Term Life Insurance
Term Life Insurance
Term Life Insurance: Simple, Affordable Protection
Term life insurance is a straightforward and cost-effective way to protect your family, business, or estate needs for a specific period—typically 10, 20, or 30 years. It’s designed to provide peace of mind by ensuring that your loved ones receive a tax-free payout if you pass away during the term of the policy.
Think of term insurance as renting your life insurance coverage
It’s temporary.
It has no cash value.
Coverage typically expires by age 85.
Premiums are affordable at the start but increase significantly at renewal.
Because of its low initial cost, term life insurance is ideal for
Covering debts like mortgages or loans
Protecting your income while your children are growing
Meeting business obligations or funding shareholder agreements
However, once the term ends, your premiums increase—often drastically. That’s why it’s important to plan ahead and explore converting some or all of your coverage to permanent life insurance if lifelong protection or tax-sheltered growth is important to you.
Common Questions About Term Insurance
How do premiums work?
Premiums are level during the term but increase significantly if you renew after 10 or 20 years.
What happens when my term ends?
You may renew at a higher cost, convert to a permanent policy (without medical underwriting), or let the policy expire. If you want lifelong coverage, a permanent policy, or a combination of term and permanent, it may be more cost-effective in the long run.
Can my corporation own the policy?
Yes. Corporate-owned life insurance can be a smart strategy for incorporated professionals and business owners. It offers tax advantages, including the ability to credit the Capital Dividend Account (CDA), allowing for tax-free distributions to shareholders upon death. Be sure to speak with your accountant and lawyer to ensure this structure aligns with your goals.
Will I get a lower rate for the same product and insurance company from another advisor?
NO. The insurance industry has standard rates for all advisors on insurance. If you are seeing a lower rate, perhaps another advisor is showing you a preferred rate which depends on your health status, application, and medical results.
Final Thoughts
You’ve invested over a decade in your education and career. Why leave your financial protection in someone else’s hands?
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