Needs analysis (life insurance)
Certified Financial Planner glossary · Certified Financial Planner
Definition
A life insurance sizing method that totals specific obligations and goals, then subtracts existing resources.
Needs analysis (life insurance) in plain English
A salesperson quotes a round million of coverage without listing debts, education goals, or existing resources. Needs analysis sizes life insurance by totaling specific obligations and goals, then subtracting resources already in place. Human life value is a different method based on earnings replacement, and the two can produce different face amounts. Match the stem's method, and reject product push that never ties the recommended amount to stated needs.
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