Planit:Entering and Analyzing Insurance Coverage Case Study

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When transitioning from a Single Needs Analysis to Life Goals planning, many aspects of your analysis will change in the event that the client or spouse die or become disabled. As such, new needs to protect against the erosion of their estate, capital shortfall for life goals, or to reduce retirement lifestyle are introduced. For the advisor, there is a new need to enter the existing insurance coverage of your clients and determine if they are over or under insured. Contents 1 Example Problem One: 1.1 Solution using Summary Insurance Coverage: 2 Example Problem One: 2.1 Solution using Summary Insurance Coverage: Example Problem One: Donna and Harold Woodhaven want to know if they have enough insurance coverage, so have given you some information on their policies. Harold has permanent life insurance with a benefit of {{{life insurance}}}, and Donna has a small permanent life insurance policy worth {{{insurance policy}}}. They both have Group insurance through their work for a value of {{{group insurance}}} each. Harold has some disability insurance through work with a benefit of {{{disability insurance per month}}} per month. This benefit is not indexed. {{{female name}}} has purchased a small disability policy herself with a benefit of {{{disability insurance 2}}} per month, which is indexed to inflation. Click here to see an example of entering summary insurance that pays out on either death or disability but not both. Click here to see an example of entering summary Islamic takaful instead of conventional insurance. Solution using Summary Insurance Coverage: Click on the link to the Insurance screen. Under Client’s Permanent Insurance enter {{{life insurance}}} for Harold’s permanent life coverage Under Client’s Term/Group Insurance, enter {{{group insurance}}} for the benefit provided through Donna’s work. In the Spouse’s Permanent Insurance field, enter the {{{insurance policy}}} of coverage Donna has. Set the Spouse’s Term/Group Insurance to {{{group insurance}}} In the disability section, set the Client’s Annual Income Benefit to {{{client's annual income benefit}}}, since he would receive {{{disability insurance per month}}} per month, equivalent to {{{client's annual income benefit}}} each year. Under Client’s Index Rate on Benefits, leave it at the default of 0.0%, since they are not indexed. The Will benefits be subject to income tax drop-down menu should be set to “Yes”, based on the ownership of the policy. The Spouse’s Annual Income Benefit should be set to {{{annual income benefit}}}, since she would receive {{{disability insurance per month 2}}} per month, which multiplied by twelve gives {{{annual income benefit}}} per year. Under Spouse’s Index Rate on Benefits, enter the clients' inflation assumption, as you would enter on the Personal Information screen. The Will benefits be subject to income tax drop-down menu should be set to “No”, based on the ownership of the policy. Click Save at the bottom of the screen To determine the clients' need on death or disability given the insurance policies just entered, you could either use the Life Insurance and/or Disability Insurance Calculators, or produce a document such as the Personal Financial Strategy in the Your Working Documents screen.

United States of America
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Argentina
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Brazil
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United Kingdom
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Russia
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China
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Malaysia
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Singapore

When transitioning from a Single Needs Analysis to Life Goals planning, many aspects of your analysis will change in the event that the client or spouse die or become disabled. As such, new needs to protect against the erosion of their estate, capital shortfall for life goals, or to reduce retirement lifestyle are introduced. For the advisor, there is a new need to enter the existing insurance coverage of your clients and determine if they are over or under insured. Example Problem One: Alvin and Grace Cheng want to know if they have enough insurance coverage, so have given you some information on their policies. Grace has permanent life insurance with a benefit of {{{life insurance}}}, and Alvin has a small permanent life insurance policy worth {{{insurance policy}}}. They both have Group insurance through their work for a value of {{{group insurance}}} each. Grace has some disability insurance through work with a benefit of {{{disability insurance per month}}} per month. This benefit is not indexed. {{{female name}}} has purchased a small disability policy herself with a benefit of {{{disability insurance 2}}} per month, which is indexed to inflation. Click here to see an example of entering summary insurance that pays out on either death or disability but not both. Click here to see an example of entering summary Islamic takaful instead of conventional insurance. Solution using Summary Insurance Coverage: Click on the link to the Insurance screen. Under Client’s Permanent Insurance enter {{{life insurance}}} for Harold’s permanent life coverage Under Client’s Term/Group Insurance, enter {{{group insurance}}} for the benefit provided through Alvin’s work. In the Spouse’s Permanent Insurance field, enter the {{{insurance policy}}} of coverage Donna has. Set the Spouse’s Term/Group Insurance to {{{group insurance}}} In the disability section, set the Client’s Annual Income Benefit to {{{client's annual income benefit}}}, since he would receive {{{disability insurance per month}}} per month, equivalent to {{{client's annual income benefit}}} each year. Under Client’s Index Rate on Benefits, leave it at the default of 0.0%, since they are not indexed. The Will benefits be subject to income tax drop-down menu should be set to “Yes”, based on the ownership of the policy. The Spouse’s Annual Income Benefit should be set to {{{annual income benefit}}}, since she would receive {{{disability insurance per month 2}}} per month, which multiplied by twelve gives {{{annual income benefit}}} per year. Under Spouse’s Index Rate on Benefits, enter the clients' inflation assumption, as you would enter on the Personal Information screen. The Will benefits be subject to income tax drop-down menu should be set to “No”, based on the ownership of the policy. Click Save at the bottom of the screen To determine the clients' need on death or disability given the insurance policies just entered, you could either use the Life Insurance and/or Disability Insurance Calculators, or produce a document such as the Personal Financial Strategy in the Your Working Documents screen.

Hong Kong
{{{Hong Kong Workbook Template}}}

India
{{{India Workbook Template}}}

Caribbean
Jamaica {{{Jamaica Workbook Template}}} Trinidad and Tobago {{{Trinidad and Tobago Workbook Template}}} Barbados {{{Barbados Workbook Template}}} Bermuda {{{Bermuda Workbook Template}}} Bahamas {{{Bahamas Workbook Template}}} Puerto Rico {{{Puerto Rico Workbook Template}}}

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