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Life Insurance Calculator

Run your own Canadian term life insurance quotes

Our life insurance calculator can give you a rough estimate of the amount of life insurance you may need. This calculator is known as an 'income replacement calculator'. It calculates the lump sum of money needed to produce a replacement paycheque. This lump sum is assumed to be the amount of life insurance needed.

Income to be Replaced:
Percent of Income Needed
Interest Rate:
Inflation Rate:
Number of Years to Replace:

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For many of us we want to maintain our dependents' standard of living should we die. How do we maintain our standard of living? Through our income, our paycheque. It's that paycheque that allows us to live where we do, drive the car, save for retirement, and buy the groceries. Should we die, financially speaking we've lost our income. If we calculate how much insurance it takes to replace an income, that gives us an estimate of how much insurance we need.

A rule of thumb is that if we have one income in the household, we want to replace 80% of the income. If we have two incomes, then we would replace 60% of each individual's income to get an estimate of 'how much insurance do I need?'.

Since all of these calculators are estimates, we recommend using a range of values rather than one fixed number. The easiest way to get a range is to run the calculator with two time periods. For the upper limit consider if you died tomorrow. For completely income replacement coverage we would need a replacement paycheque until you would have been age 65. So for the upper limit use the number of years between your current age and when you will be age 65.

For the lower limit, if you have younger children it's common to use the number of years until the children are through school and out of the house - until they are no longer financially dependent. At that point you may assume that the surviving spouse will be financially dependent on their own, so no coverage is needed.

And for many of us who fit the profile of 'earning an income, with depenedents', somewhere between those two numbers is a suitable amount of life insurance.

If you have questions on this calculator or would like to discuss this with a broker, feel welcome to call us toll free at (866) 662-5433.