What’s the best time to buy life insurance?
There are often life events that motivate people to consider getting life insurance.
You’re now making financial decisions as a couple. Life insurance can help keep 1 spouse’s death from financially devastating the other. If you provide for your family, or have more debt than assets, life insurance can help keep your loved ones financially secure if something happens to you. They can use your death benefit to pay for your funeral, cover everyday living expenses, settle debts (including your mortgage) and fund future education for any children.
Becoming a parent
Life insurance can help provide for your child and your family if something happens to you. You may also consider buying life insurance for your child.
Buying a home
With life insurance coverage you can help make sure your family can pay off the mortgage and other expenses if the unexpected happens.
Starting a business
When 2 or more partners start a business, having life insurance can provide funds to allow surviving partners to run the company. Business-owned insurance provides a one-time payout to your company if you, your business partner or key employees die. It can help cover business debt, overhead expenses or a partner buy-out.
That doesn’t mean you can’t or shouldn’t buy life insurance if you’re single. Being young and healthy are good reasons to get life insurance because generally you’ll pay less for your life insurance when you’re younger.
Other types of insurance to consider
Critical illness insurance
Critical illness insurance can give you a tax-free payment if you’re diagnosed with a serious condition. Your contract will define which conditions you’re covered for, but some examples include cancer, heart attack or stroke.
Disability insurance can give you a tax-free monthly payment to help replace your income and cover your expenses if an illness or injury keeps you from working.
While a disability can often be visible to the naked eye, not all disabilities are so easily recognized. Chronic pain or a mental health issue can also qualify as a disability.
Now that you understand more how much life insurance you need, you may want to contact your advisor to:
Determine how much life insurance to purchase
Determine what kind of life insurance to buy
Discover how life insurance fits into your financial plan
The information provided is based on current laws, regulations and other rules applicable to Canadian residents. It is accurate to the best of our knowledge as of the date of publication. Rules and their interpretation may change, affecting the accuracy of the information. The information provided is general in nature, and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors.