Questions or concerns surrounding life insurance? We tackle the most common concerns of our clients and clear up some of the confusion surrounding buying life insurance.
The choice to buy life insurance is usually quite personal, reflecting a need to ensure that friends, family, and associates do not suffer financial difficulty as a result of your untimely death. This can take shape in a number of different forms:
Ensuring that major debts, such as a mortgage, are paid and your home doesn’t need to be sold to cover it.
Providing a replacement income for the family so they can continue their quality of life.
Ensuring that children or other dependents have a paid-for education fund.
Protection for a business or key employees in a business.
Providing for final expenses (funeral costs, probate fees, estate taxes).
These are generally common needs among adult Canadians, making life insurance a critical part of building a sustainable and prosperous lifestyle.
Instant Life Insurance works closely with over 20 of Canada’s largest and most reputable insurance providers, a relationship that lets us work on your behalf to compare insurance plans from across the market. Once you’ve submitted your request for a quote, we get to work:
We take into account your financial and life situations to find the life insurance plan that will best serve your needs.
We compare rates from across the market, ensuring you will always have the lowest possible rate available to you.
We act impartially – we don’t favor any one insurer as that can compromise our ability to provide effective solutions to our clients.
Our network of experienced brokers works with clients to ensure their plan is closely matched with their financial limitations, health limitations, and overall concerns.
Once you have the insurance plan that’s right for you, your broker will work with you every step of the way to ensure your policy continues to serve your interests.
Getting started is as simple as filling out our provided quote form. The service is entirely free and with no-obligation to proceed or continue from step-to-step.
In the past, all life insurance plans required a full medical exam, either in a clinic or done with a nurse at home. For many, this process can be unnecessarily invasive or unwanted. For others, a medical exam could reveal underlying health issues that could risk the applicant paying significantly more for insurance – or face a declined application.
Today, most insurance providers offer life insurance with no medical exam. Typically, these policies simply asks a few “Yes or No” health questions, and qualification can be done at home with the help of a broker. This makes it easier to get insured if your family has a history of health issues, if you have health issues from being overweight, or for elderly applicants.
Do keep in mind that the amount of questions asked on a policy, as well as the nature of those questions, can vary wildly between different insurers. As such, it’s very important you work with a broker who works with multiple insurers rather than a sales agent that represents only one company.
How long you pay for your policy generally falls into two types of insurance: Term life insurance and Permanent life insurance.
Term Life Insurance – You choose the length of time the insurance is in force (typically 10, 20, or 30 years), with guaranteed premiums from the first day of the policy. Once the term is over, the policy ends and so do payments.
Permanent Life Insurance – Payments are fixed from the first day, and continue until the applicant’s death. As such, permanent life insurance is more affordable when bought sooner rather than later. Many policies have provisions to end payments at age 90 or 100, and some allow you to pay off the policy completely in as little as 10 years.
Without any further action on your part, a term life insurance policy that expires offers no continued coverage or refund. However if your term’s expiry is coming up, you have two options available to you:
Renew the Policy – You may renew your policy at the same or different term, with premiums being set from the date of renewal. Renewing a policy does not require a medical exam.
Convert the Policy – You may convert your term policy to a permanent policy, with rates set at the day you convert. For those who expect to renew policies consistently, this can be the cheaper option. Converting a policy does not require a medical exam.
Many employers offer life and health insurance benefits for their employees, particularly in many labour positions. And while this benefit can be extremely helpful in providing financial security, employee-benefits may not cover all the risk:
Disability and illness coverage plans may only pay benefits for incidents at or relating to the job – which can leave you out of work and with no benefits if you’re injured or ill for a non-work related reason.
Life insurance plans from employers typically only cover up to 2 years of wages, which doesn’t address any personal debt or the necessary welfare of your family.
If you lose your job for any reason, you lose benefits. If you own your own policy, it stays with you.
So if you do have a policy through your work, it may still be prudent to supplement that coverage with a plan that you personally own.
While a proper insurance policy will qualify that you’re eligible before you start payments, there are some circumstances in which a claim can be refused. Typically, claims can be refused when:
False or misrepresented information on the initial application
Death during a criminal act
Death during war
Additionally, some policies place a two year deferral period where no claim can be made on the first two years of the policy. Deferral policies, however, do offer a refund of premiums if death does occur in the first two years.
You may take out a life insurance policy out for another person, provided you meet both these requirements:
You have the insured’s express consent, and that they sign the application;
You need a vested insurable interest, ie: you have a financial liability or loss should this person die. Typically this means either a family member or business associate.
Being declined for coverage can limit your options in the insurance market, as a decline can be a reason to be declined in future applications. If you have been declined, you have two available options to get insured:
Opt for a deferral period – a two year period from the start of the application in which benefits are not paid. Many traditional life insurance policies offer this option, and is beneficial to those who can pass a medical exam.
You may cancel your policy within the first 30 days of application for a full refund of any premiums paid into the policy. After 30 days you may cancel your policy, but any premiums paid will not be reimbursed. Some policies offer a cash value which can pay out on cancellation, however there may be tax implications in doing so.
Some permanent life policies offer a cash surrender value, which can build over time as you pay into the policy. This amount is payable to you in the event you cancel your policy prematurely without making a claim.
Most policies have a 30-day grace period if you miss a payment, in which you may still keep the coverage in place. If you let this period lapse, you may have to undergo another medical exam to reinstate coverage. If your policy has a cash value component, you may also draw on that value to pay off premiums.