Tag Archives: Life Insurance Canada
“The greatest gift you can give your family and the world is a healthy you” – Joyce Meyer
Over a century’s worth of research underscores the link between life expectancy, physical health and strong, healthy family connections. The researchers behind a new meta-analysis conclude family support can increase survival by up to 50 percent. Moreover, exercising or losing excess weight turns out to be less important to physical health than interpersonal social networks.
The researchers analyzed results of studies going back to the early 1900s with a total of 308,849 participants. Strong family connections were found to help improve health and extend life expectancy by protecting individuals from stressful situations or establishing a standard of healthy living.
First of all, what is “Term Life Insurance” ?
Term Life Insurance is where you take out a policy to cover a death of the insured for a set period – the Term. These are typically used by people who may have a mortgage, or other large repayment commitment, and require coverage to make sure that during the period of the commitment the payments are covered in the case of death. Once the Term insurance is finished you do not get any funds in refund for not making a claim against the policy nor do you get a surrender value.
Once you stop paying the premiums of a term life insurance policy, or joint term policy,
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,
Life Insurance companies are in the business of making profits from the policies that they sell. This means that for each policy they issue they expect to receive more premiums, and the associated investment income from those premiums, than the amount they agree to pay out upon the event of your death. If they didn’t do this they would go out of business.
This means that they have to judge and assess your lifestyle with a view to evaluating how much risk there is of you dying an unnatural or early death. The greater risk of you dying an early death, then the higher the premium the insurance company is going to charge you.
This risk is based on a set of industry wide statistics used by most life insurance companies.
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,
For the most part it is a good idea for everyone to have some form of life insurance coverage. There are so many people that do not have the life insurance coverage that they need. Many of these individuals find out that the hard way that having coverage is important. It truly is the difference from being able to leave something behind to loved ones or leaving loved ones with a mountain of debt and worry. There are some people, such as pilots, that really feel they need to have the protection and security that life insurance offers. Life insurance for pilots is available. Those people that want this type of insurance must take the time to identify the companies that are willing to provide the service.
Life insurance can be divided into two types: term and permanent. Term insurance has no investment component and pays out a tax-free death benefit if you die during the life of the policy. Permanent insurance, generally universal life or whole-life is designed to last throughout your life time and often has an investment component allowing you to build up cash values inside the policy in a tax-sheltered manner.
The laws regarding the taxation of life insurance in Canada are anything but straight forward and can be a complex topic; the best possible advice will come from a tax professional that can assess your own individual circumstances. The subject of taxes and life insurance are basically broken down into two main areas;