| Life Insurance | |
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RRSPs and RRIFs GICs Medical Plans Segregated Funds Critical Illness Coverage Life Insurance Products |
Obviously, no amount of money can offset the loss of a human life. The best purpose of life insurance is to offset the financial loss resulting from a person's death. Life insurance should be viewed as a key element in the risk management portion of any good personal financial program.
The first step in developing a proper life insurance program is to determine what those financial risks are. As part of an estate review, we work with you to determine what would need to be taken care of right away in the event of death. Paying off the mortgage and all the other liabilities, setting up savings or trust funds for children or grandchildren or perhaps leaving a donation to a favourite charity are identified. We then determine what level of income would be needed to maintain the lifestyle of surviving relatives. From there, we determine how much is already available to satisfy those immediate and income needs. We include existing insurance, both self-owned and group, government benefits and other sources of capital. (Existing savings, for instance.) The difference between these figures is the amount of insurance you need. This is the easy part! The type of life insurance used to create your insurance program depends on a number of factors; how long the coverage is needed, what type of risk is involved and of course, your budget are just some of the determining factors. We are able to do business with dozens of life insurance companies in Canada so you are assured that the product recommendations we make are based on the best combination of features and value for your situation. There are a number of uses for modern life insurance products, both universal life and term insurance that were nearly unheard of years ago. For instance, on the death of a spouse, remaining RRSP and RRIF balances roll over to the surviving spouse without taxation. When that second spouse dies, the remaining balance is taken into income and become taxable - often at the highest tax rate! This means that half or more of one's remaining RRIF balance goes to Ottawa. One cost-effective solution to this tax trap is insurance that only pays on the second death. This type of coverage is much less expensive than policies based on just one individual! This trap also applies in the case of recreational or other capital property because of the capital gains tax calculated when the property moves from one generation to the next. Whether your need is for simple term coverage to suit a tight budget or a more sophisticated solution for a complex situation, we will help you develop the program that is exactly right for you. "If I had my way, I would write the word "INSURANCE" over the door of every cottage and upon the blotting book of every public man, because I am convinced that for sacrifices which are inconceivably small, families can be secured against catastrophes which otherwise would smash them up forever." |