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Self assessment calculator

One of the most important decisions you can make about your life insurance is the amount of cover you need.

To help you with this decision we have produced a simple self-assessment worksheet below. It should only take you about five minutes to complete. Just add your own details - you can use our example as a guide if you like.

In assessing your current situation, you may want to consider the gap between your needs and the amount of cover (if any) you already have.

Needs calculator
  Our example Your estimate  
Loans and debts ($)
Mortgage 170,000  
Other Loans (eg personal loan, credit cards) 15,000  
Lump sum to clear loans and debts 185,000 Line A
Monthly living expenses ($)
Rent (if applicable) 0  
Vehicle and transport (eg fuel, bus fares) 200  
Entertainment 100  
Your home (eg rates, electricity, insurance, repairs) 350  
Food 500  
Education/child care 400  
Other (eg clothing, shoes, grooming) 150  
Monthly total 1,700  
Multiply by 12 for annual living expenses 20,400 Line B
Years you wish to cover these expenses 15 Line C
Lump sum to cover living expenses 306,000 (BxC) Line D
Insurance Cover Gap ($)
Lump sum required to clear debts and cover living expenses 491,000 (A+D) Line E
Life cover insurance you have through superannuation 140,000 Line F
Life insurance from other policies and/or assets you could sell(eg shares) 40,000 Line G
Potential life insurance gap (LINE E - LINE F - LINE G) 311,000 Equals

* Think about how many years you need to cover these expenses.
For our example we have used 15, but you may feel more or less is required.

Important things to know

1. The purpose of this calculator is to estimate the amount of cover you need for life insurance.

2. This calculator is intended to provide general information only. It is provided by ClearView Life Assurance Limited ABN 12 000 021 581 AFSL No. 227682 ('ClearView') without taking into account your particular objectives, financial situation and needs.
This calculator is a financial model and cannot accurately predict how much insurance you might need. This will depend on:

  • all of your personal circumstances (including your particular objectives, financial situation and needs); and
  • unpredictable external factors.

This calculator generates factual information based on a limited range of issues and uses a set of assumptions to give you an indication of how your choices may affect the outcome. These assumptions and limitations are stated below.

3. While this calculator can be a useful tool, the information produced does not constitute a recommendation or statement of opinion about insurance and it should not be relied on for the purpose of making a decision in relation to a financial product. This calculator does not consider all of your personal circumstances and you should consider obtaining advice from a financial planner before making any financial decisions.

4. No assurance is given that this calculator is free of errors or suitable for any user's intended purposes.

Assumptions and limitations

The assumptions used to calculate the result and the limitations of this calculator are set out below. There is no guarantee that the assumptions are appropriate for your circumstances or accurately predict what will occur. You should also consider the limitations carefully as these will impact the result.

1. No allowance has been made for any taxation or levies as this will depend on your personal circumstances.

2. A real investment return of 2%pa, relative to AWOTE, is used to capitalise future expenses. That is, a 2% real return is used to convert required income streams to lump sums. This real return is broadly based on an assumed rate of AWOTE inflation of 4%pa and net investment return of 6%pa. 

The AWOTE assumption of 4%pa is 1.5%pa higher than the mid point of the Reserve Bank of Australia's target range for CPI inflation of 2%-3%pa. An untaxed return of 6%pa from conservatively invested funds is consistent with long term historic returns and may be an appropriate investment in some circumstances. 

The actual real return could vary substantially from this both because of the inherent volatility in wage inflation and investment returns and because of its dependence on the investment strategy adopted and the taxation status of the investment. 

Accordingly, if the capitalised future expenses component of the derived sum insured is a significant proportion of the total, then the user should seek advice as to a more appropriate after-tax real investment return to use.

3. The total values are the sum of expenses entered within the calculator.

4. No allowance has been made for any income received. It is only a calculation of the expenses entered.

ClearView consider these assumptions are reasonable as the purpose is to provide general information only.

If your actual situation differs from the assumptions made, then the calculations may differ from your actual amounts.

Assumption variables

The "Lump sum to cover living expenses" is based on an annuity formula using an assumed salary inflation rate (AWOTE) of 4.0% and an assumed net investment return of 6.0% (see assumption 2. above). You can changes these assumed rates below.

Net investment return (between 3% and 8%)    %  
Salary inflation rate (AWOTE) (between 2% and 4%)    %  

ClearView Life Assurance Limited ABN 12 000 021 581 AFSL No. 227682 issues life insurance products. Before deciding whether to acquire a ClearView product, please refer to the relevant Product Disclosure Statement (PDS), available online or by contacting 132 979 for details of the terms of the relevant product, including costs and exclusions that apply.


Products are issued by ClearView Life Assurance Limited ABN 12 000 021 581 AFSL No. 227682. Please refer to the relevant Product Disclosure Statement (PDS), available online or by contacting 134 135 for full details of exclusions, definitions and terms and conditions of the relevant product. Any advice on this website is general advice only and does not take into account your individual objectives, financial situation or needs. Before acting on it you should consider its appropriateness, taking into account your personal circumstances.

By accessing this website, you acknowledge that you agree to receiving the Bupa Australia Pty Limited/Bupa Australia Health Pty Limited Financial Services Guide (PDF, 2Mb) by downloading a copy.

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