Life Insurance Needs Analysis
Systematic determination of appropriate coverage using DIME (Debt + Income + Mortgage + Education), Human Life Value, or Capital Needs Analysis.
Get personalized explanations
💡
Exam Tip
Know DIME method. HLV: younger = higher value. Capital needs = most sophisticated. Subtract existing resources and Social Security.
Methods
DIME Method
- D: Debt + final expenses
- I: Income × years needed
- M: Mortgage balance
- E: Education costs
Human Life Value (HLV)
Present value of future earnings.
- Younger = higher HLV
- Higher income = higher HLV
Capital Needs (Most Sophisticated)
Identifies specific survivor needs, then subtracts existing resources.
Study This Term In
Related Terms
Term Life Insurance
Term life insurance provides death benefit protection for a specific period (term), with no cash value accumulation, offering the lowest premium for the highest coverage.
Whole Life Insurance
Whole life insurance is a permanent life insurance policy that provides lifetime coverage with fixed premiums, a guaranteed death benefit, and cash value that grows at a guaranteed rate.