Whole life insurance is a form of life insurance that provides both life coverage and a savings component. Because of this, the premiums you pay are much higher compared to term life insurance. The savings portion is measured in “cash value” which builds over time as you pay your premiums. If you choose to forfeit your policy, then you are entitled to this cash value. You may also borrow against it in the form of a policy loan giving you access to the money without having to give up your coverage.
The premiums you pay are usually guaranteed to never increase, but for most plans you will be paying them for your entire life which is an important consideration to take into account when comparing different policies. It is important to note, that the savings return with a whole life insurance is usually not as competitive as with other savings vehicles.
It is for this reason that the alternative method of getting term life insurance and investing the difference is a wiser strategy. But, for those who use their whole life policy as being part of their estate planning due to the tax free benefit, it can be a smart choice. Ultimately the smartest decision begins with discussing your life insurance needs with a certified professional, and that’s where we come in.
If you have just began to look at buying life insurance, then you know that the Canadian market definitely offers you many choices. Many consumers are left feeling overwhelmed and unsure that the coverage they are looking at is their best option. Thankfully LifeCover.ca is here to help. Our approach is to look at your own individual insurance needs, prepare for you a comparison report and let you decide for yourself. See why everyday more Canadians are choosing us to help them ease the process of buying life insurance.