tm Ph.D.Life From the courtroom to the living room
Mortuos pluris es quam vivere! Sounds a little less scary when you say it in Latin.  But, despite what your spouse may have told you, you’re probably not worth more dead than alive.  Assuming you’re employed, you will make economic contributions to your family every year.  These contributions make up your human life value (i.e. how much you’re worth alive), and in most cases, this is a pretty high number.  Most likely, it will be more than the amount of life insurance you have in force (i.e. how much you’re worth dead). Here’s a simplified explanation of human life value Each year you earn income.  Part of that income goes to Uncle Sam, part of it is consumed by you personally, and the rest of it goes to your family to support their standard of living (savings, paying the bills, college education, buying groceries, etc.).  The part that goes to your family is called your net economic contribution.  Why net?  Because the contributions are net of taxes and your own personal consumption.  This happens year after year, for every year that you continue to work.  The present value of those net economic contributions is the amount of money that your family would need today to replace all those years of your contributions, if you aren’t around.  Like we said earlier, this is a simplified explanation - there are a few more moving pieces, but at least now you should have a general idea of what human life value means. Why is human life value important? The notion of human life value is a very common one in the world of life insurance (although it’s almost always measured incorrectly), and it’s also quite commonplace in the courtroom.  You see, if you die a wrongful death, your family typically is entitled to recover the economic contributions you would have made to them (your human life value).  So if the courts agree that your family should receive the full value of your net economic worth in the event that you die a wrongful death, what happens if you die a “normal” death, such as from a heart attack, where no one else is at fault?  Now, there’s no jury to award your family compensation.  Well, they’ll receive the proceeds from any life insurance you have...that’s it.  Do you have enough?  You’re already wondering how your life insurance coverage compares to your human life value, aren’t you?  Mission accomplished! So how do I come up with my human life value, and how can I use it? Visit our human life value estimator by clicking on the “HLV” link from the side menu.  But first, let’s discuss just a little bit more background about what we’re trying to accomplish here.  To estimate your human life value reliably, projections of your future earnings, consumption, and taxes must be made.  These projections cannot be made on an ad hoc basis.  They are not just simple assumptions or arbitrary guesses that a layperson (or life insurance agent) makes.  Economic literature shows that there are well-established techniques to estimate human life value – techniques used by certain types of economists all the time in both litigious and non-litigious arenas.  Not surprisingly, most sellers and consumers of life insurance are completely unaware that these scientific techniques exist.  Our goal is to bring this notion to light and educate both parties to a life insurance transaction, so that consumers will understand what asset (and how much of that asset) they’re actually insuring, and agents will have a legitimate tool at their disposal to help further this understanding.  We encourage you to visit our FAQ&A section to learn more about this. It should go without saying that an analysis of your human life value in a wrongful death case generally would use more detailed information than you are asked to provide here.  The tool we’re providing will give you a rough, but reasonably accurate, estimate – in other words, it’s as thorough as possible, using the limited information we ask you to enter. What are you waiting for?  Go find out what you’re worth!