The needs-based approach is one technique for calculating how much life insurance one needs. Explain briefly the method for calculating this amount

What will be an ideal response?

To calculate the amount of life insurance needed using the needs-based approach, the following formula is generally followed:
1. sum up all the assets required to meet financial needs assuming death occurs today
2. subtract the assets and already-owned life insurance available to meet those needs
The result is the amount of new life insurance required to meet those needs.