Hobbies that may make your Life Insurer Squeamish

Things like smoking or having a high risk job will affect your life insurance policy – namely the premiums will be higher in relation to the risk you take. Most people, however, do not think of their hobbies when they take out a policy (or their policies when they take up a hobby). However some activities that you perform as a hobby in your spare time will make your insurance company very nervous. An obvious example;  having “skydiving” as a weekend hobby will affect your policy – It will cost you a lot more than someone who doesn’t go skydiving as you have a greater risk of being killed while enjoying this hobby.

Failure to inform your life insurance company of a potentially dangerous hobby could result in the company not paying out in the event of a death while partaking in that hobby, or as an effect of that hobby.

So what hobbies do life insurance companies consider high risk ?

  • Skydiving (as mentioned),
  • Bike, Boat, or motor vehicle racing,
  • Bungee Jumping (as a continuous hobby – not just a one off),
  • Hang Gliding, hot air ballooning, or any form of flying,
  • Parachuting,
  • Rock, or other forms of climbing (buildings, bridges, etc etc),
  • Scuba diving, or any form of deep diving,
  • Surfing, both normal and wind surfing,
  • Skiing, or snowboarding racing.

There are other hobbies not listed above, so you are advised to consult your insurance company when applying for life insurance if you have a hobby that is considered unusual, or involves anything that may be fatal.

Most people tend to tend to forget these activities when applying for a life insurance (Failure to do so could invalidate your policy, resulting in no payment in the event of a serious accident causing death), particularly in the case of hazardous activities. If you were a regular parachutist when you took your policy out at the age of 25, but stopped doing the activity a few years later, you should contact your insurance company and have the details of your policy reviewed (with parachuting being removed) – You may find your premiums drop considerably.

If your insurance company are uncomfortable with your hobby (either at the start of the policy) you can usually find specialist insurers who offer coverage for your hobby. Check with other people who do the same hobby, or with the club you attend to find the name of a suitable insurer. Obviously the premiums for these policies will be higher than regular policies.

The bottom line is, if you do anything that may put your life in danger, either at home or at your job, you should consult your broker to make sure you have sufficient coverage from your life insurance policy.

Should I invite an life insurance agent into my home, or use an internet life insurance broker?

Life insurance is a difficult subject, it is a decision we all have to make, and a thing we all should have. Whether it be a simple policy that will pay out when we die so that our families are not overly burdened by our passing, or an investment for our retirement. The industry is full of difficult language, clauses, contracts, exceptions and fees. It is a minefield waiting to catch the unwary, and one that some people dread to walk upon.

That’s why we have insurance broker, and life insurance agencies. They are there to make the minefield seems a little less perilous, safer to walk through. They are there to make sure that you connect with the policy that suits you best, not one that suits the pockets of the insurance company better. They act as intermediaries between you and the complex facts, forms and figures required by insurance companies before they will agree to cover you.

In the old days it was common to get yourself an insurance agent, and they would come around to your house, partake in a coffee and some biscuits while they laid out their plans and proposals on your dining table. The whole night would be spent going through the facts, and figures, dealing with difficulties and coming up with a plan that you could both afford, and would cover you sufficiently in the event of your death.

More than likely, your insurance agent was a local person. Someone you would see in the local supermarket, who happened to be in the business and only covered the immediate area of their residence, more of a friend or acquaintance than someone trying to sell you something.

Times moved on, and we moved into the internet age.

Today you can have a similar discussion with a life insurance broker on the internet. They will discuss the same things, offer the same facts and figures (probably more now as they have so much more to offer at their fingertips than your neighbourhood agent had in their briefcase) and propose similar services. The only difference is they are not sitting in your home.

Or is that the only difference?

Consider the old scenario again. You would phone up your agent, arrange a time for them to come round and then spend the evening going over things. It wasn’t exactly dynamic was it? You had to dedicate an evening to the process, the only facts you were presented with were the ones they brought with them, and you sort of felt under a little pressure to sign something before the evening was out in case you were guilty of wasting their time. (If you didn’t sign the contract you would have to avoid them if you saw them in the street in the ensuing weeks).

Today’s world doesn’t work like that anymore. In today’s world we expect someone who is providing us with a service to have the world of technology at their fingertips, to be able to offer us any answer to any question. We expect them to be there when we decide, not at a mutually acceptable time; be it 3:30 in the afternoon, or at 8pm when we get home from work. We have the ability to double check any fact or figure they may quote us, instantly using the same internet technologies that they are using. And, a big and, we have the choice to say yes, or to say no, to move on and find someone else to help us – no hard feelings.

In short, in today’s world, we want answers to be fast, efficient and accurate. Forget the social chit-chat, we are discussing business, and when we are finished we want to continue with our normal lives satisfied with a job well done – mission accomplished.

An online broker offers all of that. They are sitting in their office when you speak to them (it can be a chat session, Skype phone call, or just exchanges of emails) so they have all of the facts and figures of their whole company at their fingertips (no more – “let me check with head office” – they are in the office). They are at work, and have lives of their own, so it is not in their interest to try and spend hours talking to you. They will professionally convey the facts and figures, discuss your concerns and worries, make suggestions about policies and terms and let you make the decision. There is no pressure to sign the deal before they leave, they can pick up the conversation tomorrow or the next day.

