Life Insurance for Truck Drivers
This guide will explore the benefits of life insurance for truck drivers and provide you with all the necessary information to make an informed decision for your family.
7 Minute read
Originally published: July 31, 2024
Life Insurance for Truck Drivers
This guide will explore the benefits of life insurance for truck drivers and provide you with all the necessary information to make an informed decision for your family.
7 Minute read
Originally published: July 31, 2024
Truck driving demands long hours on the road, tight deadlines, heavy traffic navigation, and extended periods away from family. Although trucking can be a lucrative career, it’s also demanding and comes with significant risks, making life insurance a crucial consideration.
Securing a life insurance policy ensures that your family is financially protected in the event of an unexpected death. This guide will explore the benefits of life insurance for truck drivers and provide you with all the necessary information you need to make an informed decision.
In this article:
The Importance of Life Insurance for Truck Drivers
There are many reasons to get life insurance as a truck driver. Since many truck drivers are breadwinners, it’s important to consider the financial impact it would cause your family if you were to pass away. In addition to ensuring your family receives the income they depend on, life insurance can be used to cover end of life expenses, shared loans such as a mortgage or vehicle loan, cover planned expenses such as child care or higher education costs for a dependent, and to cover estate taxes when passing on property to someone after your death.
Income Replacement: Life insurance provides a lump sum payment to your beneficiaries after you pass. This amount can cover the income your family expected to receive and maintain their standard of living after you’re gone.
End-of-Life Expenses: Funeral costs can be expensive, so using a life insurance policy to cover these costs can be a great way to protect your family financially during an already difficult time.
Shared Loans: Many truck drivers have loans such as a mortgage or expensive vehicle loans that they may share with their spouse. Life insurance can be used to cover the remaining cost of these loans, so your partner isn’t left to pay them alone.
Planned Expenses: Life insurance can provide your family with enough money to cover planned expenses such as childcare and higher education costs for dependents, rent and daily living expenses, vehicle maintenance costs, medical expenses, and more.
Estate Taxes: Life insurance can cover the taxes on any property you leave behind, so your loved ones aren’t burdened with unexpected costs.
Life Insurance Options for Truck Drivers in Canada
There are three main types of life insurance in Canada, term life insurance, permanent life insurance, and no-medical life insurance.
- Term life insurance offers life insurance coverage for a specified term, typically ranging from 5-20 years. It is the most affordable type of life insurance and is a great option for truckers who expect their financial situation to change in the coming years.
Permanent life insurance offers permanent coverage (as the name suggests) and while it’s more expensive than term insurance it offers fixed premiums that never increase with age or the onset of a medical condition meaning it’s more economical in the long run. These policies also offer the choice to accumulate a cash value within the policy that can be invested and grown over time. It’s a great choice for older truckers who don’t want to pay increasing life insurance premiums and those interested in the investment component.
No medical life insurance is typically offered as a permanent policy, though it can also be offered as term insurance. While standard term and permanent policies require applicants to undergo a medical exam and submit their health history, no medical life insurance does not. This makes it ideal for truckers with serious health conditions, which may make it more difficult to qualify for standard policies.
Here is a quick overview of the three policy types:
Cost of Life Insurance for Truck Drivers
How much a life insurance policy will cost depends on a number of factors such as the type of policy you choose, the provider you go with, and your personal information. Term life insurance is the most affordable, whereas permanent insurance is typically much more expensive. No medical life insurance is usually the most expensive policy type due to increased risk to the insurer.
Here is a quick overview of the starting costs for each type of policy for a 50 year old driver in Canada looking for $500,000 in coverage:
Different personal factors can also affect cost. For example, since women live longer on average they typically pay lower premiums than men. Here is a look at different personal factors that can affect the cost of life insurance for truckers:
Age and Gender: As mentioned above, women pay lower premiums because they have longer life expectancies on average. Additionally, the younger you are, the lower your premiums will be.
Overall Health: Truckers often face health issues from long periods of sitting, such as obesity, heart disease, high cholesterol, and diabetes. These pre-existing conditions can increase life insurance premiums.
Dangerous Occupation: Since truck driving is sometimes considered a dangerous occupation, some insurers may charge truckers higher premiums than the standard rates.
Smoking and Alcohol Use: If you smoke or use alcohol heavily, your life insurance premiums are likely to increase due to the associated health risks.
Driving History / Criminal Record: Insurers may charge higher premiums and are more likely to deny applications for those with a criminal record or a history of risky driving.
Case Study Example: Life Insurance for a Trucker
Rick is a 50-year-old married man who works as a truck driver. He is interested in obtaining a term life insurance policy to cover several key expenses and provide financial security for his wife.
Rick’s Coverage Needs:
- Rick and his wife are currently paying off a vehicle loan for his semi-truck. The remaining balance on the loan, including interest, is $200,000. They expect to finish paying off the loan in 10 years.
- Rick earns $90,000 per year. He wants to ensure his wife has enough financial support to replace a year’s worth of his income in the event of his death.
- Rick anticipates that his funeral expenses will be around $10,000.
Total Coverage Needed: $300,000
Rick discusses his situation with a knowledgeable life insurance broker. Given his coverage needs, a 10 year term life insurance policy is ideal because it provides affordable coverage while he and his wife pay off their vehicle loan.
With the help of his life insurance broker, Rick secures an affordable term life insurance policy with $300,000 in coverage for the next 10 years. This policy ensures that in the event of his death, his wife will have the financial resources to cover funeral costs, pay off the vehicle loan, and replace his income for a year. After the term ends, Rick will have a chance to reevaluate his life insurance needs and apply for new coverage if necessary.
Frequently Asked Questions (FAQs) about Life Insurance for Truck Drivers
Insurance providers may consider truck driving a high-risk occupation due to the nature of the job. This can lead to higher premiums compared to other professions.
Maintaining a healthy lifestyle, managing any existing health conditions, improving your driving record, and choosing a policy with a shorter term can help reduce premiums.
A poor driving record, including traffic violations, DUI charges, and accidents, can result in higher premiums or the potential to be denied coverage. A clean driving record can help secure better rates.
Find the Right Solution for You and Your Family
If you are a truck driver interested in life insurance and have questions related to your specific situation, feel free to reach out to one of our expert financial advisors. At Protect Your Wealth we’ve been helping clients find affordable and comprehensive life insurance coverage since 2007. Contact us today or call us at 1-877-654-6119 and we can give you free customized advice and help you find a policy that’s right for you and your family.
We’re proudly based out of Hamilton, and service clients anywhere in Alberta, Ontario, Manitoba, and British Columbia, including areas such as Oakville, Abbotsford, Steinbach, and Grande Prairie.
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