Tim and Allison are married and have two children, ages 12 and 14. Allison is a...

Tim and Allison are married and have two children, ages 12 and 14. Allison is a "nonworking" spouse who devotes all of her time to household activities. Estimate how much life insurance Tim and Allison should carry to cover Allison.

Life insurance need:

Solutions

Expert Solution

Solution. Let the Life Insurance amount begins with $ 20000.

To estimate how much insurance Tim and Allison should carry, multiply the number of years before their youngest child, reaches age 18 by $20,000.

2 year after the youngest child reach to the age of 18.

then,

Insurance needed = 2*$20,000

= $ 40,000

So,

$ 40,000 need for life insurance of which Tim and Allison should carry to cover Allison.

jeff jeffy answered 1 year ago

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