Whole Life Insurance is a Good Investment Product for Savers

With so many different types of insurance out there, it can often be difficult to determine which policy best suits your needs.  Depending on your current financial situation, as well as your future financial goals, different plans meet different needs. If you are starting out with a young family, term life insurance may suit your financial situation and goals.  If you are in a stable financial position and you are interested in combining life insurance and investments, then you need to know that whole life insurance is a good investment product for savers! 

What is whole life insurance? Whole life insurance is an insurance policy that protects you for your entire life. Unlike term life insurance, which covers for a specific range of time, 10 or 20 years for example, a whole life insurance policy covers you for life. This means that you are protected for your entire life, without having to worry about renegotiating after your term life insurance policy has expired. 

Even better, whole life insurance is not just important as a life insurance plan – it is also a great way to invest and save money for your future!  Whole life insurance is a good investment product for savers because it carries a cash value, is a safe investment vehicle, and because it carries important tax benefits! 

Carries a Value and Can Be Borrowed Against: A whole life insurance policy carries a cash value, and you can use this cash to borrow against. The cash value of your insurance policy can be taken out and used as a loan for other expenses. Also convenient is the fact that you can pay it back in a number of different ways, for example, making regular payments or letting the interest accumulate and having the amount owing subtracted from the benefit paid out in the end, whichever option works for you. 

Safe Investment: As an investment, a whole life insurance policy is also an effective vehicle by which to accumulate wealth and generate value for your future financial needs. Whole life insurance policies are designed to be low maintenance. The accumulated cash value is invested in a diversified investment pool which is managed by professionals, meaning little to no involvement is required by you. Safe and secure, whole life insurance policies are designed to meet your investment AND insurance needs. 

Tax Deduction: If you choose not to withdraw the cash that accumulates, the value of the investment will grow tax free. If you wait and only draw the cash once you retire, you will most likely be in a lower tax bracket than before you retired, and thus will have the chance to keep more of your money!  

These three major reasons why whole life insurance is a good investment product for savers should help you to determine, firstly, what it is you want to gain from your insurance policy, and secondly, how your insurance policy can work for you.  

For more information about how whole life term insurance is a good investment product, or to discuss what insurance policy will suit your current needs, please contact Gary Mandel at Independent Financial Concepts Group at 416-849-1653 or visit www.wecoveryou.ca.

What Would Make You Leave Your MGA or Insurance Company?

If you work in the insurance industry then you know how competitive it is and that it takes drive and ambition to be successful. Insurance advisors in Ontario will generally work with an MGA or an insurance company. We speak with insurance advisors all the time who are unhappy with the MGA or insurance company that they work with, and often for different reasons. 

Generally speaking, many insurance advisors who work with insurance companies sometimes find it challenging to stay competitive because they can only recommend insurance products offered by that insurance company. If the insurance company’s rates and products are not competitive, they will be less successful. If the insurance company doesn’t invest in marketing their brand it impacts their success, and if the insurance company is behind with technology and innovation, this too will make being competitive and successful a challenge. 

The sky should be the limit for insurance advisors who work with MGA’s because advisors who work with MGA’s have access to most insurance products available on the market. However, insurance advisors who work with MGA’s often run into other challenges that surround a lack of support.

A good MGA will invest in their team. They will ensure that they are up to date with the latest technology, provide sales and product-related training to their insurance advisors, help their advisors to get their deals processed and make themselves available to answer questions and provide support as needed. Unfortunately, this is often not the case. We have had many advisors who have joined our team because of issues such as not having their calls returned. While an MGA may be busy and put off returning a call as less of a priority, receiving that call from the MGA could be a top priority for an advisor because they could have a deal riding on a question they are waiting for an answer to.

What’s interesting is that in the past few years, employee recognition seems to be one of the biggest driving factors that results in many advisors choosing to leave their MGA or insurance company. Employee recognition is really important and insurance advisors need to be credited for a job well done. This could be something as simple as taking an advisor to lunch. Strangely enough, we have heard of instances where top performing advisors have been invited to dinner and then sent an invoice from their MGA.

All in all, recognition, support and compensation seem to be the leading drivers that impact whether or not an insurance advisor is happy with their MGA or insurance company. The biggest challenge for insurance advisors who become unhappy in their support arrangement is how involved and complicated it is to switch insurance companies or MGA’s. This is often one reason that insurance advisors will continue to work with a company who is not providing them with the recognition, support and compensation that they deserve.

