The decision to carry life insurance and how much to carry is a very personal decision with most of our clients. The method we use as a starting point in this discussion is called “Asset Replacement”.
The technique of asset replacement begins with the question, “if I die, how can insurance coverage leave my family in the same position as if I were still alive meeting my financial responsibilities?”
For example, while alive I’m paying the monthly mortgage payment, so I’d like insurance coverage to pay off the mortgage for my spouse and children. Additional coverage might be desired for college tuition, or to support my spouse through her retirement years.
These events each have a value and that value will vary from person to person. Further, a person will face issues as to what amount of coverage they can afford and what they might qualify for, based on things such as age and one’s current state of health.
An advisor understands the personal nature of life insurance coverage and can assist you in making these important decisions.