Life Insurance and Living Benefits

While there are many different types of life insurance in Canada, the correct type of insurance will be determined by your personal needs and financial position in life. This blog concentrates only on the cost of 10 and 20 year term insurance, and the difference can be huge. Term insurance is a policy which provides a death benefit for a predetermined amount of coverage. The death benefit is guaranteed in a standard policy and the premium is locked in for the period of the term, 10 years or 20 years, depending on the policy. For a 10 year term plan, your premiums will remain the same for 10 years. After that, a policy can renew (no medical required) and your premium increases to a new premium which is listed in the policy. This way there are no surprises. If you do not want to continue with the policy, simply stop paying premiums and the policy will lapse. Continue paying the premium and you may keep the policy until the policy expires at age 75, for example. The likel...

I have been in the insurance business for over 30 years and a question that continues to arise is, “What is the best type of insurance to own?” Is it term insurance or whole life insurance? Experience tells me that the best insurance to own is the type of insurance that is in force when you die! I have never had a family approach me after a loved one or business partner’s death to ask the question, “What kind of insurance did they own?” Rather the question is, “Were the premiums paid up to date?”, or “How much is the death benefit?” Yes, there are several different types of polices and yes each type of policy can be vastly different than one another. Is a policy permanent? Will it cover a short term problem? Are premiums guaranteed? Is there a cash value? And, are there tax consequences? These are all fundamental differences. Never overlook the most basic premise. If you died tonight, will the death benefit in your policy do what you want it to do? A $100,000 d...