Life Insurance
It’s not pleasant to think of a life being cut short but it can happen, and if it does, you want to see loved ones taken care of. Life insurance can provide a lump sum, tax-free benefit to your family should something happen to you or a family member. There are two main types of life insurance; permanent and term, which can be used on their own or in combination to meet your needs. With life insurance you can cover yourself, your spouse, your child, a business partner or anyone whose passing would negatively impact you financially.
We are independent insurance brokers and have contracts with most major insurance companies. This means we can help determine your insurance needs, find the best coverage for your personal situation and guide you through the application process.
Reasons to consider purchasing life insurance
- To cover liabilities such as a mortgage, loan or line of credit
- To provide replacement income for your family
- To cover final expenses such as funeral, legal and accounting costs
- To protect your beneficiaries from a large tax bill
- To ensure care for a dependent or future child education costs
Term Insurance
Term insurance is generally used to insure for needs that are a specific length, for example to cover a loan or mortgage. These policies guarantee the premium (ie monthly cost) for the length of the chosen term which is often 10, 20 or 30 years. Term policies can be renewed at the end of a term, however the cost generally increases significantly at renewal. Due to it’s shorter length, term insurance is less expensive than permanent coverage.
Permanent Insurance
Permanent insurance is generally insurance you purchase that will be in place for as long as you live. Permanent insurance is often used to cover funeral costs, taxes due at death and estate costs. The main types of permanent insurance are, term 100, universal life and whole life. Each type has different benefits and features.
Life Insurance vs Mortgage Insurance
Life Insurance and mortgage insurance are not the same thing. Mortgage insurance is provided by the lending institution that your mortgage is with and the lender owns the policy. Life insurance is with an insurance carrier and you own the policy.
A few reasons to consider life insurance over mortgage insurance:
Mortgage Insurance |
Life Insurance |
| Post-underwritten which means your health is investigated after your death and could result in the denial of your claim. |
Pre-underwritten so your health is investigated prior to issuing the policy.
|
| The proceeds upon death are used to pay off the mortgage and beneficiaries have no say on how the funds are used. | The proceeds are paid directly to beneficiaries and they can freely decide how to use the funds. |
| Only covers your outstanding mortgage balance, which means the coverage is decreasing as you pay off your mortgage. |
Generally has a set coverage amount.
|
| The lender owns the policy. | You own the policy. |
| Cost is higher per dollar of coverage. | Less expensive per dollar of coverage. |
