Often dealing with life insurance sales agent, they explain the importance of having life insurance, they are very fluent in describing their products and they are very eloquent when asked about the insurance process, from filing to issuance of a life insurance policy is, of course, and facilities inherent in it.

But when we ask how a reasonable sum? Explanation at this point they are generally not as good as the previous explanations, they are generally still able to ask the amount of premiums paid annually prospective customers. To avoid the condition is useful to discuss the miraculous methods commonly used by a financial planning, as a candidate for life insurance holders should already have:

1. Economic value that is a value where the average income of a year we averaged in each month or for an employee is the amount of net take-home salary home. For the benefit (sum assured) we focus only on the economic value whether or not the salary.

2. The presence of individuals other than our own are quite dependent on the economic value, eg wife, husband, son, brother, sister or parent who has retired.

3. Other concerned parties in the fund business activities, such as personal loans or bank debt out of other financial institutions that do not have life insurance. So when we plan to make loans from the Bank or financial institution, we must ask whether there is life insurance.

So it is not worth it if we buy life insurance with a condition:

The lack of economic value

The absence of other people who rely on us

The lack of hook loan debt

Then how do I compute the optimal sum, here is the explanation most frequently used methods:

Human Life Value method, this method of calculation of the absolute sum is calculated based on the average revenue per month, which we round it off a year and multiplied by the expected duration of the fund sustain life until the beneficiary is able to earn their own income. This method does not need to consider funding the growth factor if the insurance money is deposited in a bank or other investment institutions.

Bit may be useful