2 Essential Ways to Estimate Life Insurance in Canada

The Covid-19 outbreak has shown the importance of insurance policies among the other critical financial choices one should make. More so than ever before, people are now contemplating how much life insurance cover is needed to safeguard their families!

A precious blessing in life is raising a family that loves you. Everyone makes efforts to meet their family’s psychological and economic needs. But, if anything happens where you’re no longer able to provide, who does your family look up to?

This is where the importance to pursue an insurance policy becomes crucial. Life insurance is a safeguard for your family against financial risks, which can emerge as a consequence of your sudden and untimely death. Your loved ones can pay off mortgages with the help of life insurance. They can also cover daily living costs, and achieve various goals in life. Here is how the life insurance is estimated:


Human Life Value

The current value of your potential profits, expenditures, debts, and savings can be calculated using the Human Life Value (HLV). The HLV figure can calculate the sum of money needed to protect the future of your beneficiaries through term life insurance whenever you were to pass away.

As you determine your HLV, you must consider seven factors. They  are:

  • Your occupation
  • Your age
  • Your employment benefits
  • Your gender
  • Your target retirement age
  • Your annual income
  • Your spouse's and child's fiscal records


Income Replacement Value

This process can help you look at a life insurance cover derived from the breadwinner's missed income post an untimely demise. It depends on the policy holder’s yearly income and is a simple way of measuring one's life insurance coverage requirements.

There are many other factors that are used to estimate life insurance in Canada. Along with the information mentioned above, the other factors can determine your insurance coverage and premium.


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