How to Calculate the Right Life Cover
⏱ 2 min read
“How much cover should I buy?” is the most common question in life insurance. The answer is arithmetic, built from four items.
1. Income replacement
Decide how many years the family should be able to maintain its standard of living. Annual net income × number of years forms the base.
2. Debts
Add outstanding mortgage, car loan and other obligations, so the family is not left carrying them.
3. Goals
Add children’s education costs, including university, and any planned major expenditure.
4. Subtract existing assets
Deduct savings, investments, BES balance and any other life policies. What remains is the cover you need.
Review points
Inflation and income growth should be considered, so revisit the sum every few years. The birth of a child, buying a home and a change in income are typical triggers for an update.
Premium budget
If the calculated need is large, a term policy buys far more cover for the same budget than a savings-linked one. Managing protection and saving through separate products is usually more efficient.
Frequently asked questions
Term or savings-linked life insurance?
For the same budget a term policy provides far more protection. Saving is usually better handled in a separate vehicle.
How often should I review the sum assured?
At life events — income change, a child, buying a home — and at least every few years.
Related pages
Insurance advice in Maslak and the surrounding area
“How to Calculate the Right Life Cover” is one of the questions we are asked most often by clients in Maslak, Seyrantepe and 4. Levent. For families with mortgages in the Maslak area we explain why loan-linked life cover protects the bank, not the household, and what separate cover is needed.
Our office is based in Maslak, Istanbul. We meet clients within a short drive — Maslak, Seyrantepe and 4. Levent — or handle everything by phone, e-mail and WhatsApp, in Turkish and English. If you are searching on your phone for an insurance agency nearby, you can simply call +90 540 384 21 41 or see the related service page.
We compare policies from several insurers and explain the differences before you buy. Contact us or call +90 540 384 21 41.
