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Can we model receiving term insurance death benefits?

Submitted by finserve on 23 September 2009 - 3:46pm

I understand that ESPLanner uses life insurance information for comparison only. Users are to match their existing coverage with the program's recommendations.

However, is it possible to model receiving a term life policy's death benefit?

I am modeling the death of my husband before retirement, while he has an employer-provided term life policy. I entered the benefit as a Special Receipt that is not taxable. I also entered the policy in Estate, Life Insurance, of course.

The report shows the income in the year he dies, but it also shows taxes due on the income.

Thanks,

Ruth

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Submitted by Dick Munroe on 24 September 2009 - 9:37am.
1

You should be able to do so using contingent planning and providing a contingent special receipt amounting to the death benefit. If it's not taxable, make sure to make it not-taxable.

Best,

Dick Munroe

Submitted by Dan Royer on 25 September 2009 - 8:19pm.
2

If I understand your question, if ESPlanner is recommending insurance, then you would also assume that this amount is paid out in that death year. In other words, be sure to reconcile whatever you are figuring on the side with whatever amounts ESPlanner has already integrated into your plan.

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