Sum Assured in Life Insurance Policy

What is Sum Assured in Life Insurance Policy?

Sum assured is the fixed amount paid to the nominee in case of the policyholder’s death.

Written by : Knowledge Centre Team

2026-02-11

737 Views

7 minutes read

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Sum assured in a life insurance plan refers to the guaranteed benefit amount under the policy. This is a fixed amount payable against the claim for the covered event.

You buy a life insurance to make sure that your family stays financially protected even if you are not present with them. This financial security is provided by the sum assured, which is payable to your family in case you die during the policy term.

Naturally, it becomes important to choose a sum assured that will be sufficient for your family. But how much it should be?

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Three Things to Consider While Choosing a Sum-Assured

Here are the following things you must consider before deciding on the sum assured:

  1. Current Income: Your income will decide how much can you pay as premiums. The higher the sum assured, the higher is the premium, thus you need to make sure how much you can spare from your income after handling the expenses.
  2. Ongoing Financial Liabilities: If you have ongoing long-term loans, you should consider to add them to the sum assured of your life insurance plan.
  3. Family’s Needs: Estimate the future expense which will be incurred such as child’s education, child’s marriage, and monthly expenses. Choose a sum assured that will be enough to cater all these.

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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