In this Insurance 101 blog we’re covering one of the most common questions asked by people shopping for insurance – what’s the difference between Term Life Insurance and Permanent Life Insurance?
What is life insurance?
In its simplest terms, a life insurance policy is a contract to provide a guaranteed payment of a lump-sum of money upon the death of the person who is insured. In return, the owner of the policy agrees to pay regular payments, called premiums, for a specified period of time.
When it comes to buying insurance, you’ve probably heard this expression before. While it would be great if you could, in fact, purchase insurance at the time of an emergency, it’s best to be prepared for the unexpected, no matter the likelihood of an event. This adage could be taken as a reminder to not neglect your insurance policies, but what does it really mean, and how does it relate to purchasing life insurance?
One of the complaints I hear about insurance advisors is that they sometimes frustrate people by using fear to pressure their prospective customers to buy. When I started as an advisor, I swore to never use scare tactics and tell stories about people in my network who did or didn't have insurance, and the impact it had on their lives. But something happened recently that I felt compelled to share.
When the temperature starts to rise in the spring and summer months, so does Canada's housing market. As we think about the Dos and Don’ts of buying a new home, it's important to think about what type of insurance is needed to protect our investment. Mortgage insurance may seem like a practical option, but is it the best one? And what are its drawbacks?
John Lennon once said: “Life is what happens to you while you’re busy making other plans.” This rings true in many aspects of our lives – in our jobs, our families, our homes. And also in our investment plans, as we think about the future and how we will achieve our financial goals. But sometimes, things happen that can derail these plans and good intentions.