Helping Investors find their way

TERM INSURANCE

Whether your goal is to maintain your current lifestyle, or to provide for your family in the event you cannot do so anymore, the following information provides an introduction to the many types of insurance policies available for your family’s protection.

TERM LIFE INSURANCE

So, you need insurance. But you only need insurance for a specific amount of time – say 20 or 30 years. Then you may want to consider a term insurance product. This type of insurance can provide low-cost protection on a temporary basis for a fixed amount of time, usually 10, 20 or 30 years.

How can you use term insurance?

Let’s say you want low-cost protection for the next 30 years, but you also have a mortgage with 10 years remaining. You can purchase a 30-year term policy and then add a 10-year term policy to it. This way you only pay for the additional coverage while you have the mortgage.

Is term insurance right for you?

While anyone can purchase term insurance, it is a particularly good choice if you are young and in good general health because you can benefit from affordable rates and guarantee your future insurability. As well, if your need for protection is only temporary, then you should consider a term policy.

How term insurance works

Term insurance offers affordable protection for a specific period of time – usually 10, 20 or 30 years depending on your need. You pay a set premium only for the number of years you require coverage and when the time is up, you can choose from several options.

What happens at the end of the “term”?

When the term of your policy is up, you can stop paying and cancel the coverage, convert your policy to a permanent form of insurance or allow your policy to automatically renew for another 10, 20 or 30-year term. Each of these options comes with specific requirements and we can help you decide which option is right for you.

What if a claim is made?

Should the unexpected happen and you pass away, a term insurance policy will provide a tax-free death benefit for your loved ones. The proceeds from the policy may be used to replace lost income, cover living expenses or pay off debts, such as your mortgage.

Term insurance vs. Mortgage insurance

Your home may be the single largest investment you will ever have. Protecting it through mortgage insurance or term insurance is something every homeowner should consider. Today, many people are opting for term insurance instead of mortgage insurance because it offers more flexibility, more guarantees and more protection – often for a better price.

Should I consider a 30-year term policy?

For many people the answer would be yes. Sometimes you may want insurance to cover a short-term need such as the time when your children are young and living at home with you, but for many people, their financial obligations will extend beyond 20 years. A term policy of 30 years may provide a very cost-efficient means for protecting your family for situations such as:

  • Longer term debt

  • Mortgages of 25+ years

  • Income protection to retirement

Plus, a 30-year term policy automatically renews at year 30 into permanent protection for life, with premiums payable to age 100.


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