What should you look for when buying Life Insurance?
As I write this we are currently faced with a global pandemic, COIVID 19. This has caused a lot of concern and misconceptions around purchasing life insurance. So this article is to clear up any misconceptions.
How to purchase (since COVID-19 happened)
With COVID 19 most of us have been limited to staying in door, however this doesn’t hinder your chance at applying for life insurance. If you are currently looking for life insurance and not sure where to start I have good news. Insurance is easier to purchase today then ever before.
Insurance companies are offering easy non face-to-face applications. Depending on the coverage amount you are looking for most companies range from $25,000 to $1,000,000 of coverage without having to meet with an advisor. Some of these companies even offer Guaranteed issue policies with only a few medical questions you need to answer.
Is it too late? Life insurance in your 40s and beyond
Is it too late to get life insurance at this point? This depends on your insurance company and the policy you intend to purchase. Some insurers have policies with age limits that can range from 60 to 85. Working with a broker will give you access to any policy in Canada. This would include policies you can purchase past the age of 60. The pricing change depending on your age, but as long as your health doesn’t impede your ability to buy life insurance, it may still be available if you need it.
What type of life insurance do you need when you’re middle-aged?
At this stage of your life, if you’re not still carrying a mortgage or other debt you may be paying more attention to retirement or estate planning. So, you most likely need more financial stability and protection. Typically we recommend looking into permanent life insurance for the following reasons:
- Depending on your policy, your insurance costs may stay level.
- The plan might let you pay for a limited time and then never again. Similar to a mortgage eventually you pay it off and own the coverage forever.
- It gives your family or other beneficiaries a tax-free lump sum payment after you pass away.
- Some permanent policies generate dividends, which you can use to increase the death benefit or cover your premium payments.
But what if you’re thinking about purchasing term life or renewing your current term policy? (later in life)
Term life insurance is great when you’re just starting out because of the low cost, but it can become pricey as you move through different stages of your life. Every time you renew your term, the price goes up, because you are that much older. As you move into your 50s and 60s, those price increases a significant amount.
It’s not financially ideal to be paying more than necessary in your retirement years.
In short, it’s good to note that insurance companies are still looking for new clients. They are not only looking for clients but they are making it easier for people to purchase life insurance regardless of your age.
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