Guardian Life Insurance Company: Your Human Life Value

A very interesting article on the Guardian Life Insurance Company website "Your Human Life Value May Be More Than You Think", gives some valuable, and surprising information on Human Life Value.  Many Americans have no idea what this means, but it's important to know.  Human Life Value can be defined as the present value of future income that you plan to earn for your family including other value you plan on contributing, minus taxes and consumption.  This is measured through your expected retirement date.

The article goes over in detail how to calculate your estimated value and you may be surprised at the results.  Many people are worth much more than they think.  Human Life Value can be useful information when determining how much life insurance you may need to protect your family.  There are a few different methods to use to determine your worth, and the article discusses two of them.

The first common method often used is a "multiple of earnings" method.  This method is very simple and just multiplies your salary by an appropriate multiple.  It can be too simple though since it doesn't account possible pay raises, or non-wage value.  The Human Life Value is a system that courts often use to award judgments in wrongful death law suits.  It's a more complicated version of calculation but is seen as much more accurate.

Having your life insurance needs carefully reviewed and evaluated by a professional is a responsible way to ensure you are calculating your life insurance needs appropriately.  Understanding how to calculate your worth and your Human Life Value will give you an idea of where to start and can give you a starting point to making the right decision when choosing your life insurance policy.