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Helping Clients Reach Financial Security
"No Matter What"
 
Ken Armstrong 
Insurance & Financial Services
Milton, Ontario 
905-878-0951
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Term insurance  is similar to Renting a Home, rates increase and it is something you never own.
Term insurance is the most basic form of life insurance. A pre-selected amount is paid if the insured person dies prior to a specified age. Term insurance is often bought for temporary needs. The premium rate depends on factors such as the age, gender, health status and smoking status of the person who is insured.

There are many variations of term insurance.
Here are examples:

The length of the term: such as 10 years (T10), 20 years (T20) or until age 100 (Term-to-100, or T100). Although the likelihood of death increases each year because of aging, premium rates are usually adjusted to be level during the term. So the longer the term, the higher the premium rate.

Renewability: meaning that coverage can be renewed at the end of the term for the same period for a higher premium. Most plans are guaranteed renewable to a specific age like 70 and the renewal premium rates are usually guaranteed when the policy is originally purchased.

Convertibility: meaning the term policy can be changed (or converted) to permanent insurance without requiring underwriting. There is usually a maximum age for conversions, such as 65.
the degree of underwriting. Some plans have additional underwriting requirements to evaluate applicants more precisely. A person with better than average health is rewarded with preferred rates.
Combinations are possible. For example, Term 10 Renewable & Convertible means term insurance for 10 year periods that can be renewed at the end of each 10 years for a higher premium, and which can be converted to permanent insurance.

The need for term insurance depends on a your financial situation and the financial consequences of an early death. Typically, the need for term insurance decreases with age. Thatís good because premium rates increase dramatically with age. At younger ages, savings are usually low because of significant liabilities such as a mortgage or the cost of childrenís education. So the need for term insurance is high, as the Insurance Calculator can estimate. Later in life, savings increase as liabilities decrease and the need for term insurance drops.

The drawback of term insurance is that it does not have a savings component to take advantage of the special tax advantages of life insurance. An alternative is universal life insurance, which combines term insurance with tax deferred savings IT87R2 under the Income Tax Act..

You can estimate the amount of term insurance you need using our Insurance Calculator.
Note!!. Do not forget that there are survivor benefits under your Canada Pension Plan Benefits if you qualify!

Once you have calculate your need for tax free money, you can now calculate your own individual costs Premium Survey