This is a very important factor in purchasing an insurance policy.

The reason of having an insurance protection is to ensure that you or your dependents’ future lifestyle will not be affected should something unwanted happened.  The most basic calculation is to work out the yearly expenses needed and multiply by the numbers years that your dependent needed it.

For example your dependents needs 30,000 a year and they have another 10 years before they can make their own living, then you need a minimum coverage of 300,000. Please do take note of the inflation rate as well.

Another decision factor is your current income, you should not spend more than 10% of your current income on insurance policy. Please take note that if you are not able to pay your insurance premium, your policy will be terminated ( it is different scenario if you insurance tie to an investment link product ).

It is always good get advice from the professional, call your financial advisor today to find out more about insurance coverage that you need.