Life Insurance

Do you need life insurance?

Will your dependents be financially impacted if you should die prematurely?
If so then you should explore how you can help protect them with life insurance. At Merit Insurance our brokers will help you determine if you have a need and how much that is to provide protection in the event of your premature death. Your Merit broker will consider other coverages you may have through work, to determine if it is enough to meet your needs.

Did You Know?

“Your work life insurance coverage typically ends when you leave your job.”

What is Life Insurance?

Life insurance is a form of financial protection for you and your family. If you have loved ones that are financially dependent, it can help protect their future needs and security. If you died prematurely, your beneficiaries would receive a tax-free lump sum that can be used to:

replace your lost income which will ensure they can maintain their living standards
pay for your children’s education
pay off debts (see Mortgage Life Insurance vs life insurance used to pay for mortgage debt)
cover your final taxes
funeral expenses

Some people purchase life insurance from their financial institution when they get a mortgage. There are key considerations when considering mortgage insurance and life insurance used to pay off a mortgage.

Key Differences between Life and Mortgage Insurance

Mortgage life insurance is offered by banks and independent life insurance is offered by life insurance agents.
Mortgage life insurance is priced based on your age and amount of mortgage at the time of arranging the mortgage. Life insurance is priced based on age, coverage amount requested, and health condition at the time of underwriting.
One key disadvantage of Mortgage insurance is that the death benefit declines over time as you pay down your mortgage and yet your premiums remain the same, unlike life insurance where the death benefit is defined.
When the insured dies the death payment is made to the lender to pay off any remaining debt vs paying out to the beneficiaries to decide on how to use the money.
It might be a better choice for borrowers who are in poor health or who have poor medical histories.

The 2 Main Types of Life Insurance

Term Insurance

This meets short-term or temporary protection needs. There are a variety of terms available from 5 years to 20+ years.

Benefits

Predictable premiums – Your premiums are fixed and guaranteed not to change for the length of the term.
Convertibility – Convert your 10-year or 20-year term life to permanent life before you turn 69.
Tax-free cash benefit – Your beneficiaries will receive a lump sum, tax-free benefit if you die during the years of coverage.

Whole Life

This is referred to as permanent insurance because it can protect you for your lifetime, with a guaranteed death benefit and level premiums. A whole life plan increases in value over time and is subject to investment gains/losses.

Make well-informed decisions with your Merit Broker. There is no cost to talk to our life insurance specialists to make sure you get the right type and amount of life insurance for your loved ones’ needs.

Click here to get a Life Insurance quote or contact Merit Insurance Brokers to learn more.