An Overview of Insurance Products

This month, I am providing you with a summary of some insurance and savings products to show how they can benefit you and your family members.

Life Insurance

Life insurance policies are issued on a Term or Permanent basis. Term insurance is for a specific time period, usually 10 or 20 years, and will cease at the end of that period. They can also be issued with the option to renew and convert to permanent insurance. Permanent insurance covers the policyholder for his/her lifetime and is an essential part of estate planning, as it provides the family with funds to cover funeral expenses, debt, income replacement etc.

Critical Illness Insurance

Critical illnesses like cancer, heart attack and stroke can be very stressful and costly for family members, as time has to be taken off work to care for loved ones, resulting in loss of income. It is, therefore, very beneficial to get this type of insurance, as it provides a lump-sum benefit 30 days after the diagnosis of one of the critical illnesses, or medical conditions, covered by the contract.

Disability Income Insurance

This type of insurance provides income to the insured in case he/she becomes totally disabled, due to accident or illness.

Mortgage Insurance

This product is used by home owners to cover the mortgage loan on their homes. In the event of the insured's death the mortgage loan is paid off.
Consumers tend to think that they have to take out mortgage insurance with the institution that gives them a mortgage loan, but it is more advantageous to get it from an insurance company because:-

(1) They get to keep the same policy even if they change lenders
(2) The underwriting process is done up front, not at time of claim
(3) They get to choose their own beneficiary

Registered Education Savings Plans (RESP)

These are plans to save money to pay for your child or grand-child's post-secondary education. The child must be a Canadian resident, under age 14, in order to have an RESP. If the child does not go to college you have the option of transferring the funds to your RRSP.

If you are interested in obtaining any of these products please do not hesitate to contact me.

Pauline Bourne, F.L.M.I.
Your Finance & Family Consultant

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