Life Insurance Solutions - Term, Whole Life & Universal

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We are a boutique financial planning and investment firm based in Oakville providing insurance solutions for families in Toronto and the GTA.

As an independent firm we work with over 15 of the top insurance companies in Canada to find you the best rates on term life insurance, whole life insurance and universal life insurance.

Contact us at (416) 274-1322 and keep scrolling to learn more.

The Basics

Life insurance provides a tax-free lump sum of money to the person or organization of your choice when you die. The most common purpose of life insurance is to ensure your family’s lifestyle is not altered if you unexpectedly pass away.

Term vs. Permanent Life Insurance

Term Life Insurance

Term life insurance provides protection over a fixed period of time. It is often used to cover an immediate need that will disappear at a fixed date, such as paying off a mortgage. The concept is the exact same as renting a home. You pay a fixed amount for a specific period, after the term is up you can choose to renew.

Term Life Insurance Needs:

  • Cover debts
  • Provide income to surviving spouse and children
  • Pay for children’s education
  • Cover funeral costs
  • Liquidity to fund a shareholder agreement

Permanent life insurance provides lifelong protection and is typically used for estate planning purposes. Permanent life insurance is like owning a home, it's an asset. As you pay down your mortgage you are building equity in your home. As you pay your insurance premium you are building equity (cash value) in your insurance policy.

Permanent Life Insurance Needs:

  • Liquidity to pay estate taxes
  • Continuation of a family business
  • Inheritance/estate equalization
  • Alternative to grow money
  • Charitable gift
  • Alternative to grow money on a tax-free/deferred basis outside of a TFSA & RRSP

Life Insurance Rates Calculator

Life Insurance Rates: Monthly

$250,000 10-year term life insurance, non-smoker*

Age Male Female
20 $ 16 $ 12
25 $ 16 $ 12
30 $ 16 $ 12
35 $ 16 $ 13
40 $ 20 $ 17
45 $ 27 $ 20
50 $ 41 $ 32
55 $ 68 $ 51
60 $ 117 $ 82
65 $ 200 $ 133
70 $ 356 $ 247

*Rates are subject to change, and may depend on individuals' risk factors

FAQ

Click each question below to display the answer.

Why would I need life insurance?

There are many reasons why you may need life insurance as described above. To sum it, if you have a family who is dependent on you from a financial or parental standpoint, you likely need life insurance.

If you co-own a business (or have a family business) life insurance is used to provide liquidity to fund your shareholders agreement. If you have an employee who is a crucial part of your company’s success, key man insurance may be needed so the business doesn't suffer financially if he/she dies.

If you own a family business but only one child wants to take over the business, insurance can provide liquidity to the other children to equalize your estate.

If you are a wealthy individual and foresee your estate incurring taxes upon yours and your spouses death, insurance is the best way to provide liquidity to your heirs so assets don’t have to be sold.

Why would I want term life insurance?

Term life insurance provides coverage over a fixed period. It is the most inexpensive way to provide liquidity to your family if you pass away unexpectedly. Term life insurance is used to fund a temporary need such as, debts, income replacement, children’s education, etc.

What are the types of term life insurance?

Depending on your need and your budget, there are several types of term insurance to choose from. There are: 10, 15, 20, 25 and 30-year term policies, term to 65 which lasts until age 65, and term to 100 which stays in force indefinitely until you die. A 10-year term policy stays in force for 10 years. It is the least expensive term policy you can purchase and is ideal for short term needs or if you are on a tight budget.

Can I convert a term life insurance policy?

A key advantage to a 10-year term policy is that you can convert it to a 20-year term policy before a specific time period. This is great if you have a longer term need but are on a tight budget today. The best part is that when you decide to convert it you will not have to go through another medical exam.

You can convert any term policy into permanent life insurance without having to go through a medical. This is ideal if you know you have a permanent need but do not have the budget to purchase it yet. The idea is to lock in your insurability with inexpensive term insurance so that when you decide to convert the term insurance to permanent insurance, you won’t have to go through a medical again.

Imagine if you decided to delay getting insurance because you wanted to wait until you could afford permanent but then became uninsurable… this happens far too often. Start with term, lock in your insurability, and revisit your situation each year with your advisor to see if converting to permanent makes sense.

Why would I want permanent life insurance?

Permanent life insurance is a wonderful financial tool for estate planning purposes. If you foresee your estate incurring a substantial amount of tax, life insurance is the best way to provide liquidity to ensure assets do not have to be sold to pay the tax.

Permanent life insurance is a terrific way to equalize your estate if you own a family business and one or more children want no involvement.

If you have extra cash sitting in your business that you do not need, purchasing a life insurance policy inside of your corporation is a way to flow the money out tax free to your heirs when you die. Another bonus is that you get to pay the premiums using your corporate dollars.

If you’re looking for a financial tool that will allow you to avoid / defer tax once you’ve contributed to your TFSA and RRSP, life insurance is the best option. Permanent life insurance policies can grow on a tax-deferred basis and pay out tax free to your beneficiaries.

What are the types of permanent life insurance?

Participating Whole life insurance is a permanent life insurance policy that stays in force until you pass away, so long as you pay your premiums. Once purchased, your premiums are guaranteed, meaning they will never increase. What makes whole life insurance unique is that part of your premium payment goes towards a saving component called ‘cash value’. The cash value grows on a tax-deferred basis and serves as a source of equity for the policy owner. To access the cash value, the policy owner requests as a withdrawal or a loan.

