What does the Human Life Value approach aim to determine?

The Human Life Value approach focuses on quantifying the economic value of an individual’s future earnings that they would have generated had they lived. This method takes into account the projected future income that a person at risk is expected to earn, factoring in aspects such as age, profession, and salary growth over time. By estimating these future earnings, the approach provides a measure to help determine the financial impact that the loss of that individual would have on their dependents.

This approach is particularly useful in assessing the amount of life insurance coverage needed to replace the lost income for a family, ensuring they can maintain their standard of living. Thus, the aim of the Human Life Value approach is integral in financial planning, especially in life insurance contexts, as it addresses long-term financial implications rather than just immediate needs or assets.