Final answer:
The approach in question is the Needs approach, which ensures a family's financial requirements are fulfilled through insurance planning while considering the policy's death benefit and cash value.
Step-by-step explanation:
The approach used to make life insurance recommendations that calculates total funds available to a family from all sources and subtracts the amount needed to meet their financial objectives is known as the C) Needs approach. This approach is vital in ensuring that the family's financial security is met in the event of the policyholder's death. It factors in the cash-value (whole) life insurance which has a death benefit and can accumulate a cash value, serving as an account for use by the policyholder or their beneficiaries. Investment income earned on reserves, administrative costs, and risks are all considerations within this system. The aim of the Needs approach is to ensure that insurance payments cover the policyholder's claims, the insurance company's operational costs, and allow for profitability.