Saturday, December 27, 2008

Universal life policy - risk free investment

This year has been like a hurricane for all investors. Financial sharks, looking for the high profit on the stock markets, suffered heavy losses (or at least most of them).

On the other hand, also conservative investors have lost big part of their portfolios' value. High quality blue chips, real estate - all these sectors have reported declines. As a small investor, looking for simple, risk-free solution, what should you do?

The simplest answer is - nothing. But be aware the inflation in Canada is around 2% and with possible increased government spending next year (due to car industry bailouts) and
possible commodities (especially oil) prices growth may go even higher. So the value of your money is slowly disappearing.

Another solution is to use services of a traditional bank. Unfortunately (for savers), Bank of Canada cut interest rate down to 1.5% (50 years low) and since its big brother FED is holding the key indicator near zero, it's not probable the rate will go up soon. This means your money are in negative real growth even in bank.

But there is one solution, with tool not bounded to the financial market. It's life insurance Canada universal life policy. You can find this product in most offers of Canadian life insurance companies. Base is tax sheltered, so you have guaranteed, risk-free minimal growth of 4%!

You can hardly find similar simple, safe opportunity in these days. Check our site for the offers.

Saturday, December 6, 2008

What about Primerica?

This multi level marketing based company is active on Canadian market for some 20 years. Loved by somebody, hated by somebody else. If you want to start your successful(???) career there,I recommend you to read some articles from (ex)agents of Primerica.

I am here to present you some disadvantages of their PRODUCTS. And since I am insurance broker, it will be about their life insurance.

I have some experience in business (16 years are enough I think) to stress some points

1. Primerica is expensive. Their MLM structure causes additional costs, paid by - you. Your premiums will carry the weight of pyramid of advisers. So before you apply for their policy, check some online quotes, for example at life insurance Canada

2.Term life fits all - at least when talking about Primerica. But not in the real world. Term life is good, often the best, but sometimes permanent policy fits your needs better!

3.Captive agents. They are not going to offer you the complete market range of products. They know what their company offers and you will get no other option.

4.Part time advisers. Do you want your surgeon to be just part time worker? No, I think you would like him to be dedicated to his job. And the same with insurance - financial markets often need precision of a brain surgeon!

5. Non-convertible policies. Primerica is not going to give you the option of turning your policy into permanent. So if anything happens to your health, you have a big problem with your policy's renewal.


Monday, September 22, 2008

Long term care

Daily assistance in our living - something we are not imaginating during our retirement. Unfortunately, we ca never be sure - there is 50% chance of needing long term care after your 75 (according to theUnderwriters LTC council in). This is the price for prolonging human lives....

Long term care insurance Canada - what it is? - It is tool, which will pay the insured individual a tax-free benefit every week, if their medical condition requires to be given assistance with two out of the six activities of normal daily life. Bathing, eating, dressing, toileting,maintaining continence and transferring are all among (usually closer specified by each policy).

Our society is getting older and the expenses aimed on the senior citizens are growing. It creates pressure on public funds, which will be hardly sustainable in some years. Possible answer is the private long term care insurance. I have prepared short presentation in case you want to visit your broker prepared!

Temporary or Ongoing?
Temporary care occurs for weeks or months and is used to describe rehabilitation periods from a hospital stay, recovering from surgery, illnesses or injuries or terminal medicalconditions. Ongoing long term care means the need of assistance in caseof chronic medical conditions or chronic severe pain, permanent disabilities or dementia.

Skilled or Custodial care?
The first one refers to services which can be provided only by licenced medical personnel. On the other hand custodial care refers to services, which are not so complicated to be provided by licensed personnel only - it can be given by any individual. Some long term policies only cover skilled care.

Policies usually have specific limitations reffering to possible facilities - care can be provided at home, in the home of a family member or friend of the recipient, adult dayservices location, in an assisted living facility or board-and-carehome, hospice facilities or nursing home.

Elimination periods
The same as disability insurance in Canada - it refers to the amount of time which must pass before you begin to receive your weekly benefit. The benefitperiod determines how long you’ll receive the coverage for.

Simply - how much are you going to pay for your policy. Elimination period, benefit period and the amount of daily benefits - these are the key factors to influence the premiums. Pay extra attention to premium caps, as most LTC policies inCanada offer guaranteed premiums only for the first 5 years after thepolicy takes effect.

