Frequently Asked Questions

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Life insurance is a contract between the insured and an insurer that guarantees a tax-free,

lump-sum payout upon death in exchange for premium payments by the insured. This lump-

sum benefit is then paid out to a specified beneficiary or beneficiaries, and is often used for a

wide variety of reasons such as (but certainly not limited to) building generational wealth,

covering funeral costs, and protecting family finances.

A life insurance payout is formally-known as the “death benefit”. The death benefit is paid

out to the beneficiary (or beneficiaries) of the policy when the life-insured dies. It is normally a

lump-sum payment received tax-free.

Life insurance can be issued for a specified term (term insurance) or permanently. There

are 3 types of permanent life insurance:

Term-to-100 – a permanent life insurance protection plan that guarantees level premiums until

age 100

• Ideal for those who wish to keep premium costs to a minimum for permanent life
• coverage
•  The cheapest form of permanent life insurance
• No cash value, not very versatile
• *Premiums are offset if you live to see 100 years of age

Whole Life – a permanent life insurance protection plan that also accumulates a cash value

• The most common form of permanent life insurance
•  Potential to earn dividends through participating policies (see more below)
•  Many use the cash value element of the policy for saving purposes
•  Premiums are fixed

Universal Life Insurance – a permanent life insurance protection plan that accumulates a cash

value through an investment savings element and allows for flexibility with its premiums and

death benefit

•  Most flexible permanent plan, thus the most expensive
•  Suitable for sophisticated investors & those with comfortable assets & income
•  The cash value earns an interest rate set by the insurer, which can be subject to change
•  No tax implications for policyholders who borrow against the accumulated cash value (withdrawals may be taxed)

Everybody's life insurance needs vary based on a wide variety of things (i.e. health, age, gender, # of dependents, etc.).  Book an appointment today to find out what life insurance policy best suits you! https://calendly.com/marcusshirley2/30min

Absolutely! Loan limits against the policy are often set by the insurer but are typically no

greater than 90% of the policy’s cash value. Many people use life insurance policies as

collateral for their business/mortgage loans. Pretty smart, huh? 

Most insurance companies do not issue term policies to anyone over age 75, and permanent

policies are seldom issued to those over 85. One’s health could also deter insurance companies

from issuing them a policy.

We recommend that those aged 75 and older still book an appointment to look into their

options for purchasing life insurance with a licenced agent. The worst an insurer can say is no; we don’t want to see that happen anyway! 

A term insurance policy would be most suitable for a life insurance policy issued on a child’s

life. Adding renewable and convertible features allow the policyholder to renew their contract

when it expires, and convert their contract to any type of permanent policy upon expiry.

The beneficiary is the person(s) to whom the death benefit would be payable. While the

beneficiary is an extremely important designation, the beneficiary is not technically a “party” to

the contract—which means that they need not know they have been named as the beneficiary

to be entitled to the death benefit!

Leaving a group life insurance policy at your job in pursuit of an individual policy can offer several potential benefits, depending on your individual circumstances and needs.  These benefits include but are not limited to, customization, portability, and long-term stability.

However, it's crucial to consider the potential downsides too, including potentially higher initial costs, the need for a medical exam or health screening, and the requirement to manage the policy yourself.  It's often a good idea to consult with a financial advisor or insurance professional to evaluate your options and make an informed decision that is based on your needs.