In this video, we walk through how to use the software to model Term Life and Disability Insurance.
Transcript
Today, we're going to walk through how to model term life and disability insurance policies in Voyant. We’ll be looking at the US version of the product, and I’ll be giving you tools to assess your clients’ coverage needs. By the end of this session, you’ll be able to provide customized, comprehensive advice showing the importance of these strategies in protecting clients against unexpected life events.
Please note that this session is being recorded, and we will send out a recording within 24 hours of the webinar’s conclusion. We won’t be taking live questions during the session, but feel free to reach out afterward at support@planwithvoyant.com if you have any questions.
Today, we’ll be looking at Shaun and Jean Monroe, a couple in their mid-40s with a young child. We’ll explore two key scenarios:
Term Life Insurance Needs: Ensuring that they have sufficient coverage to financially protect their family in the event of an untimely death.
Disability Insurance Needs: Evaluating the need for disability coverage should either spouse be unable to work for an extended period.
Let’s start by going to the Insight section and scrolling down to the Life Needs Insight. We’ll assess this couple’s need for term life insurance. Currently, they have no insurance policies in their plan, so we’ll be starting from scratch.
The system simulates mortalities in the second year of the plan and provides insights into the financial picture if one spouse were to pass unexpectedly. You can view the chart for either spouse: the primary or the secondary, and see how their passing would affect the client’s plans. You can also use the year view to get a clearer picture.
For example, in the first year, Jean’s income of $110,000 is included in the plan. In the second year, when we simulate her mortality, her income falls out of the plan. Shaun receives some Social Security survivor benefits, and any contributions to her 401(k) have stopped and been transferred into a beneficiary IRA in Shaun’s name. This is how the software simulates her passing and calculates the resulting numbers.
Using this simulation, we can add term life policies based on these numbers. One option is to create a what-if scenario with slightly reduced expenses, but in this example, we’ll keep expenses the same.
From the Dashboard, go to the Insurance tab and select Term Life. For Shaun, we’ll add a personal term life policy: a 20-year term with a benefit amount of $1.2 million and a premium of $75 per month. Ensure the spouse is listed as the beneficiary, then save.
Next, add a policy for Jean: a 20-year personal term life policy with a benefit amount of $1.6 million and a premium of $90 per month, with her spouse as the beneficiary. Click Done to save.
Returning to the Insight, you can run the simulation and show how the clients would be protected in the event of an untimely death. The system will show that no additional life insurance is needed. In the Year View, scroll to the simulated mortality event to see the life insurance payout reflected in cash flow. You can also view the Legacy Overview to simulate what would happen if both spouses died today, giving an estimate of the wealth transferred to their child.
Next, let’s look at a Disability Insurance scenario. Go to the Disability Insurance Insight and run it for 3 years at age 55 for both Jean and Shaun. For Jean, this simulates an income loss of $271,000 over those years. Since her income is unavailable, they must draw from liquid assets to cover expenses, affecting retirement savings and overall asset growth. Comparing the plan with and without the disability event shows the long-term impact on their assets.
Repeat the simulation for Shaun to see the effect of income loss on liquid assets. This helps visually demonstrate the value of disability insurance to protect overall assets.
To add disability policies, go to the plus button, select Insurance, and add a policy for Shan with an estimated coverage of $85,000 per year for 3 years. For Jean, add a policy with $90,000 coverage per year for 3 years, with estimated premiums of $25 per month.
Re-running the simulation with these policies shows that the insurance covers the income loss, so they don’t need to draw from their liquid assets. The value of having protection in place is clearly demonstrated, helping clients understand the importance of these policies.
Thank you for attending today’s webinar on modeling term life and disability insurance policies in Voyant. These tools help protect your clients’ financial security.
If you have further questions or would like one-on-one assistance, reach out to support@planwithvoyant.com. You can also share a plan for review by clicking the client’s name in the top right corner, selecting Request Support, entering your question, and sharing client access. I’d be happy to set up a time to review your plans and help you prepare for upcoming client presentations.