful Riders: Optional add-ons, such as critical illness or accidental death riders, enhance protection and allow coverage customisation.
Choosing the right insurer ensures long-term protection, smoother claims, and dependable support, helping families feel secure and confident during unexpected and challenging moments in life.
Tax Benefits of Term Insurance
Along with financial protection, it also offers tax advantages that support household planning. While tax benefits should not be the main reason to buy a policy, they do add value when considered properly. Premiums paid qualify for deduction under Section 80C of the Income Tax Act, 1961, within prescribed limits, if the policyholder chooses the Old Tax Regime. The New Tax Regime does not allow this benefit. Additionally, death benefit received by the wife as nominee is tax-free under Section 10(10D), ensuring full financial support when it matters most.
Conclusion
Term Insurance is meant to protect the family's lifestyle, not just replace income. When couples decide the sum assured together, they account for real needs such as monthly expenses, children's education, and existing loans. The right coverage gives the wife financial stability and the confidence to manage responsibilities without stress. Whether it is ₹50 lakhs or ₹1 crore, the amount should be based on the household's actual needs.
Disclaimer: No Business Standard Journalist was involved in creation of this content