The best advice that we provide to advisors who have had enough and want to switch insurance companies or MGA’s is to make a list of what is important to them. Research and meet with different companies, and when you find one that offers you what you need, take the leap. Many times taking the leap will result in increased job satisfaction, competitiveness and success.

If you are unhappy with the support provided by your insurance company or MGA please contact Gary Mandel at 416-849-2939 at Independent Financial Concepts Group or visit www.joinifcg.com for information about the benefits that come with joining our team.

Term Life Insurance is a Good Choice for Young Families

Starting out with a new family is an exciting time, but it is also a time when many different financial decisions need to be made. Securing life insurance for your young family is very important. 

Life insurance at any stage of the life cycle is important, but how do you know which type of policy to purchase that will best meet your needs? Depending on your own unique situation, this will vary. However, if you have a young family, term life insurance can be best choice.  

Firstly, what is term life insurance? Term life insurance is a life insurance policy that is set for a specific range of time, be that 5 years, 10 years, or up to 30 years. This means that the policy and premiums are set for the term that you choose, and the insurance covers that time frame. For example, if you are just starting out with a new family, and know that your situation is not likely to change in the near future, a longer policy, 20 years for example, would work best.

Term life insurance is a good choice for young families for 2 major reasons. The first reason that choosing a term life insurance policy is a good choice is that it gives you the flexibility to decide what year term will fit you current and future needs.

Because term life insurance policies can be purchased for terms starting from just 5 years, and ranging upwards, you are not locked in for an unending, permanent period of time. This is useful and convenient, as once children leave home or become financially independent, financial responsibilities often lessen, and you can easily choose a new insurance policy to fit your changing needs.

The second reason that term life insurance is a good choice for young families is that it is affordable. Young families often have many different monthly expenses, which can range from mortgage payments to child care costs, and so affordability is crucial. By choosing a term life insurance policy, you can determine what plan best suits your current financial situation. Moreover, because it is a term life insurance policy, you know that when your financial situation has changed (kids moved out, going to college, job advancement, etc.), you will be able to change the policy so that it fits those changing needs.

By choosing a term life insurance policy, you can guarantee that your family is protected in the case of your untimely death, while also ensuring that your policy is financially manageable. Fixed monthly payments, set at the beginning of the policy, do not change over the course of the chosen term. This means that a term life insurance policy financially safeguards your family while remaining within your means.

Life insurance is essential for new families, and term life insurance is the best choice. Because of its flexibility and affordability, it offers both financial security and peace of mind, and allows you to relax knowing that your family’s future is protected.

For more information about how term life insurance is a good choice for young families, or to discuss other policy options, please contact Gary Mandel at Independent Financial Concepts Group at 416-849-1653 or visit www.wecoveryou.ca.

The Moments When You Could Really Use Support from Your MGA

If you are an insurance advisor then you likely work with either an MGA or an insurance company directly. Insurance advisors who work with MGA’s have increased benefits over insurance advisors who work for insurance companies because they are able to offer a more competitive range of insurance products. Instead of only being able to arrange insurance through a single insurer, they are able to offer insurance products from many different insurance companies. Working for a good MGA can be enriching, but like any business, some MGA’s are better than others. 

As an insurance advisor, the level of service you provide your clients will largely depend on the support provided by your MGA as well as the support provided by the insurance companies who you broker insurance policies for. Sometimes it is the insurance companies who present the biggest challenge to the success of insurance advisors.  

Of course you would think that insurance companies would be highly motivated to act quickly to lock in an application that they receive from an insurance advisor, but often their own internal bureaucracy and disorganization can cause an insurance advisor to lose a deal.

Some examples of ways that insurance companies have been known to let down insurance advisors include:

1.       Not living up to time lines. Selling an individual on an insurance product can be hard enough, but when an insurance company takes too long to approve an application it can create an opportunity for the customer to shop around, or they may forget their reason for purchasing the insurance in the first place, resulting in lost deals.

2.       Lost information. There are instances from time to time where insurance companies actually lose information. This can be frustrating and can mean extra work for you.

3.       Requesting more piecemeal information. This is a huge challenge because when insurance companies do this, it gives a customer the impression that you don’t know what you're doing. Ideally, an insurance company should provide you with all of the questions they would like you to ask your client at once- but this often is not the case.

