Why do I need Life Insurance?

Life insurance helps secure the financial future of your loved ones, covering expenses like debts, mortgages, or living costs in your absence. It can also be a powerful financial tool during your lifetime, offering options for cash withdrawals, retirement income, or tuition financing. The decision to buy life insurance depends on your responsibilities and financial goals.

 

How much life insurance do I need?

Your life insurance needs depend on your lifestyle, responsibilities, and financial stage. We’ll help assess your situation and recommend coverage that ensures your family’s financial security.

 

Can I use life insurance proceeds to pay estate taxes when passing on assets like a business or cottage?

Yes, life insurance is a key component of effective estate planning. It provides a tax-free* benefit to offset estate taxes when assets like a business, cottage, or income property are passed to heirs. This prevents the need to sell or borrow against the estate to cover taxes. (*Note: Probate fees may apply if a beneficiary isn’t designated, and the proceeds become part of your estate.)

 

When should I buy life insurance?

You should review your life insurance needs during key life events, including:

• Marriage or partnership.

• The birth of a child or new financial responsibilities.

• Buying a home.

• Starting a new job or business.

• Divorce, retirement, or other major life transitions.

 

Do I need to complete a medical questionnaire or take any other tests?

Yes, you’ll need to complete a medical questionnaire when applying for life insurance. Additional tests may be required based on your age or the amount of coverage requested. If needed, we’ll arrange for a nurse to visit your home or workplace for convenience.

 

What’s the difference between term and permanent life insurance?

• Term Life Insurance:

  • Covers a specific period, like 10, 20, or 30 years.

  • Lower cost, focusing on pure protection with no cash value.

  • Can often be converted to permanent coverage.

• Permanent Life Insurance:

  • Covers your entire lifetime.

  • Includes a savings component that accumulates cash value.

  • Designed for lifelong protection and estate planning.

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What happens if I miss a premium payment?

Missing a payment can affect your coverage. Many policies offer a grace period for late payments, after which your policy may lapse. Some permanent policies may use accumulated cash value to cover premiums temporarily, but this will reduce the policy’s value. Always reach out to your advisor if you're struggling to make payments.

 

Can I change my coverage if my needs evolve?

Yes, most life insurance policies allow you to adjust your coverage as your needs change. For example, you can:

• Increase or decrease the coverage amount (with underwriting for increases).

• Convert term insurance to permanent coverage.

• Add riders, like critical illness or disability insurance, for extra protection.

 

How does critical illness or disability insurance work with life insurance?

Critical illness insurance provides a lump sum if you’re diagnosed with a covered illness, while disability insurance replaces a portion of your income if you can’t work due to injury or illness. These policies complement life insurance by addressing different financial risks and providing more comprehensive protection.

 

Is life insurance a good investment?

Yes, life insurance can be a great investment—not just financially, but also in your family’s future and legacy. Certain policies, like universal or whole life insurance, include an investment or savings component that grows tax-free within the policy.

More importantly, life insurance is an investment in:

• Your family’s financial security: Ensures loved ones are protected if something happens to you.

• Legacy building: Provides a way to leave a meaningful inheritance for your family or favorite charities.

• Peace of mind: Protects your loved ones from financial stress during difficult times.

• Long-term wealth creation: Permanent policies can accumulate cash value, offering tax-advantaged savings you can use during your lifetime.

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How do independent advisors operate?

Independent insurance advisors are not tied to a single company, giving them the freedom to recommend policies from a variety of providers. They tailor solutions to meet your unique coverage needs at competitive prices, offering greater flexibility and choice.

 

Is my policy portable if I change jobs or move?

Yes, personal life insurance policies are portable and stay with you regardless of job changes or relocations. Group benefits from an employer, however, are typically tied to your employment and may not transfer if you leave the company.

 

Are there tax advantages to life insurance?

Yes, life insurance offers several tax benefits, including:

• Tax-free payouts to beneficiaries.

• Tax-deferred growth for cash value in permanent policies.

• Estate planning advantages to offset taxes on inherited assets.

 

Can I get life insurance if I have pre-existing conditions?

Yes, though approval depends on the condition and its severity. Some insurers may offer coverage at higher premiums or with specific exclusions. Certain policies, like simplified or guaranteed issue, don’t require medical underwriting and may be an option for those with health challenges.

 

What happens if I no longer need my policy?

You can:

• Surrender the policy: Receive the cash surrender value if it’s a permanent policy.

• Transfer ownership: Assign the policy to another person, such as a spouse or child.

• Donate it: Gift the policy to a charity for potential tax benefits.