I’m 62 and have a corpus of Rs 5 crore. My spouse is working, and son is settled abroad. Do I need a term insurance plan?

I am retired, and my age is 62 years. My financial portfolio is around Rs. 5 crore, and my wife is still working as a professor, and her age is 58. My only son is settled in the US and is doing quite well. Do I need to buy a term Insurance plan? Thank you. Sumit Banerjee, Kolkata

D. Mukherjee

Reply by Rajiv Bajaj, Chairman & MD, BajajCapital Ltd

Our standard recommendation leans towards a term insurance plan for individuals up to the age of 65. The general guideline is that the sum assured should be a minimum of 10 times your annual income. For instance, if your annual income is Rs. 10 lakh, a term plan coverage of Rs. 1 crore is advised.

It's crucial to recognise that life insurance policies primarily serve to safeguard family members. Therefore, a term insurance plan becomes imperative for individuals with one or more family members dependent on them, be it a parent, spouse, or child. However, in your unique situation, it appears there may not be any person entirely dependent on you. Your wife is financially self-sufficient, your son is settled abroad, and you maintain a substantial financial portfolio.

Given these circumstances, it seems plausible that an exception can be made in your case, and a term insurance plan may not be a necessity. Nevertheless, we recommend periodic reviews of your financial situation to ensure that your wealth aligns with your financial goals.

Also read: I'm 20 and earn Rs 76,000 a month. How much monthly investment is needed to save Rs 1 crore for a house by age 28, and where should I invest?

Also read: I am 25 and have started investing in life insurance policies and equity mutual funds schemes. Will the money received after 10 years be taxable in my hands?

Thus, given your age, financial stability, and family situation, you may not necessarily need a term insurance plan, but it's advisable to consult with a financial advisor to determine the best course of action for your specific circumstances.

(Views expressed by the investment expert are his/her own. E-mail us your investment queries at askmoneytoday@intoday.com. We will get your queries answered by our panel of experts.)