4.       Sales that result in substandard service. When insurance companies promote sales it can cause them to get really busy, really fast. This can impact customer service and service delivery which will ultimately impact the level of service that you provide to your clients.

The insurance business is a service business. The level of service that you provide to your clients will directly impact your ability to be successful in this business. When insurance companies give you grief and you work with an MGA, this is one of those moments when you will need to be able to count on your MGA to step up to the plate and support you.

Some MGA’s are not prepared to intervene and stand up for their advisors when an insurance company is providing substandard service. This is because they are often more concerned with “not bothering” the insurance company than with seeing their advisor be successful. Or they may fear losing their good standing relationship with the insurers.

If you work for an MGA who doesn’t stand up for you with insurance companies who are making it difficult for you to process your deals then it may be time to look at switching to an MGA who will. While it can be an involved process to do so, it will be worth it in the long run because it will likely lead to increase job satisfaction and profitability.

If you are unhappy with the support provided by your MGA please contact Gary Mandel at 416-849-2939 at Independent Financial Concepts Group or visit www.joinifcg.com for information about the benefits that come with joining IFCG. “In business for yourself, but not by yourself.”

Income For Life – What is Guaranteed Income on Retirement?

Are you looking forward to retiring and finally putting all of those exciting retirement plans into action, but are concerned about your ability to maintain your lifestyle without using up all of your savings?  Afraid that all of that money you have saved up will not last? Guaranteed income on retirement will relieve these concerns – but what is it and how can you get it?

What is it? Essentially it is income for life. Guaranteed income on retirement is a regular income payout you start to receive after you retire. This allows you to meet your financial needs after retirement, without worrying about where your monthly income will be coming from.

How can you get it? An annuity is often the most efficient option when looking at setting yourself up with a guaranteed income on requirement. An annuity gives you a guaranteed income for a pre-set period of time or for life. In exchange for a single lump sum investment, you make regular income payments that contain both interest and a return of principal.

There are several different types of annuities to choose from in order to set yourself up for guaranteed income on retirement. Term annuities can provide you with guaranteed, regular income for a pre-set period of time. Once the time period is over, the payments stop.

Prescribed annuities are another option for guaranteed income on retirement. These offer privileged tax treatment if you are investing using non-registered funds. Each payment you make includes the same amount of interest and capital, thus evening out the amount that is subject to tax, and providing you with some tax deferral.

A third option for guaranteed income on retirement is a life annuity. A life annuity pays a regular, guaranteed amount of money of a monthly basis, for the rest of your life. They can be purchased as a single life, based on a single person, or as a joint and survivor.

A life annuity is often the best option for guaranteed income on retirement, or income for life. This is because it deals with 2 major retirement risks: the chance that the stock market may crash before you are set to retire, and that your savings will run out.  Statistics Canada has reported that the average man who has reached age 65 could expect to live an additional 18.1 years and a 65-year-old woman could expect to live an additional 21.3 years. These are significant periods of time, but because your income is set, you can always count on the monthly income that comes for the rest of your life.

Guaranteed income on retirement gives you the peace of mind to enjoy retirement without the financial stress that can accompany it. As with any retirement planning, it is better to start early. Instead of waiting until you are getting ready to retire, take the time now to look into your options, specifically those that will provide you with an income for life.

To discuss your options and find out what best meets your needs for retirement and how to ensure that you have income for life, please contact Gary Mandel at Independent Financial Concepts Group by calling 416-849-1653 or visit www.wecoveryou.ca

Critical Illness Insurance - Is it worth it?

In recent years, medical advances have led to increased life expectancy and the ability to recover from various illnesses, but they have not led to the disappearance of critical illnesses such as heart attack or cancer. 

Critical illness insurance – is it worth it? The chance of getting diagnosed with cancer or having a heart attack is heightened for people over the age of 40. Medical insurance helps reduce costs, but most health insurance plans don’t cover all of the expenses related to treatment. To help deal with this, critical illness insurance provides the funds necessary to pay for whatever you need.

A critical illness can happen to anyone: there are an estimated 70,000 heart attacks in Canada each year, between 40,000 and 50,000 strokes in Canada annually, and an estimated 3,075 Canadians are diagnosed with cancer every week. Despite these staggering numbers, there are options. Critical illness insurance – is it worth it? Yes, because it gives you the peace of mind that can be found when you know that you and your family are protected in the case of a critical illness.

