Life Insurance
At Financial Value Inc. we look at life insurance differently than most firms.
Our focus is not on providing the lowest priced solution to every person who walks through our door, and in most cases find that Term Insurance is not a suitable solution for the majority of Canadians looking to protect their families from potential debts at the time of death.
In fact, almost all Canadians misunderstand what an insurance policy is: a tax shelter.
It is up to you, with the help of a licensed professional, to decide what kind of tax shelter you require, how large it should be, and what additional benefits can be provided in return for a regular premium deposit.
You are exchanging dollars for a tax free benefit you may never see or be able to use. This is the case in term insurance policies.
Term Insurance is just that: insurance for a predetermined term.
did you know that less than 1% of all term insurance policies actually pay a death benefit? (Penn State, 1993)
The majority of policies (~70%) are converted to Permanent Insurance policies or cancelled before renewal
Most of the rest are simply forgotten about and dissolve on their own
Term Insurance should not be mistaken for Life Insurance.
That being said, Term Insurance can play an important role in any individual, family or business financial plan, it is just unlikely that the need for insurance will dissipate over time.
Term Insurance starts very cheap, but very likely when you need it most, it will have been too expensive to hold onto.
All life insurance death benefits, be they Term or Permanent, are paid out tax free as long as there is a named beneficiary on the contract.
A comprehensive Permanent Life Insurance program is useful for so much more than a potential death benefit.
Most Permanent Life Insurance programs hide within them a powerful tax shelter that is useful to the insured and their family while they are alive.
The larger the benefit, the larger the potential for sheltering capital growth and accumulation from tax.
We firmly believe that the average person will live long enough to outlive their money, Life Insurance can assist in ensuring this is far less probable by helping build a large capital asset to use as equity; much like one would use the stored equity in their home or business, but in a much safer and liquid manner.
Life Insurance policies are the cornerstone of any financial plan, and built upon that foundation is the efficient capital accumulation and potential additional tax free death benefit of capital being accrued in a Permanent Life Insurance plan.
You may believe living to and past age 100 is a silly notion, we don’t.
A combination of tax efficient wealth accumulation (Life Insurance) and Wealth Protection tools (A&S) can certainly help safeguard the financial future of those of us who plan on living long healthy lives.
Check out our ‘Beyond 100’ initiative today and contact us to learn more!