What is the Human Life Value approach to determining life insurance needs primarily based on?

The Human Life Value approach is fundamentally centered around the loss of the breadwinner's income. This method estimates the economic value of an individual’s future earning potential, representing the financial impact on dependents in the event of the breadwinner's death. It takes into account factors such as the individual’s current income, expected future earnings, and the number of years until retirement, aiming to calculate the present value of those future earnings.

This approach emphasizes the importance of the income stream that the breadwinner provides to the family, making it a vital consideration in evaluating life insurance needs. By understanding how the loss of this income could affect a family’s ability to maintain their standard of living, one can determine the appropriate amount of coverage needed.