Insurance
Recommended liability
Protects what a claimant could reach: assets, future earnings and dependants.
The Formula
Recommended = assets + 3 x income + 25,000 x dependants
Protects what a claimant could reach: assets, future earnings and dependants.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| A | Assets | currency | Savings and property a claim could reach. |
| I | Annual income | currency | Income exposed to garnishment. |
| n | Dependants | count | People relying on your income. |
What Each Symbol Means
Acurrency
Assets
Savings and property a claim could reach.
Icurrency
Annual income
Income exposed to garnishment.
ncount
Dependants
People relying on your income.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate auto insurance coverage 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 Auto Insurance Coverage, filed under Finance. Every number the guide produces comes from substituting into this one line.