28
Mar
2018

Life Insurance and the need for it

March 28th, 2018

Life Insurance can help fill in some potential financial gaps in your personal or business life

One of the main reasons people turn to life insurance is to provide financial security to their family in the event of an untimely death. Not only are there funeral and other associated expenses, there are other future costs like the loss of that person’s income earning potential over their expected life time.

Then there is the mortgage.

Which brings up a good point. You should always consider using a non-credit granting financial institution product for this for a variety of excellent reasons:

  1. 1) Life insurance payouts are non-taxable and can used for other non-mortgage uses. It is not payable to the financial institution.

  2. 2) As your mortgage amount decreases, your premiums stay the same for a diminishing amount of the mortgage insurance.

  3. 3) Your life insurance is not tied to your mortgage terms (see point #1)

  4. 4) You may get better underwriting with a market-based policy and possibly a cheaper rate.

  5. 5) Flexibility. You can choose the amount of insurance that is not associated with a mortgage.

Types of life insurance:

Generally speaking, there are two; whole life or permanent and term. The first type has a cash value at maturity while the term does not. It may even pay dividends. Term premiums are usually cheaper and run for a specified period of time and can usually be renewed but at progressively higher premium. They have no cash value.

Life insurance for business is a very important part of succession planning. Funds may be available for a share buyout of a partnership in the event of the death of another partner. Life insurance taken out on a key person is also a vital way of keeping a business profitable in the long run.

We have a dedicated life insurance who works in our office and is very familiar with all aspects of life insurance and has access to a variety of life insurance companies that can offer you the solution that you’re looking for. A convenient meeting can be arranged to match your timetable and location.