Life Insurance Calculator (Philippines)
Work out roughly how much life insurance coverage would protect your family — based on your income, debts, and future plans.
How much life insurance do you need?
| Income to replace | |
|---|---|
| + Debts | |
| + Future expenses | |
| − Already set aside | |
| Suggested coverage |
A planning estimate using the income-replacement + needs method, not financial advice. Your real need depends on your family, goals, and lifestyle. Term insurance gives the most coverage per peso; talk to a licensed financial advisor before buying.
How much coverage do you need?
A simple, widely-used method adds up what your family would need if your income suddenly stopped, then subtracts what you've already saved:
Coverage = (income × years to replace) + debts + future expenses − money already set aside
- Income replacement — enough to keep your family going for several years.
- Debts — so loved ones don't inherit your mortgage or loans.
- Future expenses — big upcoming costs like children's education.
- Minus savings & existing insurance — what you already have covers part of it.
This is the DIME-style needs approach: Debt, Income, Mortgage, Education. Its virtue is that it starts from your household's actual obligations rather than a rule of thumb. Two people on identical salaries can land far apart — one with a paid-off home and grown children needs a fraction of what a young parent with a mortgage does.
A worked example, step by step
Take the figures the calculator opens with: an earner on ₱600,000 a year (₱50,000 a month), who wants 10 years of that income replaced, carries ₱1,000,000 in debts, expects ₱1,000,000 of future big expenses, and already has ₱500,000 set aside in existing insurance and liquid savings.
| Component | Working | Amount |
|---|---|---|
| Income replacement | ₱600,000 × 10 years | ₱6,000,000.00 |
| Debts to clear | Mortgage, car, personal loans, card balances | ₱1,000,000.00 |
| Future big expenses | Children's education, other known costs | ₱1,000,000.00 |
| Total need | Sum of the three above | ₱8,000,000.00 |
| Less: already set aside | Existing policies + liquid savings | − ₱500,000.00 |
| Additional coverage needed | ₱7,500,000.00 |
That works out to roughly 12.5× annual income. It is worth noting the multiple, because rules of thumb are usually quoted that way — but the multiple is an output here, not an input. A "10× salary" shortcut would have landed on ₱6,000,000, ₱1,500,000 short of the figure the actual obligations produce, because it never looks at the ₱1,000,000 of debt or the ₱500,000 already saved.
Coverage need at different income levels
Holding the other inputs constant (10 years of replacement, ₱1,000,000 of debt, ₱1,000,000 of future expenses, ₱500,000 already set aside), here is how the need scales with income:
| Annual income | Monthly | Income replacement | Total need | Coverage needed | × income |
|---|---|---|---|---|---|
| ₱300,000 | ₱25,000 | ₱3,000,000.00 | ₱5,000,000.00 | ₱4,500,000.00 | 15.0× |
| ₱600,000 | ₱50,000 | ₱6,000,000.00 | ₱8,000,000.00 | ₱7,500,000.00 | 12.5× |
| ₱900,000 | ₱75,000 | ₱9,000,000.00 | ₱11,000,000.00 | ₱10,500,000.00 | 11.7× |
| ₱1,200,000 | ₱100,000 | ₱12,000,000.00 | ₱14,000,000.00 | ₱13,500,000.00 | 11.3× |
| ₱1,800,000 | ₱150,000 | ₱18,000,000.00 | ₱20,000,000.00 | ₱19,500,000.00 | 10.8× |
Note how the multiple falls as income rises — from 15.0× at ₱300,000 down to 10.8× at ₱1,800,000 — because the fixed debts and savings are a smaller share of a bigger number. A single "multiply your salary by N" rule cannot be right for everyone.
How many years of income should you replace?
This is usually the largest single lever in the calculation, and the one people guess at. A reasonable anchor is: how long would your family need support before they could stand on their own income? Until the youngest child finishes school is a common answer; until a non-working spouse could return to work is another. On the ₱600,000 example:
| Years replaced | Income replacement | Coverage needed |
|---|---|---|
| 5 | ₱3,000,000.00 | ₱4,500,000.00 |
| 10 | ₱6,000,000.00 | ₱7,500,000.00 |
| 15 | ₱9,000,000.00 | ₱10,500,000.00 |
| 20 | ₱12,000,000.00 | ₱13,500,000.00 |
Each extra 5 years of replacement adds ₱3,000,000.00 to the figure here. Since premiums broadly scale with the sum assured, this is where a realistic answer saves you the most money — replacing 20 years of income for a family whose youngest child finishes school in 8 is buying protection you will pay for and never use.