If you need time to look at the policy, simple, they email it to you and you take your time to read it, no one looking over your shoulder. You can still question any part of it as you would to an agent sitting next to you, or you can end the conversation there and say you will contact them again when you have looked through the documents.

Of course an Internet broker does lack some of the personal touch that a visiting agent used to have. But ask yourself a question; when was the last time you asked the man from the electricity company to come round for dinner when you were deciding which energy plan to use in your house? You didn’t did you? It was a service you needed, you handled it like any other service you need in today’s world, online or via the phone.

 

Choosing Life Insurance Beneficiaries

Nobody likes to think of dying, but as it is a fact of life it must be given consideration at some stage in your life. Normally people will start to think about things like life Insurance when they start families, relationships, or enter into agreements where security in the event of their death is required.

When looking into life insurance and signing up for a policy certain things must be taken into account.

Who are the beneficiaries going to be is an important one. Does any money paid out go automatically to your spouse, children or bank? If you are in a stable relationship, but not officially married, does your partner automatically receive payment or do you have to specify this.

(We have all seen news reports where people have died and their families have hit the headlines while battling amongst themselves for what monies the deceased had, or was entitled to from their insurance policy).

When you take out a life insurance policy of whatever form, there is a space on the policy document where you can name your chosen beneficiaries. If you fill this out any monies due at the time of your death will go directly to them, usually without question and within 30 days.

If you do not fill out this section of the document, any monies due at the time of your death will go to your estate (the collection of assets you owned at the time of death). This estate is handled “in probate” by a lawyer who decides depending on circumstance how the money is distributed.

Normally, the lawyer handling your estate has to respect the contents of a will and distribute the estate as the deceased required. This process can, however, be contested in court by relatives of the deceased for a multitude of reasons.

If you have completed the beneficiary part of your insurance document, it is your responsibility to make sure that it is up to date, changing it as your circumstances change. (For example; when you first got married you took out a life insurance policy and named your, then, spouse as the sole beneficiary. Later on in life you divorced and re-married. In the event of your death any monies due from the insurance policy will automatically go to your first spouse – unless you changed the beneficiary listed in the policy and named your current spouse.)

(Changing the beneficiary listed on your insurance policy is fairly simple, most insurance companies will just require that you fill out the appropriate forms and will then update your existing policy. Whereas changing a will usually requires the actions of an attorney and that the will is signed in the presence of witnesses)

When naming beneficiaries on a policy you have a number of choices:

  • You can name a sole beneficiary: In the event of your death the policy is paid directly to them.
  • You can name primary and secondary beneficiaries: in the event that the first beneficiary dies before you do the proceeds of the policy will go to the secondary beneficiary listed.
  • You can name a list of beneficiaries and specify what percentage each will receive at the time of your death. In the event of the death of one or more of the beneficiaries the figures will be adjusted to accommodate those remaining.

Can you name any one as a beneficiary?

Yes, you can name any one you wish as a beneficiary. They do not have to be a member of your family, or even connected to you in any way. In cases where a policy holder has no direct descendants it has been known for them to name someone unrelated to them who may have cared for them, or even charitable organisations.

It is, however, important to inform the beneficiary that you have named them as such, because if the life insurance company cannot locate the listed beneficiary after a certain period the proceeds of your policy will revert to your estate. (Which, in the case of no descendants, may revert to the province)?

So, when you take out that insurance policy think about whether you wish to name a beneficiary, or let the proceeds go to your estate, which will respect the contents of your will.

Life Insurance Brokers in Canada

Family signing life insurance policy

Our life insurance brokers are committed to getting you the best possible coverage at the best price!

An insurance broker is a professional who specializes in selling life insurance from various insurance companies. The main difference between a broker and a captive agent is that the agent sells insurance from a single company, while a broker represents multiple companies giving them more options to find you the most suitable coverage.

Licensing in Canada

In Canada each province is responsible for the licensing requirements for brokers. The life insurance industry is active and ever changing, and can be complicated; a professional broker is a necessary resource when you are shopping for life insurance. Brokers are tasked with keeping knowledgeable about the latest policy offerings and industry trends, and applying that knowledge to help you.

Why a Broker?

If you are in the market to purchase life insurance, it can be very beneficial to work with an independent insurance broker for a few reasons. A captive life insurance agent has a direct relationship with the insurance carrier, which means their interest is with the provider, not the life insurance consumer. A life insurance broker has contracts with numerous insurance companies they represent meaning that their interest is more directed at getting the client the best possible contract.

We Make it Easy

As consumers become more reliant on using the internet to educate themselves on life insurance, life insurance brokers are forced to adapt. As a company that prides itself in connecting Canadians with the best advice through our brokers in Canada. Solutions Financial works hard at ensuring our brokers are committed to getting you the best possible coverage at the best price.

Get a life insurance quote now!