Should You Renew Your Term Insurance Policy?
Is your term insurance about to expire? Did you know that if you renewed it, your premiums are going to be 3-20 times more expensive?
What if I told you there was a better option than renewing it?
One that will let you maintain your coverage while keeping premiums affordable?
In this post, I’ll walk you through the options you have when your term insurance is about to renew and show you the one that will save you the most money.
Let’s get started.
How Much Does Life Insurance Cost? A Comprehensive Guide To Pricing
Did you know that the cost of life insurance in Canada can range from as little as $10 per month to over $300, depending on your age, health, and coverage type? Many Canadians are unaware of how affordable—or expensive—term life insurance can be, leaving them unprepared when it comes time to protect their loved ones.
Life insurance premiums aren’t one-size-fits-all. Factors like your age, gender, lifestyle, smoking habits, and even your hobbies can significantly influence your premiums. Understanding these nuances is crucial for making informed decisions and finding a policy that fits your needs and budget.
Whether you’re a young professional just starting out, a parent with growing responsibilities, or someone approaching retirement, there’s a life insurance plan tailored for you—and likely more affordable than you think.
In this guide, we’ll break down exactly how much life insurance costs in Canada, explore the factors that impact premiums, and show you how to find the best rates. By the end, you’ll be equipped with the knowledge to make a confident, informed choice. Let’s dive in!
Should you replace your life insurance policy?
Last week we looked at when you should perform a life insurance review. One of the suggestions that was brought up during a review was to replace your current policy if a new one would better serve your needs. How do you determine if a new policy is more suitable for you? In which way is it better? Worse? Is there a cash surrender value in the old policy that would trigger tax if you cancelled it? Would you qualify for a new policy for the same or better rate? These are all questions that you need to ask before replacing a life insurance policy.
How Much Life Insurance Do You Need? Calculate Your Ideal Coverage
Most people with a family dependent on their income know that life insurance is an important part of their overall financial plan, but few know how much coverage they actually need. Some life insurance agents swear by a formula, such as 8 times of salary, or a flat rate of half a million for everybody. But it’s most likely that these ‘methods’ of determining your life insurance needs are inaccurate. Instead, they are fabricated by the agent to simplify his life by not having to perform the calculations manually. So what is the right amount? Thanks to software provided by the life insurance companies, all it takes is a few minutes to determine the life insurance coverage that you need. They are typically all very similar, prompting you to input cash and income needs at death, and sources of cash at death. It then adds these amounts together to output your total coverage required.
LifePhases: an alternative to term and permanent life insurance
The main argument against term insurance is that premiums often increase dramatically at renewal, becoming up to five times as expensive at the first renewal and up to one hundred times the initial premium at the final renewal. The premium increases do not reflect the increase in an individual’s income. On the other hand, permanent insurance is likely to be too expensive initially, beyond the means of the average consumer. There appears to be room for an intermediate product that has neither the outrageous renewal increases of term nor the staggering initial costs of permanent insurance. PPI Solutions, along with Assumption Life, came up with a solution, called LifePhases and LifePhases Plus.
Term vs Permanent Life Insurance: Which Should You Choose? [Infographic]
Choosing the right life insurance policy is one of the most important financial decisions you’ll make, but it often comes with a tough question: Should you go for term or permanent life insurance? Both types have their unique features, benefits, and drawbacks, and understanding them is key to making the right choice for your needs.
In this post, we’ll demystify the differences between term life insurance—a cost-effective option for temporary coverage—and permanent life insurance, which provides lifelong protection and potential cash value. We’ll delve into the pros and cons of each type, helping you weigh affordability, flexibility, and long-term benefits.
By the end, we’ll settle the debate once and for all, helping you determine which type of life insurance is most suitable for you, based on your financial goals and personal circumstances. Let’s dive in and uncover which policy aligns best with your life plan.
Term life insurance and its 5 most common uses
Most people, when they think of life insurance, don’t picture a policy with cash values, investments, and so forth. They envision life insurance simply as straight forward as paying premiums in exchange for a death benefit when they die. This is exactly the principle of term life insurance. As part of a series of posts covering the basics of life insurance, in this week’s topic I will cover the 5 most common uses of term life insurance: final expenses, specific family need, income replacement, business applications, conversion to permanent.
5 important points to consider when purchasing life insurance
Five important points to keep in mind when thinking about purchasing life insurance. Know why you’re buying it, how much coverage is needed, whether to buy term or permanent, choosing additional options and affordability. There is no “perfect policy” that is suitable for everybody. The only perfect policy is one that is in force at the time of death of the life insured. Start by discussing with your family what your objective is for purchasing life insurance, and speak to a licensed insurance professional about your different options.
