The multiple-of-earnings approach consists of multiplying one's income by some factor to derive an estimate of the amount of life insurance needed.

Question

Quizplus · Accepted Answer

This is correct. The multiple-of-earnings approach is a common method used to determine the amount of life insurance needed. The chosen factor is often between 7-10 times one's annual income, although individual circumstances and needs should also be considered.

The Multiple-Of-Earnings Approach Consists of Multiplying One's Income by Some