When it comes to most forms of insurance, many people understand the importance of having coverage. Whether it’s your car, your home, or other valuable possessions, having insurance means that you’re financially protected should disaster strike. One of the first things you do when you buy a new car is to make sure it is protected before you drive it off the lot. Why? Because if you are involved in an accident chances are good you would suffer financially.
If you have a mortgage, it makes good sense to insure it. Owning a debt-free home is an objective of any sound financial plan. In addition, making sure your mortgage is paid off in the event of your death will benefit your family greatly.
The question is, should you purchase this coverage through your lending institution or from a life insurance company? A good rule of thumb to follow when searching for advice? Ask an expert!
So, while it might be convenient when completing the paper work for your new mortgage to just sign one more form, be aware that it might be a costly decision.
The recent developments in investment markets and the volatile performance that has resulted have brought about a new appeal to an old workhorse. For investors looking for a diversification in their investment portfolio and a more tax-efficient fixed income investment alternative, a compelling argument can be made for the use of Whole Life Insurance.
In the planning of their estates, most parents might prefer to leave their assets in equal shares to their children. Often, the only complication in this scenario could be how to divide up the family home.
For owners of a family business, however, the concept of treating the children equally can often be much more problematic. This can especially be the case where one or more children are active in the business while others are not.
Given the problems encountered by some large financial institutions in the United States, how concerned should we be about the state of the life insurance industry in Canada?
If you require permanent life insurance coverage for family, estate planning, business, or tax planning purposes or you just wish to accumulate money in your life insurance program it may be time to look at a permanent, level-cost solution.
During this stressful and challenging time, many are wondering what effect COVID-19 could have on their life insurance. Some may be worried that the insurance companies would make changes to their existing policy due to coronavirus concerns, resulting in an increase in their premiums or a restriction to their coverage. It should be reassuring to all that insurance companies are generally not able to change the contractual provisions of the insurance policies that are in force.
It has long been an accepted strategy to provide sufficient estate liquidity to pay taxes due at death from the proceeds of a life insurance policy. In Canada we are fortunate to have permanent life insurance policies that insure an individual for their entire life with a premium that is guaranteed not to increase. It is feasible to be able to use these policies in an effective estate plan.
Naming a beneficiary of a life insurance policy provides a significant benefit in planning and protecting one’s estate. With a named beneficiary, the death benefit is paid directly to the beneficiary and is received tax-free. It bypasses the policyowner’s estate and is not subject to probate or any other administrative fees.
If your goal is to replace income for your family for more than 2 years, you may want to add an individual policy to your group insurance coverage.
According to the same LIMRA study, on average, households with only group coverage can replace the household’s income for less than 2 years. Households with both group and personal life coverage can replace income for more than 5 years.
