Personal Insurance Focus: Is Whole Life Insurance the Way to Go?

When it comes to personal insurance, many Torontonians are unsure about what to look for in an insurance policy. Many people are not exactly sure what to expect when searching out policies, or what the difference between policies are. For most people, term life insurance is the type of insurance that most comes to mind – but there are many others that are important to consider as well. One type which is highly advantageous is whole life insurance.

There are many benefits to whole life insurance. If you are thinking about going this route, here are some important things to consider:

Whole life insurance is permanent. When you pay your premiums, your policy continues on, guaranteed – it does not expire. This means that you are protected for your entire life. Unlike term life insurance, which protects you for a term decided upon at the time that the policy is put in place, you don’t need to renegotiate or alter your plan once that agreed upon period comes to an end. You also don’t need to worry about the policy ending and you not being covered.

Whole life insurance premiums won’t increase. When you decide on a policy that meets your needs and the policies are set, these are the same premiums that exist for the entire policy, unlike with a term life policy where premiums increase as you age or if your health deteriorates. When an initial term life insurance policy ends, and you renegotiate, those premiums will be higher because the risks to the insurance company are higher. In a way, this means that you are actually saving money as the whole life insurance policy doesn’t increase even with inflation.

Whole life insurance forces you to save. When you choose whole life insurance and pay the premiums, those policies build up a savings account (also called a cash value) which grows over the years and can be cashed out at retirement or borrowed against if you need to.

Whole life insurance is flexible. Although a whole life insurance policy is permanent, that doesn’t mean that the options you decided upon when you first built the policy are set in stone. Rather, whole life insurance is flexible and can be altered to suit your needs as they change, whether that means increasing your dividends or depositing more premiums.

If you are considering personal insurance for yourself, whole lifeinsurance has a lot to offer. That being said, it is often a bigger premium commitment than term life insurance, primarily because of the additional benefits that do not accompany a term life insurance policy. It is important to speak with an insurance advisor to discuss all of your options and goals to best determine which policy suits your individual needs.

For more information about personal insurance and whether a whole life insurance policy is the way to go for your unique needs, please contact Independent Financial Concepts Group by calling 416-849-1653 or visit www.wecoveryou.ca.