Critical illness insurance – is it worth it? First of all, what is critical illness insurance? Critical illness insurance offers you the financial help you need to pay the costs associated with a life-altering illness, such as a heart attack, a stroke, or cancer. If you become sick with an illness covered by your policy and survive the waiting period, you receive a lump sum cash payment – and you decide how to spend the money. Rather than monthly payments, the lump sum payments allow you to make crucial decisions that help with your financial future. 

Critical illness insurance can be incredibly flexible, as there are no constraints set on how you spend the money, which is typically given after only 30 days. You are not required to submit receipts, or even spend the money on medical expenses. It is completely up to you. You can use the lump sum to pay for alternative treatments, specialist visits, or in-home medical care. The ability to choose how to spend the money also makes it incredibly important in the event that your illness prevents you from earning your regular income.

In the case of your death while the policy is in force, a refund of 100% of the premiums that you paid into your critical illness insurance policy is given to your beneficiary.

Critical illness insurance – is it worth it? Well, what is covered? Your critical illness insurance policy can be customized, but the typical illnesses covered by most policies may include: heart attack, loss of limbs, major organ transplants, severe burns, stroke, multiple sclerosis, coma, Parkinson’s disease, cancer, deafness, blindness, loss of speech, kidney failure, heart bypass surgery, or Alzheimer’s disease.

So, critical illness insurance – is it worth it? If you find yourself diagnosed with any of these illnesses, critical illness insurance gives you the ability to focus on your recovery by eliminating the financial stress that often accompanies many of these illnesses. Your critical illness insurance also allows you to pay for those medical costs incurred that may not be covered by the government or by your employment health benefits. Yes, it is definitely worth it!

For more information on how critical illness insurance can benefit you in the future, please contact Gary Mandel at Independent Financial Concepts Group by calling 416-849-1653 or visit www.wecoveryou.ca

Long Term Disability Insurance – Is My Employer’s Coverage Enough?

Most people are aware of the importance of obtaining life insurance to provide for loved ones in the event of a death, but what happens if you become disabled or suffer from an unexpected illness that prevents you from earning an income?  

Long-term disability insurance is an important provision you need to make for your future. It replaces a portion of your income if you become unable to work for a prolonged period of time due to an illness or injury. It is important to consider that long term disability insurance is going to have the greatest impact on your financial situation. If you are off work for 30 or 60 days, chances are you will be able to cope financially. However, if you are unable to work for a longer period of time, the financial impact can be devastating.                      

There are two basic definitions of disability in long term disability insurance contracts: ‘own/regular occupation’ and ‘any occupation.’ The own occupation definition refers to your ability to perform those duties essential to your own/regular occupation.

Under the any occupation definition of disability, you are considered disabled if you are considered medically unable to perform the essential duties of any occupation for which you are reasonably qualified by training, education or experience. Often the ‘own/regular’ contract will cover a term of two to five years, and will convert to an ‘any occupation’ if you are determined to be disabled at the end of this period. It is important to discuss your options with your insurance broker to decide which long term disability insurance plan you feel best suits your needs.

Some employee benefit packages do contain coverage for disability, although this is often not long term disability insurance. These are typically set at a rate that provides a percentage of salary, for example 50% of your base salary until the employee turns 65. But is this enough? It may not be…

There are several benefits to obtaining additional or supplemental long-term disability insurance coverage. Depending on the policy provided by your employer, you may be covered until retirement or until you recover from your disability. However, this coverage usually does not begin from the time you are off – usually it does not start until short term disability payments, such as sick leave, stop. This means that if additional costs are incurred during this period, you are on the hook. Instead, long term disability insurance provides you with the necessary coverage to bridge the gap between the onset of your illness or disability and the beginning of your employer provided disability insurance coverage.

What if you are injured at home, or in a non-work related incident?  Worker's Compensation only covers work related accidents and unemployment insurance only covers 15 weeks. This can be detrimental if your illness or disability lasts longer than the allotted time or occurs off the job. Personal long term disability insurance takes care of these issues and provides coverage regardless of where the disability occurred, and for a much longer period of time.

With long term disability insurance, the monthly income replacement can often be the difference between being able to support and provide for those that matter to you, and not being able to. Don’t just protect your life, make sure you protect your income.

For more information on how to obtain long term disability insurance, please contact Gary Mandel at Independent Financial Concepts Group by calling 416-849-1653 or visit www.wecoveryou.ca.