The Summary tab of the Life Insurance Analysis provides clean, easy-to-understand visuals that allow you to compare a client's estimated protection need to any current or proposed insurance coverage. The Life Insurance Analysis can be found within the Insurance > Life Insurance tab of each client plan:
Joint vs. Single Life Insurance Analysis
You will only see a Summary tab when using the Life Insurance Analysis for a joint household. For more information on the Life Insurance Analysis for single clients, click here.
Within joint plans, the Life Insurance Analysis will run a set of side-by-side projections: one for the client, and another for the co-client. Each projection is simulating a very specific what-if scenario:
"If the client / co-client passes away next year, will the surviving client run out of money before the end of their plan?"
Each projection considers the surviving client's remaining income and investments to determine whether or not they can make it to the end of their planning horizon without running out of assets. If either client runs out of money in their projection, a Protection Need will be calculated and displayed- this value represents the amount of insurance that would ensure the surviving client would not run out of money:
Pro-Tip: Inheriting Assets
You can adjust the percentage of assets that a surviving spouse will inherit within the Gear Icon > Settings > Account Assumptions section of the plan. This will impact the protection need generated for each client.
Any current life insurance coverage that is entered into the Net Worth section of the Profile will feed into the Life Insurance Analysis as Current coverage. The death benefit will enter the client's cash flow projections at the end of the first year.
You can use the Action Items at the bottom of the page to adjust income, expenses, goals and more for each projection. You can also simulate Proposed insurance, to demonstrate the value of additional coverage to clients:
Important Note: Protection Need
Please note that the protection need being calculated is not an exact amount of recommended insurance for each client. Rather, it is the minimum death benefit required to ensure that the client ends their life with at least $1 left to their name.
It is also important to remember that the protection need is an estimate based on the assumed plan variables for each projection (see Action Items - Life Insurance).
