Planners, Life Cover

 

This planner not only assesses how much life cover your client requires to meet his liabilities at death and maintain his dependants thereafter, but also assesses whether the cover required should be level, decreasing or increasing.

 

The following notes should be read in associate with those in “Planners, Starting & Warning”, “Planners, Default or Standard Values” and “Planners, Saving, Re-finding & Deleting”.

 

 

If you’re working with an EXISTING CLIENT the system will offer to pre-load the planner with children’s data from the fact find, as shown above. If you’re working with a CLEAR PLAN the above dialogue will not appear. 

 

On the first Life Cover screen, as shown below, enter or edit the client’s name, your assumed rate for inflation and the interest rate to use. On death it is assumed that all the current outstanding liabilities will be settled and the remaining sum will be invested at this interest rate in order to produce sufficient income to settle the future liabilities (e.g. school fees) as they become due.

 

Click the “+” and “-“ buttons to allow more or less children to be added to the plan, and enter their respective ages. When ready, press the PgDn key or click the black “Curve Right” button to move to the next screen.

 

 

On the following Assets & Liabilities screen, as shown below, enter the current value of disposable assets (e.g. car, but not the house unless the dependants can live elsewhere) and the growth rate of that asset. A car will typically devalue at around 15% (i.e. enter –15) while a building might increase by the same amount (i.e. enter 15). You can also edit the words “Disposable assets” to read “Car” or “Mercedes” or “Picasso” to make the plan clearer. Similarly enter values for the other fields in the “Assets” section. Likewise enter values in the “Liabilities” section, changing the text descriptions as required, then press the PgDn key or click the black “Curve Right” button to move to the next screen.

 

 

On the following Ongoing Income screen, as shown below, enter values in a similar fashion. The first section is for income guaranteed after death, such as from a FIB (i.e. Family Income Benefit) type policy. The next section is for income required after death, such as for supporting the spouse until the children leave home. The third section is for any school fees or university costs.

 

 

When you’ve entered all of the client’s current and future assets and liabilities press the PgDn key or click the black “Curve Right” button to move to the final screen, illustrated below, which shows the extra life insurance cover required to meet all outstanding liabilities if death should occur in the next few years. If the client is opting for level term assurance he should buy sufficient to match the highest figure listed. Alternatively he should consider whether the table shows an increasing, level or decreasing requirement, and select a suitable type of scheme.

 

 

When you’re satisfied with it you can save the plan, then subsequently re-find it, all as described above in the section on “Planners, Saving, Re-finding & Deleting”.

 

To print the completed plan…