The most important ones are the "cost ofliving adjustment" and "return a premium" riders. The former allows the benefit to be raised according inflation, whereas the return of premium benefit returns the premiums to your beneficiary in the event you passaway.

Wednesday, August 20, 2008

Disability insurance in Canada

Everyone can become disabled. Just one moment of inattention on the road (and it doesn't have to be you, who will make a mistake!) and your professional career is ruined. Of course, in modern world of insurance, there are ways how to be protected. Generally, there are 3 possible solutions (which may be combined).

1. Employer-paid disability insurance
Most of the emplyers have some group policy. Anyway, you should check it properly - it doesn't have to cover everything.

2. The Canada Pension Plan (CPP) disability benefit
This is the basic protection, provided by the government. It can save you from the worst, however, don't expect you will be able to handle the same living standard, not to say about new needs, emerging from your disability!

3. Private disability insurance
Disability insurance Canada policies, provided by private insurance sector.  You can buy a policy, which will be paying you regular monthly payments for certain period. All conditions are negotiable - bonus period (for how long you will be getting the money), elimination period (when will you get your first payment), sum of the payment, type of the policy (cancelable/ non-cancelable). You can apply also for discounts, eligible to some occupations. 
So remember, disability insurance in Canada can do a lot for you!

Wednesday, July 16, 2008

What is not covered by life insurance policies?

Life insurance Canada is a contract. And just as the insured desires protection, so, too, does the issuing company.

How does the average life insurance company protect itself? By writing policies that protect them from the following five common dangers:

All life insurance policies have a suicide clause that protects the company from individuals intentionally seeking to commit suicide and pass on a death benefit. Two years from the date of issuance is the normal period for such clauses.

Anyone who dies because of an act of war, be he a soldier or a non-combatant, will not be covered by most life insurance policies. It makes sense that an insurance company would seek to protect itself against war related deaths for which it simply could not afford to pay.

3.Hazardous behaviour.
So, too, those who engage in hazardous pastimes such as acrobatic flying or bungee jumping: proceeds of policies may be witheld should they lose life or limb while participating in such activities.

4.Restricted countries.
Any insured who travels regularly to regions where disease or strife regularly claim the lives of locals and/or tourists may also find himself excluded from benefits should he fall victim during his travels. (Many insurance companies simply raise premiums for frequent visits to such regions).

5.Faulty applications.
All insurance policies contain incontestability periods – usually two years – during which an insurance company may choose not to pay if it believes an application was submitted that withheld information or otherwise sought to fraudulently obtain a policy. Even though the insured obtained the requisite inspection report and underwent a medical, most companies lean heavily on the applicant’s input to determine the appropriate coverage and premium. If it’s determined that full disclosure would have denied the applicant a policy (or even lowered his rating), the company is not obliged to pay.

Tuesday, July 15, 2008

Which type of life insurance is best: term or permanent?

The cost of an insurance policy should almost never be the final determinant of which type of product to buy. There are advantages and disadvantages to both term and permanent life policies, and it’s important to figure out one’s personal insurance objectives before making a choice.

Term insurance was designed with cost in mind. It offers inexpensive protection for a temporary period, usually 10 or 20 years, and is normally purchased by those who have a specific objective in mind – usually coverage of a mortgage, line of credit or business loan. For those who worry about leaving such debts behind in the event of an early death, term life insurance offers a simple solution.

A single example will serve to prove the cost efficiency of term life insurance Canada:

A 40-year-old male non-smoker can take out $250,000 of term-20 coverage with Canada Life for $37.58 a year. But that same applicant will have to pay $214.20 a month for $250,000 of 20-pay whole life coverage with Empire Life.

Need we say more?

But for those who desire an investment component to their insurance coverage, term will certainly not do. All the premiums paid into a term life policy are unrecoverable at the conclusion of the term purchased.

Not so with universal life and whole life (permanent) policies, whose premiums are considered “paid-up” and provide cash surrender values and policy loan opportunities for the insured. In many cases the option of what types of securities and where to invest is also left to the discretion of the insured.

For those who seek to purchase life insurance but want more flexibility with their paid-in premiums, the added cost of whole life or universal life policies are clearly worthwhile.

In some cases, a mix of term and permanent insurance may best meet the needs of an applicant with more complex needs. It’s always best to consult with a financial advisor before making such decisions.