Whole Life Insurance
Whole life insurance is a permanent policy designed to provide lifetime coverage, a guaranteed death benefit, and a cash value component that grows over time. It combines long‑term protection with an element of savings.
Key Features
Lifetime Coverage: Protection lasts for your entire life as long as premiums are paid.
Guaranteed Death Benefit: A payout to beneficiaries regardless of when you pass away.
Cash Value Growth: A portion of premiums builds cash value with tax‑deferred growth.
Level Premiums: Premiums are typically fixed for the life of the policy.
Financial Security: Helps support beneficiaries, final expenses, and legacy planning.
Estate Planning: Can be used to cover taxes and transfer wealth.
Potential Tax Advantages: Death benefits are generally tax‑free in Canada, and cash value grows tax‑deferred.
Types of Whole Life Insurance
Participating: May pay dividends that can increase cash value or reduce premiums.
Non‑Participating: Fixed benefits without dividends.
Limited Pay: Premiums paid over a shorter period, but coverage continues for life.
Single Premium: One‑time payment for lifetime coverage.
Frequently Asked Questions
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Why choose whole life insurance? It offers lifetime protection, guaranteed payouts, and a growing cash value for long‑term planning.
What affects the cost? Age, health, coverage amount, and optional riders.
What should I consider? Your long‑term goals, budget, and how permanent coverage fits into your overall plan.