Life Insurance Brokerage
Trusted, Experienced Life Insurance Broker Serving Hamilton, Burlington, Oakville & the Surrounding Areas
Welcome to Protect Your Wealth – we a life insurance brokerage located in Hamilton, Ontario and have nearly 20 years of life insurance experience.
Life insurance protection comes in many forms, and not all policies are created equal. While the death benefit amounts may be the same, the costs, structure, durations, etc. vary tremendously across the types of policies.
At Protect Your Wealth, our life insurance brokers will work with you to create a protection plan for your family or business with a variety of personal life insurance options.
There are many reasons to have a life insurance policy. Some of the main reasons include:
- To pay final expenses
- To cover children’s expenses
- To replace a partner’s income
- To pay off debts
- To buy a business partner’s shares
- To protect a company against the loss of a key person
- To pay off estate taxes
- To utilize an alternate tax sheltered investment vehicle
- To guarantee future insurability
- To tax efficiently withdraw money from retained earnings of a corporation
Types of Life Insurance Policies in Canada
To break it down further there are essentially 2 different types of insurance; temporary and permanent. Under the “temporary” umbrella is “Term Insurance” and on the permanent side there is Term to 100, Universal Life and Whole Life insurance.
- Term Insurance is the most straightforward form of protection. You generally pay premiums on a monthly or annual basis and your family is protected for that “term.” Traditionally the “term” is for 10 or 20 years, after which time the premiums generally increase quite significantly. There is no savings component, and thus no cash value within a term policy. Term is generally the most cost effective form of life insurance.
- Mortgage Insurance offered through the banks is a form of “temporary” insurance, however with significant limitations. Amoung other drawbacks, the policy is post underwritten with a declining benefit and with the bank as the beneficiary. It is often not portable or convertible, offers no reduced premium for good health and usually sold by an employee of the bank with no life insurance background. Please read more on The Difference between Bank Mortgage Insurance vs Independent Life Insurance.
- Group Life Insurance is a type of life insurance in which a single contract covers an entire group of people. Typically, the policyowner is an employer or an entity such as a labor organization, and the policy covers the employees or members of the group. Group life insurance is often provided as part of a complete employee benefit package. Often group life insurance policies are not portable, hence if an employee retires or goes to another job the policy is no longer in force
- Term to 100 is a very misunderstood product. The name is partially a misnomer. “Term” normally implies that this is a term policy, but Term 100 means they are actually permanent policies because they have a term of 100 years and best of all, the premiums never increase.The policies are technically paid up at age 100, so the premiums cease at that point, but the coverage continues. Some Term 100 policies in Canada do offer a cash value, but most of them are offered on a stripped-down basis. This means that the owner does not get any return of premium if the policy is cancelled prior to death
- Universal Life Insurance is a type of permanent insurance which combines a life insurance and savings component into a single tax-advantaged plan. With Universal Life you have the ability to change your coverage, deposits and investment choices in response to your changing needs, conditions, or circumstances. Deposits are applied to the policy as they are paid each month or year. The insurance company deducts the insurance administrative costs from the deposits. The balance of the deposit is then applied to the saving account, which is made up of an investment mix which you may often select and manage. Universal Life policies offer a selection of investment options within the policy. As a result, these policies can develop significant cash values which the owner of the policy may use through surrender, policy loans or leveraging. The excess deposits and cash value accumulates in the policy on a tax-deferred basis.
- Whole Life Insurance insures an individual for their entire life and also offers a guaranteed cash surrender value including dividends in some cases (an amount that is paid out in cash should the individual decide to cancel their policy before expiration). Premiums, face value, and surrender values are all guaranteed under whole life. Your cash value and death benefit can never decrease in value unless you start withdrawing the cash value from the policy. Whole life policies often permit Limited Pay Options – ie You can choose the duration of your premiums (10, 15, 20, or 30 years, up to 65 or 100 years of age) based on your evolving priorities.
Given the vast number of options, it is best to sit down with one of our experienced life insurance advisors to better understand your situation before a recommendation can be made. We work in the life insurance industry each and every day.
Find out how Protect Your Wealth can protect you and your business with affordable and flexible life insurance coverage. Get your free, instant life insurance quote today!