Insurance Coverage Needs Estimator
Adequate insurance coverage protects your assets and income from catastrophic loss. This calculator estimates recommended coverage levels based on your financial profile and risk exposure. Under-insuring can leave devastating gaps; over-insuring wastes money.
Estimate Your Coverage Needs
These are general guidelines based on financial planning principles. Your specific needs depend on existing coverage, employer benefits, state requirements, and personal risk tolerance. Consult with a licensed insurance professional for personalized recommendations. This is not insurance advice.
Coverage Guidelines by Type
| Coverage | Guideline | Why |
|---|---|---|
| Homeowner's Dwelling | 100% of rebuild cost | Not market value — what it would cost to rebuild the structure |
| Personal Property | 50-70% of dwelling coverage | Covers furniture, electronics, clothing, etc. |
| Liability | $300K or net worth, whichever is higher | Protects assets from lawsuits |
| Auto Liability | 100/300/100 minimum recommended | $100K per person, $300K per accident, $100K property |
| Life Insurance | 10-12x annual income | Replaces income for dependents |
| Umbrella | $1M if net worth > $500K | Extra liability above home + auto limits |
Frequently Asked Questions
What is the difference between replacement cost and actual cash value?
Replacement cost pays to replace damaged property with new items of similar quality. Actual cash value (ACV) deducts depreciation — a 5-year-old roof might only be valued at 50% of replacement cost under ACV. Replacement cost coverage costs more but provides significantly better protection.
Do I need life insurance if I have no dependents?
Generally no. Life insurance primarily replaces income for people who depend on you financially. If no one depends on your income, a small policy to cover final expenses (burial costs, debts) may be sufficient. If you have a co-signed mortgage or significant debts, coverage to pay those off may be appropriate.
When should I get an umbrella policy?
Consider an umbrella policy if your net worth (home equity + savings + investments) exceeds your home and auto liability limits. At $200-$400/year for $1 million in coverage, umbrella policies are among the most cost-effective insurance products available.