Life Insurance
You may be asking yourself, “Why do I need life insurance?”
Life insurance isn’t the most pleasant thing to talk about. For many, it seems like an unnecessary expense. Here are just a few examples of when life insurance is essential:
- You have dependents (such as children) who rely on you or your spouse for financial support
- You are a business owner
- You have amassed a fair amount of wealth and want to be specific about how your estate is distributed
If any of these circumstances apply to you, it’s important to have life insurance. Even if you don’t have any dependents or a great deal of wealth, life insurance can help with expenses such as a funeral. A BrokerLink Insurance Advisor can help you determine the exact amount of coverage that makes sense for our situation.
Life can change in an instant. Taking time to plan is crucial if you want to have peace of mind that your loved ones will be taken care of. Taking the time to plan is one of the best steps you can take. Everyone has a story about a family member or friend who had a sudden and unexpected life change. It can really happen to anyone!
BrokerLink’s Insurance Advisors have helped numerous clients protect their families and their wealth through life insurance. Depending on your circumstances, the process may be quick and simple, or there might be a great deal to consider. Even if you have life insurance through your employer’s benefits plan, it may not be enough. It’s important to confirm there are no gaps in your current coverage.
That’s why the BrokerLink team is here to bring you peace of mind. We can offer expert, independent advice. You don’t have to go through this process alone. Our advisors are ready to help you get the coverage you need to keep your loved ones safe.
Types of life insurance
There are a few different types of life insurance you might want to consider:
Term Insurance
Valued for its flexibility and affordability, term life insurance guarantees consistently priced insurance premiums paid over a set period. This ensures reliable coverage that’s easy to budget for, rather than constantly shifting insurance costs to reflect your changing status or condition. The term options for this policy are long and comprehensive to ensure complete coverage during your peak years of risk and activity, but may also be renewed upon expiry.
Term life insurance pays out a tax-free benefit to your identified beneficiaries in the event that your death occurs while the policy is in effect. This amount depends on the limits specified in your policy and may be updated or customized to meet your changing needs.
Term Life Insurance Options
This affordable insurance plan is designed to protect Canadians at various stages of life. Options are available for between 10 – 40 years, with various limits for death benefits based on the financial needs of dependents whose future you need to secure. Monthly premiums are guaranteed to remain fixed throughout these terms and are based on an assessment of your current health, lifestyle, and risk factors that impact your quality of life.
Is Term Life Insurance Right For You?
This affordable but comprehensive financial protection plan offers generous benefits at fixed, low-cost premiums. This is best for Canadians who want the most cost-effective way to preserve the financial security of their family.
Term life insurance is also a great initial investment for young professionals just starting out in their careers, as this equips them with affordable protection. At the same time, they accumulate assets, as well as those who need to cover a mortgage or business loan. For business owners, a comprehensive term life insurance plan also allows them to fund buy/sell agreements and afford key person protection for shares.
Whole Life and Permanent Life Insurance
Whole life coverage offers you a guaranteed face amount, premiums and surrender values, and protects you for your entire life. No surprises, no worries! To adapt your coverage to your budget, you can choose to pay premiums over different periods.
Key Person Insurance For Business Owners
Key person insurance can help preserve the value of a business and its continuation in the event of the death of a key stakeholder in the company. Replacing the expertise and knowledge of an essential employee can take time and money and can jeopardize the continuity of the business.
The employer establishes a policy as the owner and beneficiary. The key employee would be the life insured but would receive no benefit from the existence of the policy. Death benefit proceeds would be received tax-free by the employer and would provide the liquidity needed to hire and train new skilled individuals and provide cash flow through a period of sales decline.
Buy/sell Insurance For Business Owners
Using insurance to fund a buy sell agreement is a smart business decision. Planning for the loss or disability of a business owner or partner with a buy sell agreement and insurance is crucial to ensuring the continuity of your business and protecting the financial interests of each co-owner’s family.
A buy sell agreement specifies what will happen to the interests of an owner, partner or shareholder who passes away or becomes disabled. If your company’s buy sell agreement requires that the other owners or partners must purchase the deceased/disabled owner’s interests, you can use life or disability insurance to fund the buy sell agreement rather than personal funds or business assets.
What are living benefits?
Living benefits provide coverage if something happens to you while you are still living. It serves a different but equally important need than life insurance.
Here are a few of the different types of living benefit coverage:
Critical Illness
A critical illness policy pays out a lump sum, tax-free benefit once you have survived a qualifying life-threatening medical condition. Some of the conditions covered under this policy include cancer, heart attack, stroke, or coronary bypass surgery. This lump sum benefit is designed to support you for lost wages or additional costs resulting from a change in your lifestyle brought on by the medical condition. However, the funds can be used at your discretion. To learn more about what conditions are covered, talk to your Insurance Advisor.
Disability
Are you covered for disability due to injury, illness or both? It’s important to understand the distinction. Too often, the cost of disability insurance is what deters people from paying for the right coverage. For instance, if you have an injury only disability policy and you find yourself off work for a long period of time due to an illness, your disability policy does not provide any benefit, despite the fact that you have been paying premium for years. Let us help you review your coverage and make sure you are protected.
FAQs
Why should I get life insurance on my own if I have coverage through my benefits at work?
While benefits through your employer can provide you with solid coverage, oftentimes it is not enough, and this becomes especially true if you have a young family. In addition, group life insurance policies often expire when you leave your place of employment.
Is all life insurance coverage the same?
No, there are several different types of life insurance designed to suit your particular needs. Term insurance is often ideal for shorter term coverage that requires a higher value, while permanent or whole life coverage guarantees coverage and premiums for your whole life. Also, there are hybrids of the two.
How do I know how much life insurance I need?
The amount of life insurance you require depends on many factors. Your broker is equipped with tools and training to help you accurately determine the level of coverage you should have.
