Life insurance endowment, or an endowment policy, is a form of life insurance where if the insured individual lives to the expiry date of their term, they are able to redeem their policy for the face value. This means the premiums you will pay with this type of policy will be higher than you would for traditional life insurance, as you are guaranteed to receive cash back. The easiest way to think of it is a savings plan, with the added benefit of life insurance.
These types of plans are often used to save for things such as retirement, mortgage payments, or even a child’s education. If you are considering that this type of policy may serve as an effective way to save, it is important to speak with an experienced professional.
Life insurance endowments have lost their popularity as they no longer offer competitive interest rates compared to other savings mediums. For many policyholders, the biggest advantage of this type of insurance was that it functioned as a tax dodge, but because of modern tax law reform, these types of benefits no longer exist. For those with their heart set on getting a life insurance endowment in Canada, you may be out of luck. Very few insurance companies still offer these types of plans, due to lack of consumer interest.
The best advice is to speak with a certified life insurance broker, who can help you find a policy that can accomplish your financial goals. LifeCover.ca helps thousands of Canadians get the protection they need, at a price they deserve. We can make this easy, trust us, it’s what we do.