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Insurance Coverage Calculator

Three common methods to estimate the appropriate life insurance coverage: Double-10 (10× annual income), income replacement (expenses × years of dependency), and net liability (debt + expenses − assets). The tool computes all three and shows the median as a suggested target.

Inputs

Years until children are independent, mortgage paid off, or spouse retires — i.e. years your family still depends on your income.

Current finances

Sum of mortgage, car loans, etc.

Sum of savings, investments, and other liquid assets.

Existing insurance

Results
Suggested life coverage (median of three rules of thumb)
NT$12M
Range: NT$10.5M – NT$15.5M
Three common methods
Double-10 rule (annual income × 10)NT$12M
Income-replacement method (annual expense × years of obligation)NT$10.5M
Net-liability method (debt + expense PV − assets)NT$15.5M
Life coverage gap (median − existing)
NT$9M
Annual premium sanity check (currently 10.0% of income)
Reasonable range: up to NT$120K (10% of annual income)
Warning threshold: NT$180K (15% of annual income)

All three methods are common rules of thumb from public literature. Double-10 centers on annual income; the income-replacement method focuses on family obligations; the net-liability method considers your current finances. Actual needs depend on health, family structure, and risk tolerance — consult a licensed insurance professional.

Premium sanity check

Most sources consider premium > 15% of annual income as excessive (often a sign of over-sold investment-linked insurance). The tool flags this warning when applicable.

Frequently asked

Why is Double-10 'income × 10'?
Rule of thumb: 10× annual salary gives dependents roughly 10 years of buffer after losing the primary earner — enough to adjust careers, education plans, and lifestyle. Capping premium at 10% of income protects cashflow. Double-10 is the simplest, coarsest method and works best for households without complex liabilities.
I have a mortgage — how should I size coverage?
Use the net-liability method: coverage = remaining mortgage principal + present value of household expenses through children's independence − existing liquid assets (investments, policy cash value). This ensures dependents can clear the mortgage and maintain baseline living costs until kids are independent. The tool computes all three methods side by side.
Is more coverage always better?
No. Premium above 15% of income is usually over-insured (often a symptom of over-sold investment-linked insurance). Insurance's purpose is to cover low-probability, high-cost events. A healthy primary earner should pay 1-3% of monthly income for life insurance, not 10-15%. The tool flags an over-insured warning.
How should I prioritize life, accident, medical, and cancer coverage?
Cover the largest risks first. (1) Life insurance (protects family): essential for primary earners. (2) Accident insurance (protects self): low premium, broad coverage — high value. (3) Medical: focus on actual-expense reimbursement, lifetime coverage rarely worth it. (4) Cancer: consider with family history or middle-age; otherwise lower priority. Keep all-in premium under 10% of income.
Married with no kids — do I need high coverage?
No. If your spouse has independent earning capacity, 3-5× annual income is sufficient (covers 1-2 years of adjustment). Insurance protects people dependent on your income — no dependents means no need for heavy coverage. Reassess at major life changes (kids, divorce, spousal job loss).
Does this tool store my family and income data?
No. All math runs locally in your browser. Nothing is uploaded.

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