Step-by-Step - How to enter an endowment policy

Endowment policies are entered on the Protection > Term & Endowment screen.

1. To model an endowment, select Type, Personal Policy.

2. Select the owner of the endowment in the People panel.

3. Assuming the endowment is already owned by the client (i.e. presently an 'active' policy), choose Begin Premiums at Event (the default) and select the 'Start' event, in the Time panel (Event tab), located on the right side of the screen. A green dot will appear next to the selected event (see the  attached screen shot).

(In the event that an endowment is to be purchased in the future, select a future start event (green dot) on the Time panel or enter a purchase age).

4. Enter in the Benefit Amount field the amount of the endowment, i.e. the 'Sum Assured'. If the value of the policy is currently greater than the 'sum assured', you will have a chance to specify this, momentarily.

5. Enter the Term remaining until pay-out.

6. Enter the Annual Premium. The software will create an expense for this premium which does not show in the Expenses screen but doesl show in the Let's See > Detailed Info > Expenses tab. Be careful not to double count by including the endowment premium in expenses.

7. To model the policy as an endowment, expand the 'Payout at End of Term (Maturity)' panel, found under 'Advanced Settings'.

8. Tick the 'Receive Payout at End of Term' check box. This is used to model endowments and this is where you can specify whether you would like the software to pay-out the 'Sum Assured', already entered, or the maturity value, in the event of death and the tax treatment of this payment.

9. Click add (or Update) to save your changes.

Viewing Endowments Pay-outs in the Let's See Charts:

We intentionally hide lump sum benefit pay-outs (benefits that are not received in multiple payments) from protection policies from the Cash Flow chart, as these can be quite large and often skew the charts. These inflows are accounted for, however.

Keep in mind that the pay-out will occur in the year following the end of the term. For example, an endowment with 1 year remaining in the term will pay out the following year, in the second year of the plan. An endowment with five years remaining in the term will pay out in the 6th year of the plan.

To view these pay-outs, click the link to the “Detailed Info” link on the chart legend, which appears when you click the bars of the charts.

Scroll down to the bottom of the Cash Flow tab and look under the heading “Cash Flow – Not Displayed on Chart”.

Pay-outs can also be seen on the Protection tab.

Note that any portion of the endowment that is being used to fulfill expenses in the year of pay-out will be shown in the cash flow. This is easiest seen if you click the Detailed link in the panel at the bottom of the chart. You should see an Insurance category if any portion is being used for expense fulfillment. This split between pay-out as surplus inflow and any portion used for expense fulfillment will be shown when clicking on the bar/year of the chart when pay-out is to occur. The chart legend will display. Click the Detailed Info link. The chart details panel will display. Details of the inflow will be shown on the Cash Flow tab.