How life cover need is calculated
This calculator uses the expense method of human life value:
Cover needed = Present value of family expenses for the support period + Loans + Goals − Existing cover − Savings
- Family expenses: what the household spends in a year without the earning member, growing with inflation each year.
- Support period: until the youngest child is independent or the spouse reaches retirement age.
- Loans: home, car and personal loans should be cleared so the family keeps its assets.
- Goals: children's education and marriage at today's cost.
Quick rules of thumb
| Method | Cover |
|---|---|
| Income multiple (for young earners) | 15 to 20 × annual income |
| Income multiple (40s) | 10 to 15 × annual income |
| Expense method (this tool) | Based on the family's actual needs |
For insurance agents
Share the card before you discuss products. It frames the conversation around the family's need rather than a policy, which builds trust. Your agent code and the line "Insurance is the subject matter of solicitation" are added automatically, and the card states it is an illustration, not an offer.
See also the retirement planner and the daily post maker for awareness posts.