is-term-life-insurance-a-part-of-your-monthly-household-budget

Is Term Life Insurance a Part of your Monthly Household Budget?

Include term life insurance in your monthly budget to ensure affordable protection and long-term financial security.

Written by : Knowledge Centre Team

2026-01-04

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11 minutes read

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Varun, a 29-year-old software engineer got married last year. The newly wedded couple was living their life to the fullest. They made sure that they have everything to live a modern life where electronic devices formed an inseparable part of the household. Both of them were having the latest smartphones, laptops, and an Android TV along with subscriptions of various premium applications. Every weekend they used to go out shopping followed by dinner at some high-end restaurant.

On top of all this, they were having yearly memberships in a few clubs and in a gym too. So basically, they had everything which a newly wedded couple could desire.

Life was perfect. But all this took a toll on savings and they certainly lacked adequate savings plan. In the bustle of this life, Varun had all but forgotten about investing anything in essentials like term life insurance.

Part of the reason could be the fact that his employer had provided him with large health and accidental insurance.

The Unexpected Event

One fine morning Varun found that one of his neighbours, Praveen, passed away in an accident. Praveen was of the same age as him and lived with his wife and a small child in the same building. Varun knew his lifestyle was somewhat a hallmark of the modern lifestyle, the same as his own.

Praveen was running a business and was doing good but planned for emergencies like this. The news shocked the whole neighbourhood. Everyone tried supporting the new family but within few months Praveen’s wife started planning to move back to her parents. On inquiring, Varun came to know that his friend had not invested in a contingency plan and did not have any life insurance.

Fortunately, Praveen’s home loan had a term life insurance policy which covered the liability in case of Praveen’s untimely demise. But the policy only covered the home loan balance and did not provide anything to the family. Being new to the business, his savings were not enough for his wife to manage her and the baby’s monthly expenses.

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The Eye-Opening Experience

This incident opened Varun’s eyes and forced him to think of the emergency situations similar to what Praveen’s family is now facing. He discussed this matter with his wife and they both decided to check their monthly expenses and make a budget.

Their first month’s budgeting exercise gave them the following picture of their outflows:

varun income go

Varun also realised that more than 60% of credit card expenses were unnecessary and some even unrecognizable.

Varun and his spouse realized that they were getting into the habit of spending money without even realizing the value of the outflow.

This wakeup call was enough for them to immediately seek professional help with their financial life.

The Professional Financial Advice

Financial advisor, fortunately, did not find Varun’s situation exceptional. In fact, she told them that this is the same story for most of the young families today, especially those in cities. In the hurry to meet the peer pressure for good lifestyle more important financial decision often take the back seat.

She told them to always remember two facts while deciding on spending money on anything:

  • Once you buy something like a car or any electronic item, your money is gone, and the value of the asset starts declining the next moment
  • They should plan for contingencies not for long-term stress but for the long-term peace of mind

Term Insurance Plan & Contingency Plan

The advisor shared that the money allocation should begin with the contingency plans first. Which will include the following:

  • Emergency Fund: A corpus equal to three to six months of Varun’s salary deposited in a savings account or other liquid investments.
  • Personal Insurance Portfolio: Mediclaim, critical health, personal accident & term life insurance plans should be next outflow from the salary

Advisor also educated Varun and his wife on the best life insurance policy adding that the plan should have the following features and benefits:

  • A regular income payout option for the death benefit
  • Critical health and personal accident insurance as add-on covers
  • Opportunity to increase the life cover at crucial stages in life, such as childbirth

The possibility of online purchase and monthly premium payment would be added advantages for Varun. However, the features above are very important for Varun and his wife.

The advisor also told him that it’d be better if he adds his wife under the umbrella too. She explained her important contribution in his life and how it may change if anything happens to her.

How Much Would the Life Insurance Cost?

Varun was in for a pleasant surprise when he found out the premium for adequate term insurance for himself (death benefit sum assured of Rs. 1 crore). The premium of the term insurance plan with Rs. 1 crore life cover and all three additional benefits came a little over Rs. 15,000 a year.

Divided into monthly instalments, Varun can easily include some Rs. 1300 in his monthly budget. They realised how easy it’s going to be for them to maintain and stay safe with this minuscule amount into their monthly budget.

They already have so many monthly subscriptions running which they often end up not using, and the cost of financial safety is equal to only one of them.

Do You Have Term Insurance Premium in Your Budget?

Cost of financial security through a term insurance plan is low enough for you to automate the premium payment and forget. Additionally, you do not have to be involved with the policy regularly. You can enjoy your life and invest in your family’s financial goals, all the while staying safe under the insurance umbrella.

Canara HSBC Life’s iSelect Smart360 Term Plan term insurance can offer you all the benefits discussed above and more under a single plan. The best part is, you can even choose to pay the entire premium for the next 30 years of life cover with all the benefits in a single instalment.

Opting for single premium payment is the only good reason why you may not have a term insurance premium in your monthly budget. Otherwise, make sure you have opted for auto-debit of the premium from your account before you start sending money to any other activity.

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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