Life Cover Needs Calculator
How much life insurance?
Calculate life insurance cover needed for dependants. Enter income to see life cover shortfall given income replacement needs and debts.
What this tool does
This tool calculates life cover shortfall given income replacement needs, debts, and existing cover.
Enter Values
Formula Used
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Calculations, display, or translation — let us know.
Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Life insurance need = income replacement + debts + lump sum for dependants, minus existing cover. This calculator shows exact shortfall to inform policy amount.
50k income × 10 years = 500k replacement + 250k mortgage + 50k dependant fund = 800k total need. Existing cover 100k. Shortfall: 700k additional cover needed.
Term life insurance for 700k at age 35 typically 15-30/month. Cheap insurance for significant protection. Most households under-insured - run the tool to size the gap honestly.
Run it with sensible defaults
Using annual income of 50,000, years of replacement of 10, existing life cover of 100,000, outstanding debts of 250,000, the calculation works out to 700,000.00. Nudge the inputs toward your own situation and the output recalculates instantly. The defaults are meant as a starting point, not a recommendation.
The levers in this calculation
The inputs — Annual Income, Years of Replacement, Existing Life Cover, Outstanding Debts, and Dependants Care Lump Sum — do not pull with equal force. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.
How the math works
Total need = income × years + debts + lump sum. Shortfall = need - existing cover. The working is transparent — you can verify every step yourself in the formula section below. No black box, no opaque "proprietary model".
What the score tells you
Headline financial numbers — income, savings, debt — each tell part of the story. This calculation stitches several together into a single read you can track over time. The value is in the direction, not the absolute number.
What this doesn't capture
The score is a composite of the inputs you provide. Life context — job security, family obligations, health, housing — doesn't appear in the math but shapes the real picture. Use the number as a prompt, not a verdict.
£50,000 £ × 10 yearsyrs + £250,000 £ debts + £50,000 £ - £100,000 £ = $700,000.00.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
Total need = income × years + debts + lump sum. Shortfall = need - existing cover.
References
Frequently Asked Questions
Term vs whole life?
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