Canadian Life Insurance

Do I need life insurance?
Why it's necessary for you and your spouse
How do I enrol?
Tips on obtaining life insurance

Do I need life insurance?

Life insurance is primarily intended for people who have others who depend on them, and protects those dependents from financial difficulties.

An important question to ask oneself is: do I have people who depend on me, and what would happen if I am gone? If you do not have a spouse, children, etc., or if you do not have a mortgage or any other debt then you may not need life insurance. However, this situation is rare, and most people need to know that if they pass away that their loved ones will be taken care of financially.

Why it's necessary for you and your spouse

Life insurance for your and/or your spouse is the foundation of your protection portfolio. However, while that principle will never change, maybe your needs have.

As you know, a regular review of your financial situation is an important step to ensuring you have enough coverage. Any number of life or professional changes can dramatically increase your financial responsibilities. Examples include getting married, having a baby, renewing a mortgage, starting a business, or securing a buy/sell arrangement, as well as other estate needs, like saving for education costs or providing a parent with support.

Stick to stand-alone coverage that is portable and goes where you go. As long as you pay your premiums, you can take this type of coverage with you wherever you work or business may take you, and stay protected anywhere in the world.

Be fearful of life insurance schemes often referred to as 'Creditor Group Life Insurance'. The sellers of group creditor insurance normally refer to such life insurance as "Mortgage Insurance", "Credit Card Balance Insurance", "Loan Balance Insurance", etc. (This should not be confused with standalone Mortgage Insurance, which we offer here.)

Tip: Don't do it!

The following hazards, risks and uncertainties are added when individual life insurance is purchased or replaced with group creditor insurance:

• Group creditor insurance coverage often decreases as you pay off the loan or mortgage but the premiums you have to pay often remain the same or may even increase over time.
• Normally you cannot continue with the same group insurance if you decide to re-finance the mortgage or the loan with another lender. If your health or other factors affecting insurability change, it may not be as easy to shop the market for the best loan rate and to keep the insurance.
• If your health or insurability deteriorates, you run the risk of your lender getting this information and this, in turn, may affect your ability to renew or continue with the loan itself.
• With group creditor insurance, the creditor is almost always the beneficiary. If the policy expires before you do...they profit. If you expire while the policy is still in force...they are usually the beneficiary.
• You will rarely, if ever, get a fair opportunity to fully examine the actual policy contract. (Normally all you receive is a single 'certificate' which is subject to the Master Policy which, of course, you don't normally get.)
• You have less regulatory protection since the regulators rarely, if ever, require that the creditor complete a comparison disclosure form when they replace individual insurance with their group creditor insurance.
• You have far less control and the group creditor life insurance may be canceled with little or no notice to you.

Enrolment

To enrol you need to submit an application, which can be done over the phone with one of our consultants in as little time as 5 minutes.

Once your application has been submitted you will hear back from the insurance carrier within 3 business days for a brief interview (most are over the phone, and concern any medical information, etc.).

Call us toll free at 1-866-580-8891 to enrol, or click here for a quote.

If you are purchasing term life insurance as a replacement for existing coverage (e.g. mortgage insurance) then we strongly recommend that you do not cancel the existing policy before the new policy is in effect.

Tips when obtaining life insurance:

• The healthier you are the lower the rates (i.e. premiums).
• It is better to buy sooner rather than later, when you are healthy.
• Periodically review your coverage.
• Do not rely only on life insurance from a group insurance policy.

For an excellent, unbiased discussion of tips, pitfalls and suggestions (in PDF format), click here.