The plan year in life insurance and financial planning refers to a 12-month period used for tracking policy anniversaries, premium payments, benefit accruals, and coverage reviews. It often begins on the policy's effective date and runs through the same calendar date one year later. Unlike the calendar year, the plan year is specific to each individual policy and serves as the timeframe for key administrative functions such as interest crediting, benefit resets, and annual statements. In cash value policies, the plan year determines how interest is credited and how surrender charges decline over time.

Advisors frequently review plan year anniversaries with clients to schedule annual policy reviews, adjust premium strategies, and ensure the policy is performing as intended. For example, in universal life insurance, interest crediting and cost of insurance deductions align with the plan year. If a client is planning a 1035 exchange, they may want to coordinate it with the end of the plan year for clean accounting. Underwriters and service teams also rely on the plan year to issue statements, monitor lapses, and calculate benefit changes tied to anniversaries.