If you could outline some gaps in insurance coverage, and some recomendations on what they could do better.
John (age 37) and Anna (age 38) Tolbert are married and live in Columbia, Missouri. They have a daughter, Casey Tolbert (age 8). Anna is a physician's assistant and John teaches at the University of Missouri. Casey attends a private elementary school in Columbia. John and Anna have a pool in their backyard and just purchased a trampoline for Casey. Casey also has a dog. Anna has $26,000 in cash hidden under her mattress in the event an emergency arises. John and Anna purchased their primary residence five years ago for $250,000. Their down payment was $12,500 and the remainder was a mortgage. The APR on the mortgage is 3.5%. The replacement value of the home is $260,000. The Tolbert's took out a 5-year auto loan for $25,000 one year ago. The APR on the loan is 6%. The Tolbert's have a standard HO-3 policy. Their home is covered for $195,000 (Coverage A). Their HO-3 policy provides $300,000 of liability protection. Both of the Tolbert's cars are covered using the minimum liability limits required by state law. They have collision and comprehensive coverage on both cars and a $250 deductible. The Tolbert's each have $150,000 of group term life insurance through their employers. John pays $5.22 and Anna pays $6.02 per month, after-taxes, for the group term life insurance. John has an "any occupation" disability policy through the University of Missouri that replaces 60% of his gross salary. Anna and Casey are covered under John's health insurance plan through the University of Missouri. John and Anna have asked you, their financial planner, to put together the risk management section of their financial plan. You may work with a partner or alone. The financial plan should include the following: 1. One-page executive summary that outlines the recommendations 2. The different areas of risk exposure 3. Your recommendations and justifications Areas Details Executive Summary Outline of recommendations Homeowners Insurance Gaps in coverage(s) identified and recommendations provided (including justification). Tax implications should be provided, if applicable. Auto Insurance Life Insurance Disability Insurance Other Insurance Non-insurance recommendations Areas of potential risk exposures identified and recommendations of risk prevention techniques provided Quality Easy to understand and was able to defend recommendations. Each section clearly laid out Cash Flow Statement Balance Sheet Cash Inflows: Monthly Assets: Anna paycheck (net): S 6,209.00 Primary Residence FMVS 240,000.00 John paycheck (net): S 4,801.00 Auto 1 (Honda Accord) S 21,500.00 Total inflows $ 11,010.00 Auto 2 (GMC Truck) S 1,600.00 Jewelry S 18,450.00 Cash Outflows: Monthly Gun Collection S 3,500.00 Mortgage (Primary Home) 1,066.00 Triathlon Bikes S 5,500.00 Auto 1 S 483.00 Furniture S 45,000.00 Student Loan S 754.00 401(k)s S 40,000.00 Credit Cards S 300.00 Investments S 25,000.00 Grade School Tuition $ 600.00 Total Assets $ 400,550.00 Daycare 800.00 Groceries 840.00 Liabilities: Utilities 1,200.00 Primary Mortgage $ 213,031.00 Entertainment 600.00 Auto 1 S 20,580.00 401(k)s S 900.00 Student Loan S 59,844.00 Investments $ 1,000.00 Credit Cards S 6,000.00 Total Outflows $ 8,543.00 Grade School Tuition S 43,200.00 Total Liabilities $ 342.655.00 Monthly Net Income $ 2,467.00 Net Worth $ 57.895.00 S S S S John (age 37) and Anna (age 38) Tolbert are married and live in Columbia, Missouri. They have a daughter, Casey Tolbert (age 8). Anna is a physician's assistant and John teaches at the University of Missouri. Casey attends a private elementary school in Columbia. John and Anna have a pool in their backyard and just purchased a trampoline for Casey. Casey also has a dog. Anna has $26,000 in cash hidden under her mattress in the event an emergency arises. John and Anna purchased their primary residence five years ago for $250,000. Their down payment was $12,500 and the remainder was a mortgage. The APR on the mortgage is 3.5%. The replacement value of the home is $260,000. The Tolbert's took out a 5-year auto loan for $25,000 one year ago. The APR on the loan is 6%. The Tolbert's have a standard HO-3 policy. Their home is covered for $195,000 (Coverage A). Their HO-3 policy provides $300,000 of liability protection. Both of the Tolbert's cars are covered using the minimum liability limits required by state law. They have collision and comprehensive coverage on both cars and a $250 deductible. The Tolbert's each have $150,000 of group term life insurance through their employers. John pays $5.22 and Anna pays $6.02 per month, after-taxes, for the group term life insurance. John has an "any occupation" disability policy through the University of Missouri that replaces 60% of his gross salary. Anna and Casey are covered under John's health insurance plan through the University of Missouri. John and Anna have asked you, their financial planner, to put together the risk management section of their financial plan. You may work with a partner or alone. The financial plan should include the following: 1. One-page executive summary that outlines the recommendations 2. The different areas of risk exposure 3. Your recommendations and justifications Areas Details Executive Summary Outline of recommendations Homeowners Insurance Gaps in coverage(s) identified and recommendations provided (including justification). Tax implications should be provided, if applicable. Auto Insurance Life Insurance Disability Insurance Other Insurance Non-insurance recommendations Areas of potential risk exposures identified and recommendations of risk prevention techniques provided Quality Easy to understand and was able to defend recommendations. Each section clearly laid out Cash Flow Statement Balance Sheet Cash Inflows: Monthly Assets: Anna paycheck (net): S 6,209.00 Primary Residence FMVS 240,000.00 John paycheck (net): S 4,801.00 Auto 1 (Honda Accord) S 21,500.00 Total inflows $ 11,010.00 Auto 2 (GMC Truck) S 1,600.00 Jewelry S 18,450.00 Cash Outflows: Monthly Gun Collection S 3,500.00 Mortgage (Primary Home) 1,066.00 Triathlon Bikes S 5,500.00 Auto 1 S 483.00 Furniture S 45,000.00 Student Loan S 754.00 401(k)s S 40,000.00 Credit Cards S 300.00 Investments S 25,000.00 Grade School Tuition $ 600.00 Total Assets $ 400,550.00 Daycare 800.00 Groceries 840.00 Liabilities: Utilities 1,200.00 Primary Mortgage $ 213,031.00 Entertainment 600.00 Auto 1 S 20,580.00 401(k)s S 900.00 Student Loan S 59,844.00 Investments $ 1,000.00 Credit Cards S 6,000.00 Total Outflows $ 8,543.00 Grade School Tuition S 43,200.00 Total Liabilities $ 342.655.00 Monthly Net Income $ 2,467.00 Net Worth $ 57.895.00 S S S S
