Insurance Coverage

This page covers the following location(s) in NaviPlan:

Enter Financial Data - Insurance Coverage - Insurance Coverage

Enter Financial Data - Insurance Coverage - Insurance Coverage - Life Insurance Details

Enter Financial Data - Insurance Coverage - Insurance Coverage - Disability Insurance Details

Enter Financial Data - Insurance Coverage - Insurance Coverage - Long-term Care Insurance Details

Planning Objectives :: Procedures :: Screen Notes :: Related Information

Planning Objectives

Note: If you have selected the Client(s) are already retired option during plan creation, some of the details below may not appear or apply.

ClosedWhat insurance assumptions does NaviPlan make?
  • In the event of the death or disability of either the client or the co-client, NaviPlan assumes that 100% of the following needs will be required by the surviving/non-disabled client:
    • monthly expenses
    • liabilities
    • education goal needs
    • major purchase goal needs
    • retirement goal needs
  • In the event of the death of both the client and the co-client, NaviPlan assumes that 100% of the following needs will continue:
    • Education goals for any surviving children
    NaviPlan assumes the following needs will end:
    • monthly expenses
    • liabilities (NaviPlan assumes there is no insurance on the loans and that the liabilities will be netted against the assets at the time of death)
    • major purchase goal needs
    • retirement goal needs
  • For long-term care (LTC) calculations, NaviPlan assumes that the clients do not have long-term care insurance. The default start age for LTC is 80 with a duration of 4 years.
ClosedWhat disability insurance policy assumptions does NaviPlan make?
  • The following disability insurance policy types are available in NaviPlan:
Disability Insurance Policy Type: Assumptions:
Short-term
  • The policy type is Group STD.
  • The benefits are taxable.
  • The premiums cease at retirement.
  • The waiting period is two weeks.
  • The benefits will be paid for three months.
  • Benefits are offset by Social Security.
Long-term
  • The policy type is Group LTD.
  • The benefits are taxable.
  • The premiums cease at retirement.
  • The waiting period is three months.
  • The benefits will be paid until the insured reaches 65 years of age.
  • Benefits are offset by Social Security.
Individual
  • The policy type is Individual.
  • The monthly benefit is a flat dollar amount; no percentages of salary are permitted.
  • The benefits are non-taxable.
  • The waiting period is three months.
  • The benefits will be paid until the insured reaches 65 years of age.

Procedures

ClosedHow do I add details for a life insurance policy?
  1. From the Insurance Coverage page, click Details for the policy you wish to edit.
  2. Review the basic information you have entered in the following fields:
    • Description
    • Policy Type
    • Insured
    • Beneficiary
    • Policy Owner
    • Cost Basis
    • Tfr to Survivor
  3. Enter Benefit Details.
    • Enter a Death Benefit and make a selection from the Direct Residual Proceeds To menu.
    • Use the At Age and/or On Date fields to specify the date on which coverage from the policy will end (if applicable).
    • If applicable, select the Community Property option.
  4. Enter Premiums information.
    • Indicate the Payer of the premiums, the premium Amount, and Frequency.
    • Use the At Age and/or On Date fields to specify the date on which premiums for the policy will end (if applicable).
    • Select Waived at Disability, if the clients plan to stop making payments on this policy if the insured becomes disabled.
  5. If applicable, enter information for any Variable Subaccounts.
    • The general account is included by default.
    • To enter a new subaccount click Add Variable Subaccount and enter account details.
      Note: NaviPlan includes a new subaccount for you by default. For the first subaccount you add, you do not need to click Add Variable Subaccount, instead you can simply edit the row NaviPlan has included for you.
    • For more information on adding account details, see the Account Details page.
      For more information on classifying an asset, see the Asset Class Weightings page.
  6. By default, NaviPlan calculates the premium schedule, future values of death benefits, and prospective cash surrender value for an insurance policy each year.
    However, if you wish, you can make changes to NaviPlan's calculated values.
    • Select Modify the Calculated Values and enter new data in the appropriate fields.
      OR
      You can use the Fill Values section to quickly populate fields in the Future Benefits section. From the Fill Values section, click Clear Column Values, enter data for all relevant fields, then click Fill. The selected column populates with data per your specifications.
    • You can repeat these steps for each period shown at the bottom of the Future Benefits section, select each link to view and/or modify calculated values for that period.
  7. When you are satisfied with these options, click OK.
ClosedHow do I add details for a disability insurance policy?
  1. From the Insurance Coverage page, click Details for the policy you wish to edit.
  2. Review the basic information you have entered in the following fields:
    • Description
    • Policy Type
    • Insured
    • Policy Owner
    • Effective Date
  3. Enter Benefit Amount details.
    • Select either a Flat Dollar amount or a % of Salary amount for the insured.
    • Select a Benefit Frequency from the menu.
    • Indicate whether or not the benefit is a Taxable Benefit.
    • If applicable, use the Infl and the +/- Add'l fields to index the Benefit Amount.
  4. Set the Maximum Indexed Benefit.
    • Make a selection from the Calculated As menu, or enter a Dollar Amount.
    • Define the Waiting Period and Benefit Period.
    • If applicable, select the Offset by Social Security option.
  5. Define Premiums.
    • Review the Payer for the policy's premiums.
    • Enter an Amount and Frequency for the premium.
    • Set an end date for the premium payments using the At Age and/or On Date fields.
    • If applicable, use the Infl and the +/- Add'l fields to index the premium payments.
  6. When you are satisfied with these options, click OK.
ClosedHow do I add details for a long-term care insurance policy?
  1. From the Insurance Coverage page, click Details for the policy you wish to edit.
  2. Review the basic information you have entered in the following fields:
    • Description
    • Company
    • Policy Number
    • Insured
    • Effective Date
  3. Enter the Benefits Payable.
    • Enter an Amount and Frequency.
    • Use the Infl and Add'l +/- fields to define the rate of indexation for benefits. Define this rate for the LTC period as well as for the pre-LTC period.
  4. Set the Applicable Period.
    • Define the Waiting Period and the Benefit Period for the policy.
  5. Define Premiums.
    • Review the Payer for the policy's premiums.
    • Enter an Amount and Frequency for the premium.
    • Set an end date for the premium payments using the At Age and/or On Date fields.
    • If applicable, use the Infl and the +/- Add'l fields to index the premium payments.
  6. When you are satisfied with these options, click OK.

Screen Notes

ClosedInsurance Coverage Report
  • Use this button to generate the Insurance Coverage standalone report.

Related Information




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