Critical Illness Insurance Needs Analysis

Critical Illness Insurance Needs Analysis is designed to help you guide clients through the financial implications of an adverse life event and see whether insurance would be valuable. Since the appropriate amount varies based on each client's unique financial situation, with this tool, you can estimate a suitable coverage.

On the Planning page, select Needs Analysis and then Critical Illness Insurance.

If your Planning page has a lower resolution or your window is smaller, the buttons will be displayed as icons. Click the button with the Needs Analysis symbol in the same location.

By default, there is one analysis per spouse, and you can include up to 4 analyses in total by clicking on the box with the "+" sign to the right. You can click anywhere in that box, not just by the "+" sign.

You can also delete extra analyses by scrolling to the bottom and clicking Delete.

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In the General section, you can choose the client or spouse from the dropdown box and add a description for the analysis.

• The Insured Person is the person who would experience the critical illness.
• The Analysis Description is optional but helpful when you have multiple analyses. This description will appear in the Summary table of your analysis and its Client Report page. For instance, you can write the assumptions for your calculation: how long the client would take off work, or how much they would need for medical expenses or home remodelling.

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The income replacement section estimates how much coverage a person would need to replace their and/or their spouse's income for a set period of time:

1. Determine the insured's Personal Income (annual amount, pre-tax). This may include employment income, pensions, or any other income. If you base the analysis on employment income only, you can import the amount from your projections by clicking within the text box and then selecting that option just above the data entry field.
2. Determine the Personal Income Percentage to be covered by the insurance policy.
3. Choose the Number of Months for which to replace this income.
4. Determine the Spousal Income (annual amount, pre-tax) and percentage to replace. If not included in the calculation, please put $0, 0% and for 1 month.

In the example below, the insured earns $100,000 per year (pre-tax). The goal is to replace 70% of that income for 12 months. Also added is 4 months' worth of the spouse's $80,000 pre-tax annual income.

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In the Liabilities section, you can specify any one-time, lump-sum additional expenses the Critical Illness policy will cover. A field for Medical Expenses is automatically included (which can be removed or renamed if desired).

• You can add a total of 5 custom liabilities using the plus sign.
• To remove liabilities, click the minus sign.
• To rename a liability, click its name and edit it in a pop-up window. Click Save.

All liabilities will be combined with the income replacement to determine the Total Critical Illness Insurance Required.

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In the Available Resources section, you’ll see two types of resources: Existing Critical Illness Insurance and Assets.

• Snap automatically includes any critical illness policies already entered in the projection. You can choose what percentage of each policy to include in the analysis.
• Snap also shows Financial and Real Assets from the client’s projections, and you can apply a percentage to include part or all of these in the calculation.

The Total Resources Available will be subtracted from the Total Critical Illness Insurance Required to determine the Extra Critical Illness Insurance Required.

In the example below, we are including 100% of the existing critical illness insurance policy but only 10% of the non-registered assets. No other assets, even if entered in the projections, will be used for the purpose of this analysis (left at 0%).

Your progress is saved automatically. At the bottom of the Setup page, there is a Saved/Edited indication. Once it indicates Saved, you can proceed directly to the Summary of the Critical Illness Needs Analysis.

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By default, Available Resources are based on the combined values for a couple. If you wish to enter values per person instead of combined, enable the Advanced Option at the bottom left of the page.

For example, this allows you to select resources from each spouse individually. You can use the non-registered assets of that individual, leaving the spouse's assets out of the calculation.

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The Summary page puts all of your entries together into a simple table. It shows the following:

• Income Replacement – the total amount (in black font) and the list of assumptions used in the calculation (in gray font).
• Liabilities – as entered in the analysis setup.
• Total Critical Illness Insurance Required – the amount of the lump-sum benefit the client would need to replace their income and cover liabilities.
• Existing Critical Illness Insurance used for the calculation and the amounts of other available resources, together combined into Total Resources Available.
• Extra Critical Illness Insurance Required – Total Critical Illness Insurance Required net of Total Resources Available.

To update the analysis and rename the description/liabilities, click Setup at the top of the page. 

To include the Summary in your report (if it's not already been included by default):

• Go to the Client Report -> Report Builder -> Included Pages, select Critical Illness Needs Analysis under the Gallery and drag and drop it to the list of Included Pages .

In the Report Editor, you can view the Critical Illness Needs Analysis and add comments.

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