Term vs VUL
Term insurance gives the most coverage per peso — best if your goal is pure protection. VUL (variable universal life) bundles insurance with investing; it costs more for the same coverage but combines both in one product. For protection alone, term usually wins; invest the difference separately (e.g. in MP2 or a savings plan).
"Invest the difference" is easy to say and easy to skip, so it is worth quantifying. If term costs you ₱2,000 a month less than a VUL for the same sum assured, and you actually put that ₱2,000 into a savings account earning 4% before the 20% final withholding tax (3.20% after), you would have ₱671,149.58 after 20 years on ₱480,000.00 of deposits. The catch is behavioural: a VUL forces the saving, whereas the difference on a term policy only gets invested if you set up the transfer and leave it alone. Be honest with yourself about which you would actually do.
Two structural points that matter more than the product label. First, the coverage amount comes first — an underfunded VUL that leaves your family short is worse than a plain term policy that covers the whole need. Second, check the term length against the horizon in the table above: a 10-year term that expires while you still need 15 years of replacement leaves a gap exactly when you are older and harder to insure.
Assumptions and limits of this estimate
- It is a planning estimate, not advice. A licensed advisor looking at your full situation may reasonably arrive at a different number.
- Income is treated as flat. The calculation multiplies today's income by the number of years, with no raises and no career change.
- No inflation or investment adjustment. A lump sum invested by your family would earn something, and prices would rise. The two pull in opposite directions and this method ignores both.
- Debts are taken at today's balance. An amortising mortgage shrinks each year, so the need falls over time — one reason to re-run this every couple of years rather than set it once.
- "Already set aside" is liquid money only. Include existing policies and accessible savings; do not include a house your family lives in or funds that would take years to release.
- The result is floored at zero. If what you have exceeds the total need, the calculator shows no additional coverage rather than a negative figure.
- Nothing here reflects premiums. What a given sum assured costs depends on your age, health, smoking status, occupation, and the insurer — this tool sizes the need, not the price.
Common mistakes
Insuring only the earner. A non-earning spouse who provides full-time childcare represents a real cost to replace. The income-replacement frame misses this entirely, so add the replacement cost under future expenses.
Counting illiquid assets as "already set aside." The family home is not a source of cash unless your family is willing to sell it — including it in the deduction understates the coverage you need.
Relying on employer group cover. It is genuinely valuable and belongs in the existing-coverage field, but it typically ends when employment does. Ask what happens to your number if that line disappears.
Buying the biggest policy you can afford instead of the one you need. Premiums come out of the same net pay as everything else. Size the need first, then check the premium against your take-home pay — a policy you lapse in year three protects nobody.
Setting it and forgetting it. A new child, a new mortgage, a paid-off loan, or a big raise all move the number. Re-run it whenever one of those happens.
Frequently asked questions
How many times my salary should I be covered for?
There is no single right multiple — it falls out of your own debts, horizon,
and savings. In the table above the same inputs produce anywhere from
10.8× to 15.0×
annual income purely because of income level. Use the calculation, not the
shortcut.
Should I include my mortgage in "debts"?
Yes — the outstanding balance, not the original loan amount. If you would
rather your family kept the home free and clear, this is the line that pays for
it. Check the current balance with the
home loan calculator.
Do SSS death benefits count?
Any benefit your family would actually receive reduces the gap, so it belongs
in the "already set aside" field alongside employer group cover and existing
policies. Just be conservative about amounts you are unsure of.
Does this include funeral and final expenses?
Not separately. If you want them covered, add them under future expenses rather
than assuming the income-replacement portion will stretch.
Why does the calculator show zero coverage needed?
Because the result is floored at zero: your existing insurance and liquid
savings already exceed the total need as you have entered it. That is a
legitimate answer, but re-check the inputs — a short replacement horizon or an
over-generous "already set aside" figure is the usual cause.
How often should I redo this?
Once a year is plenty in a stable period, plus immediately after any major
change: a birth, a marriage, a new loan, a paid-off loan, or a significant
change in income.
Want to know what you can budget for premiums? Start from your take-home pay. And if you are planning where to put the money you would otherwise pay into a bundled product, compare the Pag-IBIG MP2 calculator and the compound interest calculator.
Last updated: 2026-07-08. A planning estimate using the income-replacement / DIME method — not financial advice. Speak with a licensed financial advisor before buying a policy.