KNOW YOUR HUMAN LIFE VALUE AND IT’S IMPORTANCE WHILE ASSESSING INSURANCE COVERAGE

 

Human Life Value

Introduction

The biggest concern for any breadwinner of the family is what will happen to his or her family in his or her absence due to any unfortunate event, such as death. Human Life Value (HLV) determines the monetary loss that one’s family will experience in the event of an unfortunate event that leads to your death. An HLV calculator may be used to estimate the economic worth of human life.

Life is uncertain, and hence it is important for us to be prepared for the worst. Life insurance is an excellent financial instrument that can protect your family financially if any unfortunate event results in your death. Your life insurance policy takes over in your absence to financially secure your family.

However, it is crucial to choose an appropriate life insurance policy to make sure that your family does not have to compromise on anything after you are gone. Your family can achieve their goals with the help of appropriate insurance coverage. This is why, while purchasing an insurance policy, you must determine the "Human Life Value (HLV)".

What is Human Life Value (HLV)?

It is easy to measure the severity of the physical damage or loss to a car after an accident. However, what if anything unfortunate happened to you? How would you evaluate your value? HLV plays crucial role in this situation.

The "Human Life Value" is the current value of all the projected future earnings you are anticipated to provide for your family members. In short, we can say that HLV is your projected income up to retirement. Human Life Value (HLV) determines the monetary loss that one’s family will experience in the event of an unfortunate event that leads to your death.

The insurance coverage helps your family live a stress-free life with financial stability even after your death, as it serves as an income replacement option. In essence, it is the amount of money required for your loved ones to continue living, maintain their level of living, and follow their goals in the event of your passing.

How is HLV calculated?

How much life insurance is recommended for you? In India, it is customary to approach an insurance advisor who may steer you towards his preferred policy while possibly never calculating the "Human Life Value." He might conflate your need for insurance with that for investments, and he might give you some examples that look good in the short term but not in the long run. The most important thing to realize is to never combine investments and insurance.

The economic value of a human life can be calculated using an HLV. You must consider a number of variables, including your current and retirement ages, your monthly costs, your projected future spending, and your debt obligations, to calculate the appropriate insurance coverage that is required to financially secure your family.

The HLV calculator is easily available as a free online tool, and anyone can utilize this tool to determine the amount needed to adequately replace the lost income in the case of the death of a family member who is a source of income. The HLV calculator makes it easy to purchase insurance coverage as it assigns a value to human life. The primary objective of the HLV calculator is to give you an estimation of the required level of coverage to protect the financial future of your loved ones.

Conclusion

It's crucial to understand that this value changes over time. The amount depends on your stage in life, your family status, and your yearly salary. Your human life number will have a different value if you calculate it at age 25 while single than if you calculate it at age 35 when married and with a family. In order to avoid making the computation a one-time activity, it must be checked frequently.

You cannot put a price on your life; it is worth infinitely more than that. But because life is unpredictable, HLV gives your life monetary value if the worst-case scenario comes true and your family loses its source of income. Life is unpredictable, be prepared to deal with the challenges that life throws at you. 

Human Life Value is Invaluable. We are just trying to estimate the economic impact of the loss of life.

Location: Mumbai, Maharashtra, India

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