Participating whole life insurance policies are also eligible to receive policyholder dividends, which is often used to purchase more coverage, called paid up additions. The policy grows on a tax-deffered basis and pays out tax-free to your beneficiaries when you pass away. You can make additional deposits on top of your premium if you have extra cash that you would like to grow within the policy, eventually paying out tax-free to your beneficiaries.

Universal life insurance is a permanent insurance policy that also stays in force until you pass away, so long as you pay your premiums. In its most basic form, a universal life policies premium is guaranteed and the death benefit does not grow – essentially making it a permanent term policy. However, there is a guaranteed cash value that grows within your policy that you can access if you cancel your policy.

A universal life policy is another tax sheltering tool. What makes a universal life policy unique is that you can deposit money in addition to your premium that will grow tax-deferred and pay out tax-free to your beneficiaries. Additional deposits can be invested in a portfolio of mutual funds that grows your death benefit.

Because whole life insurance has a savings component that allows you to access cash value and grow your death benefit, it is far more expensive than universal life insurance. If you like the idea of having cash value that you can access in retirement, whole life insurance may be for you. If you simply know the amount of permanent insurance you want and cash value is not important, universal life is the way to go.

Do I have to pay my permanent life insurance premiums until I die?

Nope! You can set up your permanent policy in such a way to truncate the premium cost into a defined schedule, such as a 10 or 20 year period. It is more expensive upfront but can be advantageous as most people do not like added expenses in retirement when cash flow is limited.

Why would I need life insurance if I’m young, have no debt, have no kids and no spouse?

No debts, no spouse, no kids, no need for insurance, right? Although this is true for today, one day you may have a spouse, kids and debts. What if something happens to your health in the interim and you can’t get insurance when you actually need it? This happens far too often.

The purpose of purchasing insurance while you are young is to lock in your insurability. In the event that something happens to your health and you become uninsurable, you will already have coverage.

Start with an inexpensive term policy, if you become uninsurable you can either let the term policy automatically renew into another term policy or convert the policy into permanent insurance. No medical needed!

How much life insurance do I need?

For a term policy where your need is temporary, ask yourself:

  1. How much debt do I have?
  2. Do I want to fund my children’s education? How much will that cost?
  3. How much of my income will my family need to maintain a lifestyle they are use to living? How many years will they need this for?
  4. How much will my funeral cost?
  5. Add it all up!

For permanent need, a much more in-depth conversation has to be held with your financial planner, accountant and estate lawyer.

How much does this stuff cost?

For a healthy male, $1,000,000 of 10-year term life insurance costs approximately:

  • $460 / year at age 25
  • $470 / year at age 35
  • $970 / year at age 45
  • $2,800 / year at age 55
  • $8,400 / year at age 65
What is the application process?

The application process differs and is dependent on the age of the applicant and the amount of insurance being applied for.

Typically, once you go through a life insurance application with your insurance advisor, you will receive a call to set up a medical. A nurse will come to your home and complete a paramedical and take a blood and urine sample. However, this is not always the case as it depends on your age and the amount of insurance you are applying for. At times, if you are under a certain age and are applying for an amount under a certain limit, the insurance company will simply call you and ask around 20 minutes worth of health questions.

For large amounts of life insurance ($5,000,000+) underwriting requirements may also include: a medical by a physician, stress test EKG, company financial statements, motor vehicle report, an attending physician statement from your doctor, and a regular inspection report.

Once complete, the underwriter at the insurance company reviews the application, medical information, and other additional information to decide whether you are a good candidate for the insurance company to insure.

What is the difference between mortgage insurance and life insurance?

Mortgage insurance is an insurance policy designed to cover your mortgage debt if you die. Banks sell homeowners on this type of insurance when they get a new mortgage. The premium is added to your monthly mortgage payment, where you don’t notice it.

Mortgage insurance is a declining benefit, meaning the benefit shrinks as your mortgage gets less and less but the premium stays the same. Mortgage insurance is underwritten at death meaning there is higher likelihood the insurance will not pay out. You need to renew your mortgage insurance at the end of your mortgage term and the premium can increase. The bank is the owner and beneficiary of the policy.

With a life insurance policy you are the owner and your beneficiary, who you choose, gets to decide how he/she wants to use the insurance proceeds. Term life insurance coverage and premium stays constant throughout the existence of the policy. You are underwritten at the time you apply for the policy so there are no surprises when it’s time for the policy to pay out. Lastly, term life insurance is typically less expensive than mortgage insurance.

How can life insurance be used in my business?

Life insurance is commonly used between business owners who have a shareholder agreement. Say a company is split 50/50 between two owners, one owner dies, and his/her shares are now in the hands of his/her spouse. It is likely the widow(er) wants nothing to do with the business and it is even more likely that his/her business partner does not want to be in business with the surviving spouse. Insurance allows the business to buyback the shares from the surviving spouse providing the living business owner complete control and the widow(er) liquidity to live her life.

Further, see key man insurance.

What is key man insurance?
Key man insurance is life insurance on a key person to your business. This is someone who is crucial to the success of your business, whose absence could sink the business. The insurance proceeds are used to help the company survive the loss of someone who makes the business run.
Can I own a life insurance policy inside of my business?

Yes, a life insurance policy can be held inside of your corporation and the premiums can be paid using corporate dollars. Reasons to hold a policy inside of a corporation may include key man insurance and to provide liquidity when funding a shareholder agreement. When set up correctly, business owners can use corporate owned life insurance to flow corporate dollars out of their business tax-free. At death, the insurance proceeds flow into the corporation and can be taken out of the corporation tax-free.

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