Needs Approach
Definition
- A method used is to estimate the amount of life insurance an individual should purchase that takes into consideration the future expected needs and financial obligations of the beneficiaries. With the needs approach, upcoming expenditures are reviewed to determine the full amount of insurance required. Expenditures commonly reviewed include funeral expenses, mortgage payments, tuition costs, future income, and others.
Synonyms
needs approach to purchasing insurance
Related Terms and Acronyms
- Canada Education Savings Grant (CESG) — Acronym, Canada,
- Program recently introduced by the federal government whereby it will invest, in the form of grants, along-side parents who save for their children's education through RESPs. The government will top up contributions made to an RESP by 20% up to a yearly maximum of $400 per beneficiary.
- Commissioners' Reserve Valuation Method — Definition,
- A method used to determine the minimum statutory reserves for annuities and insurance products.
- Family Income Rider — Definition,
- A recurring or lump sum life insurance benefit that matches the policyholder's income.
- Human Life Approach — Definition,
- A method of estimating what the probable lifetime financial impact a life insurance policyholder's death would have on his or her beneficiaries.
- Mortgage Insurance — Definition, Very Important,
- Insurance that protects a lender if a homeowner fails to pay off his or her mortgage.
- A policy covering a mortgagor from which the benefits are intended (a) to pay off the balance due on a mortgage upon the death of the insured, or (b) to meet the payments on a mortgage as they fall due in the case of his death or disability.
➥ CanEquity offers mortgage insurance. - Mortgage Life Insurance — Definition, Very Important,
- Insurance that covers the costs of paying off a mortgage if the insured dies or becomes disabled.
- Tuition Insurance — Definition,
- Insurance that covers tuition costs if a student is required to leave school in the middle of a semester.
