Required. Please bring the image size down to 50 KB

Being a single parent, you have to shoulder a heap of responsibilities. You are the only one who must take care of your child’s needs, nurture them, and protect them from worries. Moreover, as a parent, the scariest thing that comes across your mind is what your children will do if something were to happen to you someday. Therefore, you must consider all the future possibilities and have a proper plan for them. From school to college, saving ample funds that your children might require while growing up for their daily needs and education are some crucial factors to consider. Which is why buying a term policy is necessary for single parents so that their children do not face any sort of financial crisis. Now, the second big question that troubles every single parent is that how much term cover will be enough for their child? Well, there are a few essential factors that can help you in determining the answer to this question. They are:

  • How Much Do You Earn?

    A term policy can provide your child with a source of income in case something happens to you. While deciding on buying a term policy, you must check that the policy covers at least 50 percent of your annual income.

  • Your Child’s Needs

    The amount of term insurance you need highly depends on your child’s needs and age. If you have younger children, the coverage amount required will be high, and you’ll want it to last longer. On the other hand, if your children are older, you can probably purchase a policy that has low coverage.

    In addition to age, you should also consider the needs of your children. It can be their schooling costs (if they study in a costly private school) or expenses related to their special medical needs and many other factors. So, make sure that the term policy you buy has enough cover to pay for such costs.

  • Your Current Debt

    If something happens to you, and you have outstanding debts, all your assets will go to paying those debts first. If you are still paying off loans, or any other debts, make sure that you pay them as soon as possible. Because if you do not do so, your beneficiary will have to pay them off and in turn, will not receive the amount you intended for them to have. So, if you are in debt, it is advisable that either you pay it off completely or increase your term insurance cover.

  • How Much Coverage Can You Afford?

    Insurance premiums increase as you increase the coverage amount. The most significant factor to consider before increasing the policy amount is your budget. While a term policy is not very costly, and you can get one at a reasonable rate, but still your income should be taken into account while buying the same. The best time to buy a term policy is when you are young as you can get better deals on the premiums.

  • Choice of Riders

    Riders provided with a term policy can be very useful depending upon your requirements. However, every extra rider comes with additional costs. Therefore, you must always check if the rider is helping in enhancing your insurance coverage or providing an extra benefit in securing your child’s future before choosing one.

    If the options available are not supporting your cause, you should refrain from purchasing a rider option. Some riders like the waiver of premium are very helpful. This rider will waive off all your future premiums in case anything untoward happens to you during the policy term. Similarly, adding the accidental death rider will provide additional financial support to your family in case of your unexpected demise caused due to the accident.

    After properly evaluating these factors the next step is to calculate the exact amount of premium for your term policy. To do that, you can take help of a term insurance calculator. The calculator provides you with the exact amount of sum assured your dependent child would require in the future as it takes into account all the variables before generating results. Moreover, it is a time saving and cost-effective tool to calculate the amount of term insurance you will need.

    Alternatively, you can also use human life value calculator (HLV) and income multiplier method to calculate the sum assured. The HLV calculator works on the formula of time value for money. It provides the present value of all the future income you are expecting to earn till you retire. In income multiplier method you can calculate your insurance premium amount by multiplying your age by a factor based on the age group to which you belong.


A recent study shows that more than 80 percent of single parents in India do not have proper insurance cover. If you fall into this category, it is essential that you buy a term policy at the earliest. You can use above-stated pointers to find out how much term insurance you will need. So, hurry up and buy a term policy to safeguard your children’s future after you are gone.