Life insurance needs calculator
Answer eight money questions and get a coverage figure built the way the industry builds it — the DIME method — with every assumption printed next to the result. No email required.
How this tool works
This calculator uses the DIME method, the standard needs framework taught to insurance agents and used across the industry: Debts + Income replacement + Mortgage + Education (and final expenses). It adds up what your household would need if your income stopped tomorrow, then subtracts the resources already in place — savings you could spend and coverage you already own. The gap is your estimated need, rounded up to the next $10,000 because policies are sold in round amounts.
Assumptions, stated plainly: the income-replacement line assumes your family would spend roughly what you earn for the years you choose — it does not model investment returns on the payout, taxes, inflation, a surviving partner’s earnings, or Social Security survivor benefits, all of which move a real plan. Treat the result as a well-built estimate to take into a comparison, not as personalised financial advice. A common cross-check: many guides suggest 10–12× your annual income as a rough coverage target. If DIME and the multiple disagree wildly, the reason is usually a big mortgage or a short income-replacement window — both worth a second look.
Term vs. permanent, in one paragraph
Term life covers a defined period for a comparatively low premium and is what most needs calculations point to. Permanent (whole/universal) life covers your lifetime and builds cash value, at premiums commonly 10–15× higher for the same face amount — which tempts buyers into too little coverage. Buy the amount first; argue about the wrapper second. Our life insurance comparison shows who sells which, and how.
Questions people ask
How many years of income should I replace?
Until your dependents would be financially independent and major debts retired. Ten years is the common default in this calculator; younger children and a fresh mortgage argue for 15–20.
Should I include my employer group life insurance?
Yes — enter it under coverage you already have. Just know it usually ends when the job does, which is why many people hold an individual policy as the base layer.
Does this replace a financial plan?
No. It is a needs estimate using a published method. It deliberately ignores investment returns, taxes, and Social Security survivor benefits; a full plan would model those.
Why round up to the next $10,000?
Policies are sold in round face amounts, and rounding down a needs estimate quietly underinsures the exact scenario the insurance exists for.
Method: DIME needs analysis (Debts, Income, Mortgage, Education), the standard framework described by Life Happens and used across carrier needs calculators. Final-expenses default ($15,000) is an editable planning assumption, labelled as such. Cost context: Guardian Life 2025 rate data via LifeQuote.