Insurance
Monthly benefit
The share of income the policy is designed to replace.
The Formula
Benefit = income x coverage percent
The share of income the policy is designed to replace.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| I | Monthly income | currency | Gross monthly income to protect. |
| c | Coverage percent | percent | Share of income replaced, usually 50-70%. |
What Each Symbol Means
Icurrency
Monthly income
Gross monthly income to protect.
cpercent
Coverage percent
Share of income replaced, usually 50-70%.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate disability insurance page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate Disability Insurance, filed under Finance. Every number the guide produces comes from substituting into this one line.