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Life Insurance

  • Are you raising a family?
  • Starting or growing a business?
  • Investing in a home?
  • Preparing for the future?
  • Looking for alternative investment options?

As we all know, the traditional purpose for life insurance has been to provide a financial cushion to those that depend on us in the event of our untimely death.  However, it’s the answers to the questions above that will help determine which type of policy is right for you.  

Here are some common life insurance applications that you may wish to consider:

Corporate Life Insurance

For business owners, life insurance can be structured to provide funding for a number of possible situations, including:

  • partnership buy-sell arrangements
  • business loan repayment
  • key person protection
  • business succession planning

Personal Life Insurance 

For individuals, life insurance is often purchased for one or more of the following reasons:

  • mortgage protection
  • providing for inheritance
  • income continuation
  • charitable giving
  • estate preservation (covering those pesky estate taxes) 

Two Types of Life insurance Policies

The two most common types of insurance are Permanent Life Insurance and Term Life Insurance. 

  1. Permanent Life insurance is meant to be just that, a lifelong plan providing necessary funds for estate preservation, inheritance, final expenses and tax planning. Whole Life and Universal Life are the two most common product solutions available in this category. Each provides a great deal of flexibility and can be structured to fit almost any situation.
    Most permanent life insurance policies also offer an investment component, whereby policy holders can choose to invest additional funds for a return.  This strategy is most commonly utilized by those who have disposable income or excess retained corporate earnings and are looking for ways to generate tax deferred growth on their investments.
  2. Term life insurance provides protection for a predetermined period of time, typically 10 or 20 years. This type of coverage is the most affordable and is often used for mortgage protection, income continuation and business planning.  Most term life insurance policies are both renewable and convertible.
    Renewable refers to a policy holder’s option to continue the policy beyond the initial coverage period of 10 or 20 years at a higher rate or premium. Depending on the plan you select, coverage can often be extended up to age 80 without providing additional evidence of good health.
    The Convertible feature on term insurance policies relates to the policy holder’s option to convert all or a portion of the benefit amount to a permanent plan at some point prior to policy expiry. Additional evidence of insurability is typically not required.

    Need help weighing the options?  Want to know what a policy might cost?  Drop us a line.