What’s a Year of Your Life Worth?

photo credit: hans s

Let’s pretend for a minute that you could decide what a year of your life would be worth. That decision would be based on what you felt a year of ‘quality life’ would be worth for you to have to give up, forgetting about any life insurance policies or coverage that you may have. It will probably be a very hard figure for you to come up with and will depend on whether you’re young and single or older with a family depending on you to take care of them. Would it be one million dollars? More? Less?

Life is Worth Less Than You May Think

Well, would you believe that the value of a year of life has been calculated and standardized by life insurance companies as being worth…are you ready for this?

$50,000.

Yup. That’s it. Barely a year’s salary for most people these days. While some studies have worked to place a much higher figure on treatments that can help people with health issues live longer lives, the health and life insurance companies – as well as most government agencies – still use the $50,000 figure as the standard when calculating medical treatments or insurance coverage. Using a dollar figure to represent the value of a human life, may seem to be in very bad taste, but most institutions and agencies dealing with life and death routinely use this sort of dollar figure to calculate a variety of values.

Still, calculating the amount of your life insurance benefit on this statistic alone may not be the best barometer. Stanford scientists have challenged the $50,000, and say that a year of life is actually worth around $129,000. The Stanford School of Business calculation is based largely on the cost of kidney dialysis, which is then adjusted for quality of life (according to the study, one year of “quality life” is equivalent to two years on dialysis).

What About Life Insurance for the Military

For instance, the $500,000 that the government pays out to families of American soldiers killed in Iraq or Afghanistan isn’t really meant to replace the value of that person’s life. The pay out is merely to help the family of the slain soldier better deal with getting on with the rest of their lives. It’ll never replace the soldier in their lives, but again…the government agency needed a dollar value and a committee somewhere decided on $500,000 as the figure.

Source

• Time Magazine. http://www.time.com/time/health/article/0,8599,1808049,00.html.
  

Tags: Life Insurance, value of life, worth of life

This entry was posted on Monday, November 3rd, 2008 at 7:46 pm and is filed under Life Insurance, Prolonging Life, Stats. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.