The need for life insurance is based on various factors, including your current lifestyle, expected outflows
in future, your present age and your family size. The first step should be to estimate how much financial
support your dependents would need to continue to enjoy the same lifestyle as they enjoy today if you are
not around to provide that support. In estimating this support, you should consider all regular monthly expenses,
including food, rentals, conveyance, school fees, medical expenses, any debts to be repaid, etc., and also estimated
ones like children's education and marriage and your expected needs after retirement. Always provide for unforeseen
contingencies that your dependents might need during the period of adjustment. Based on this analysis and the
expected returns on the investments in future, you can work out a sum of money that would help your dependents
achieve financial independence even if you are not around to support them. While every individual's situation
would be different and should be evaluated separately, one rule of thumb is to buy a cover for an amount equal
to 6-10 times your annual income. The need for insurance is not static and will change as your life stage changes,
so you must re-work the requirement periodically and review the coverage available occasionally. It is advisable
to speak to a trained financial consultant/insurance advisor to determine the extent of coverage that you require.