Life insurance in BC (and the rest of Canada) is a massive industry fueled by ever evolving insurance products and methods of transferring risk. There are several important variables to consider before purchasing your life insurance policy, but first a little history on insurance.
Insurance dates back to early human societies such as the ancient Chinese, Greek and Roman Empires. An early version of life insurance might entail a mutual agreement entered into by every member of a settlement. If one family’s house is destroyed by fire, all other members of the settlement are committed to rebuild it. This idea evolved into more complicated insurance contracts when merchants paid to insure the cargo of their ships in case of bad weather, pirates, etc. The Greeks and Romans first introduced the concept of life insurance in 600 BC when they created “benevolent societies:” which cared for the families of deceased members.
Here are some key things you need to know before purchasing life insurance in BC:
- Review Your Insurance Needs - You need to decide how much of your family’s income that you provide. How many people depend on you financially and how much debt will you be leaving behind?
- Compare Different Kinds of Policies - There are two basic types of life insurance: term insurance and cash value insurance. Term insurance generally has lower premiums in the early years, but is valid only for a fixed period of time. Cash value insurance (such as whole life, universal life and variable life) can accumulate lump sums for you to use in the future, but is generally more expensive.
- Understand Renewal Policies - If you have a term insurance policy, you may be able to renew for one or two more terms even if your health has changed. However, the premiums may be higher and you may not be able to renew at all depending on the policy. It is important to understand your contract before signing it.
- Review Your Policy - Every few years you should be reviewing your insurance policy. How will inflation change your future insurance needs? Has your family size increased or perhaps your income has changed?
Reviewing and understanding your life insurance policy is critical for your current financial situation and your family’s, in the event you pass away. Life insurance in BC is complicated and difficult to navigate on your own. The life insurance agents at DENT Benefits will perform a complete financial analysis and custom build a policy to suit your exact needs. We recommend you contact the experts at DENT to review your current policy and ensure your family is protected against an unknown future.
The information in this material is derived from various sources. Material is provided for general information and is subject to change without notice. Every effort has been made to compile this material from reliable sources; however, no warranty can be made as to its accuracy or completeness. Before acting on any of the above, please contact us for benefit, pension and insurance advice based on your corporate or personal circumstances.