InsuranceFinancial Glossary
Sum Insured
Definition
The maximum amount an insurer will pay for covered claims during the policy period. In health insurance, it represents the ceiling of hospitalization expenses covered per year. In term insurance, it is the death benefit paid to nominees.
Why It Matters
Your sum insured must keep pace with medical inflation (running at 14-15% annually in India). A Rs 5 lakh health insurance plan purchased in 2020 would need to be Rs 10 lakh by 2025 to maintain the same purchasing power. Oquilia's underinsurance quiz helps determine if your current coverage is adequate.