The key to understanding your insurance needs is to determine what protection you need today, and keep in mind what may be important tomorrow. How much coverage you need, combined with your cash flow, and the length of time you need the coverage, are all used to determine the type and how much life insurance you should buy.

Our intention is to offer you the most competitive term insurance rates in Canada so that you can save on your insurance costs. Selling you “too much” insurance (more than what you need) defeats this purpose. Thus we suggest you utilize the Insurance Calculator by clicking on the icon below.

In general, there are two methods used to determine the amount of insurance an individual requires.  The first is the 'human-life approach' which projects an individual's income through his or her remaining working life expectancy, and then the present value of the life is determined by means of a discount rate. The second is the 'needs approach' where all reoccurring and unusual expenditures are examined to determine the amount of life insurance needed. 

Human-Life Approach

This method calculates the amount of life insurance a family will need based on the financial loss the family would incur if the insured person were to pass away today. The characteristics taken into account are the insured individual's age, gender, occupation, annual wage, employment benefits, targeted retirement age, as well as the personal and financial information of the spouse and/or dependent children. This method is typically only used for families with working family members Remember, when using the human-life approach, you'll want to replace all of the income that's lost when an employed spouse dies. To be more precise, you'll want to include only the after-tax pay, and make adjustments for expenses (like a second car) incurred while earning that income. Also, don't forget to add the value of health insurance or other employee benefits to the income number.

Needs Approach

This method calculates how much life insurance is required by an individual or family to cover their needs or expenses should the insured person die today. The needs approach is really a function of two variables: how much will be needed at death to meet obligations, and how much future income is needed to sustain the household. Expenses such as funeral costs, legal fees, estate and gift taxes, business buyout costs, probate fees, medical deductibles, emergency funds, mortgage expenses, rent, debt and loans, college, child care, private schooling and maintenance costs need to be taken into consideration. 

Coming soon: Needs Analysis Calculator.