Insurance Rules of Thumb
The 10x Income Rule
A standard baseline for Life Insurance. Experts recommend purchasing a policy that covers at least 10 to 12 times your current gross annual income to ensure long-term family stability.
The Deductible Trade-off
There is an inverse relationship in insurance math: Raising your out-of-pocket deductible will lower your monthly premium, while lowering your deductible will increase your monthly premium costs.
The 80% Property Rule
To be fully reimbursed for partial home damage without penalties, most insurers require your dwelling coverage limit to equal at least 80% of your home's total replacement cost.