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How Much Life Insurance Do I Need

The sum insured on a life policy is chosen by you, not by the insurer. This calculator adds up what your household would have to carry and subtracts what is already covered, to give you the figure that is missing.

Cover still needed
€330,000
Total need
€500,000
Already available
€170,000
Need already covered
34%
  • The need adds €160,000 of debts, €300,000 of income to replace and €40,000 of future costs.
  • This calculator gives the capital to insure, not the premium: the price depends on age, health and each insurer's tariff, and only an insurer can quote it.

Video: how to use the calculator

1

First: what would have to be settled

Start with the mortgage capital outstanding, usually the largest part, and add other debts that would not disappear. If you already hold a life policy tied to the mortgage, the debt appears here as a need and the policy appears later as a resource: the two lines cancel, which is exactly what should happen.

2

Then: how many years of income to guarantee

Multiply net annual income by the number of years the household should be able to get through without it. There is no correct number of years, and this calculator does not pretend otherwise: it is your judgement, and you can see immediately what each extra year costs in capital.

3

Add the future costs you can already foresee

One-off sums the household would face, typically education to the end of a stage. They enter at face value, with no indexation: the sum does not try to be more precise than the question allows, and that is stated rather than hidden inside a rate.

4

Finally: subtract what you already have

Capital from policies in force plus available savings. What remains is the cover still to buy. If the result is zero, the useful conclusion is that you do not need more insurance, and that is as valid an answer as any other.

Worked example

A household with 150 000 EUR outstanding on the mortgage, 10 000 EUR of other debts, 30 000 EUR of net annual income they want guaranteed for ten years and 40 000 EUR foreseen for education. The total need is 500 000 EUR. They already hold a 150 000 EUR policy tied to the mortgage and 20 000 EUR of savings, so 170 000 EUR of resources: the need is 34 % covered and 330 000 EUR of capital is missing.

Frequently asked questions

How much life insurance should I buy?
Enough to settle the debts that would remain, replace income for as many years as you judge necessary and cover foreseeable future costs, less what you already hold in policies and savings. There is no legal rule and no universally correct multiple of salary: it depends on the debts, the income and who depends on you.
Why does this calculator not give me a price?
Because the premium depends on age, the health declared in the medical questionnaire, the term and each insurer tariff, and none of those tables is public. Any figure we published would be invented. The capital, by contrast, can be worked out from your own numbers, and that is what you take to an insurer or a broker for a quote.
Should I count my mortgage life policy?
Yes, and it matters. That policy covers the debt to the bank, so it belongs in the resources already available. Forgetting it leads to buying a second capital for the same debt. Bear in mind that on a decreasing-capital policy the sum insured follows the debt and falls every year.
What about the Social Security survivor pension?
It is not included automatically, deliberately. It has its own eligibility rules and its own calculation, and folding in an estimate would hide an assumption inside a number. If you want it counted, add the amount you expect to the savings line and see how the result moves.
Is the figure adjusted for inflation?
No. The sum is at today prices, with no indexation or discounting. A present-value calculation would require choosing a discount rate, which would move the result more than the precision of the question justifies. If you want headroom for inflation, raise the years of income to guarantee.

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Author: Thorben Rasmus Idel · Reviewed by: Nahar Geva · Last reviewed: