Planit:Critical Illness Calculator Case Study

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The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Contents 1 Example Problem One: 2 Solution Using Critical Illness Calculator: 3 Example Problem Two: 4 Solution Using Critical Illness Calculator: 5 Example Problem Three: 6 Solution Using the Critical Illness Calculator: 7 Example Problem One: 8 Solution Using Critical Illness Calculator: 9 Example Problem Two: 10 Solution Using Critical Illness Calculator: 11 Example Problem Three: 12 Solution Using the Critical Illness Calculator: 13 Example Problem One: 14 Solution Using Critical Illness Calculator: 15 Example Problem Two: 16 Solution Using Critical Illness Calculator: 17 Example Problem Three: 18 Solution Using the Critical Illness Calculator: 19 Example Problem One: 20 Solution Using Critical Illness Calculator: 21 Example Problem Two: 22 Solution Using Critical Illness Calculator: 23 Example Problem Three: 24 Solution Using the Critical Illness Calculator: 25 Example Problem One: 26 Solution Using Critical Illness Calculator: 27 Example Problem Two: 28 Solution Using Critical Illness Calculator: 29 Example Problem Three: 30 Solution Using the Critical Illness Calculator: 31 Example Problem One: 32 Solution Using Critical Illness Calculator: 33 Example Problem Two: 34 Solution Using Critical Illness Calculator: 35 Example Problem Three: 36 Solution Using the Critical Illness Calculator: 37 Example Problem One: 38 Solution Using Critical Illness Calculator: 39 Example Problem Two: 40 Solution Using Critical Illness Calculator: 41 Example Problem Three: 42 Solution Using the Critical Illness Calculator: 43 Example Problem One: 44 Solution Using Critical Illness Calculator: 45 Example Problem Two: 46 Solution Using Critical Illness Calculator: 47 Example Problem Three: 48 Solution Using the Critical Illness Calculator: 49 Example Problem One: 50 Solution Using Critical Illness Calculator: 51 Example Problem Two: 52 Solution Using Critical Illness Calculator: 53 Example Problem Three: 54 Solution Using the Critical Illness Calculator: 55 Example Problem One: 56 Solution Using Critical Illness Calculator: 57 Example Problem Two: 58 Solution Using Critical Illness Calculator: 59 Example Problem Three: 60 Solution Using the Critical Illness Calculator: 61 Example Problem One: 62 Solution Using Critical Illness Calculator: 63 Example Problem Two: 64 Solution Using Critical Illness Calculator: 65 Example Problem Three: 66 Solution Using the Critical Illness Calculator: 67 Example Problem One: 68 Solution Using Critical Illness Calculator: 69 Example Problem Two: 70 Solution Using Critical Illness Calculator: 71 Example Problem Three: 72 Solution Using the Critical Illness Calculator: 73 Example Problem One: 74 Solution Using Critical Illness Calculator: 75 Example Problem Two: 76 Solution Using Critical Illness Calculator: 77 Example Problem Three: 78 Solution Using the Critical Illness Calculator: 79 Example Problem One: 80 Solution Using Critical Illness Calculator: 81 Example Problem Two: 82 Solution Using Critical Illness Calculator: 83 Example Problem Three: 84 Solution Using the Critical Illness Calculator: 85 Example Problem One: 86 Solution Using Critical Illness Calculator: 87 Example Problem Two: 88 Solution Using Critical Illness Calculator: 89 Example Problem Three: 90 Solution Using the Critical Illness Calculator: 91 Example Problem One: 92 Solution Using Critical Illness Calculator: 93 Example Problem Two: 94 Solution Using Critical Illness Calculator: 95 Example Problem Three: 96 Solution Using the Critical Illness Calculator: 97 Example Problem One: 98 Solution Using Critical Illness Calculator: 99 Example Problem Two: 100 Solution Using Critical Illness Calculator: 101 Example Problem Three: 102 Solution Using the Critical Illness Calculator: Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

United States of America

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Argentina

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Brazil

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

United Kingdom

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of £60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to £60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require £174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of £40,000 for two years, as well as £50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to £40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to £50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need £78,505 to replace her income for the parameters specified, but would need £128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of £45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to £45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Russia

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of R60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to R60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require R174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of R40,000 for two years, as well as R50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to R40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to R50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need R78,505 to replace her income for the parameters specified, but would need R128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of R45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to R45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

China

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of ¥60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to ¥60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require ¥174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of ¥40,000 for two years, as well as ¥50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to ¥40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to ¥50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need ¥78,505 to replace her income for the parameters specified, but would need ¥128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of ¥45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to ¥45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Malaysia

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of RM60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to RM60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require RM174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of RM40,000 for two years, as well as RM50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to RM40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to RM50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need RM78,505 to replace her income for the parameters specified, but would need RM128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of RM45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to RM45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Singapore

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Hong Kong

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

India

The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of Rs60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to Rs60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require Rs174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of Rs40,000 for two years, as well as Rs50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to Rs40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to Rs50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need Rs78,505 to replace her income for the parameters specified, but would need Rs128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of Rs45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to Rs45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Caribbean

Jamaica The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $600000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $600000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $1749540 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $400000 for two years, as well as $500000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $400000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $500000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $785050 to replace her income for the parameters specified, but would need $1285050 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $450000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $450000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information. Trinidad and Tobago The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information. Barbados The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information. Bermuda The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information. Bahamas The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information. Puerto Rico The Critical Illness Calculator helps you determine the amount of critical illness insurance that the client will require. The Critical Illness Calculator illustrates the replacement of annual income for a specified number of years, plus any lump sum costs the client may experience such as exceptional health costs not covered by existing health insurance or government programs, possible costs for lifestyle changes and so on. If you want to pre-populate this calculator with information from the Client Data Entry screens, you must have entered the Personal Information for your client, as well as their earned income on the Cash Flow Management screen. This will override any defaults in the Age, Earned Income and Inflation Assumption fields. Example Problem One: A 40-year old man, with a current earned income of $60,000 wants to purchase a critical illness insurance policy to replace his income for 3 years. He has an inflation assumption of 3%, and an after-tax rate of return of 6%. He does not anticipate the need to cover any lump sum costs. How much insurance would be required to fund the replacement of his income? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter the age of 40 in the Current Age field Adjust the Current Earned Income field to $60,000. Set the Number of Years to Replace Income to 3, as the client indicated. Set the Inflation assumption to 3% Enter the After Tax Rate of Return assumption to be 6% Change the Lump Sum Costs field to zero. Click on the Calculate button at the bottom of the screen. As shown in the figure above, this man would require $174,954 to replace his income for the specified period of time. Example Problem Two: A 47-year old woman wants to be able to replace her income of $40,000 for two years, as well as $50,000 in lump sum expenses, in the case of her critical illness. She wants to assume an inflation assumption of 3%, and an after-tax rate of return of 7%. What are the funds required to replace income and the total insurance required? Solution Using Critical Illness Calculator: Select Critical Illness Calculator from the Calculators drop-down menu on the Home page. Enter 47 as the age of the client in the Current Age field. Adjust the Current Earned Income field to $40,000. Set the Number of Years to Replace Income to 2, as the client indicated. Leave the Inflation assumption at the default of 3% Set the After Tax Rate of Return to 7% Change the Lump Sum Costs field to $50,000. Click on the Calculate button at the bottom of the screen. As the Results section indicates, this woman would need $78,505 to replace her income for the parameters specified, but would need $128,505 of insurance coverage (because of her extra lump sum costs). To View the Critical Illness Report: Click on the Report button to view a summary report of data input and calculated insurance coverage required. Example Problem Three: Your clients' want you to combine all of their financial planning issues into one cohesive document. To produce the Integrated Financial Plan, you tell them you first need to plan for Critical Illness. After discussing it, they decided they would both like to plan for medical expenses of $45,000 and to replace income for 3 years. Solution Using the Critical Illness Calculator: After selecting the clients from the Client Search screen, use the Calculators drop-down menu to go directly to the Critical Illness Calculator. In order to upload as much completed information as possible, click the drop-down menu beside Scenario and choose the client’s Illness. Immediately, the following fields will have changed from default values, to data already entered on other screens: Current Age, Current Earned Income and Inflation. Adjust the # of Years to Replace Income to 3 Leave the After Tax Rate of Return assumption at the default. Change the Lump Sum Costs field to $45,000 Click on the Calculate button at the bottom of the screen. After reviewing the information, click the Save button so this information can be used in any documents you produce. Repeat these steps for the spouse with the same information.

Go to the exercise to test your knowledge on the Critical Illness Calculator