Short answer: Start with your remaining mortgage balance, then add a cushion for income your family would lose, plus any big future costs like education. Subtract life insurance you already have. Choose a term at least as long as the years left on your mortgage.
The 4-step formula
- Mortgage balance: what you still owe today.
- + Income cushion: a few months to a few years of your income, so your family has time to adjust.
- + Big future costs: education, debts, or final expenses you want covered.
- − Existing coverage: life insurance you already own (personal policies count more than work policies, which can end if you leave your job).
Want to run your own numbers? Use our free mortgage protection calculator. It also estimates your term and shows your balance against your coverage over time.
How long should the term be?
Match your term to the years left on your loan, rounded up to the nearest available term (10, 15, 20, 25, or 30 years). If you have 22 years left, a 25-year term covers the whole loan. If kids will still be at home after the mortgage is paid, you might choose a longer term.
Level or decreasing coverage?
Your balance shrinks over time, so some people consider decreasing term. But your family's other needs don't shrink, and level term often costs only a little more. Read decreasing vs. level term.
Common sizing mistakes
- Counting only on work life insurance, which usually ends when you leave the job
- Forgetting a stay-at-home spouse, whose loss also has real costs
- Choosing a term shorter than the mortgage to save a few dollars
- Buying far more than needed and stretching the budget
Frequently asked questions
Should my coverage equal my mortgage balance?
That's the minimum starting point. Many families add an income cushion and other needs, then subtract existing coverage.
Should both spouses get mortgage protection?
Often yes. If either spouse's death would make the mortgage hard to afford, both may benefit from coverage. Some carriers offer joint policies, though separate policies are more common.
What if I refinance?
A personal term policy stays in force when you refinance. Review your coverage if your balance or term changes a lot.
This guide is general educational information, not a quote, tax, legal, or financial advice. Coverage, features, and availability vary by carrier and state and are subject to underwriting.
