Assess Insurance Need
1-2 hoursDetermine whether you need life insurance and calculate coverage amount based on income replacement, debts, and future obligations.
Field context
This workflow is part of 1 niche field
Life insurance planning guide for choosing term vs whole life, calculating coverage needs, beneficiary designations, and policy review timelines for families.
Determine whether you need life insurance and calculate coverage amount based on income replacement, debts, and future obligations.
Compare term life (affordable, temporary) vs whole/universal life (permanent, cash value) based on your needs and budget.
Use the DIME method (Debt, Income, Mortgage, Education) to calculate precise coverage needs.
Get quotes from multiple carriers for identical term length and coverage amount — rates vary 30-50% for same coverage.
Designate primary and contingent beneficiaries, review coverage after major life events, and avoid lapsing policies.
Determine if life insurance is needed and estimate coverage amount. · Compare term vs whole life costs over policy lifetime. · Calculate precise coverage using DIME method inputs. · Compare quotes across carriers for target coverage. · Reassess coverage needs at life milestones.
Ensure premium fits within monthly budget.
Compare whole life cash value growth vs term + invested difference.
Include outstanding debts in coverage calculation.
Factor education funding needs for dependents.
Comparison of major life insurance types for US buyers.
| Feature | Term Life | Whole Life | Universal Life |
|---|---|---|---|
| Duration | 10-30 years | Lifetime | Lifetime (flexible) |
| Premium | $25-$50/mo ($500K) | $400-$600/mo | $200-$400/mo |
| Cash value | None | Yes (guaranteed) | Yes (variable) |
| Best for | Most families | Estate planning | Complex needs |
A 30-year $500K term policy costs ~$30/month for a healthy 30-year-old. Whole life for the same coverage costs $400+/month — invest the $370 difference in index funds instead.
If diagnosed with a serious condition, keep existing coverage — new policies will be unaffordable or denied. Convert term to permanent before expiry if health declines.
Employer-provided life insurance (1-2x salary) is rarely sufficient and disappears if you leave the job. Supplement with personal term policy.
Buy multiple term policies with staggered expiry (10, 20, 30 year) to match declining needs as children grow and mortgage pays down.