Not your parents' life insurance
How the process of buying life insurance is changing for the better
LET'S FACE IT, YOU'D BE HARD-PRESSED to find someone who says they really look forward to buying insurance. As a result, more than six million households across the country acknowledge they don't have enough life insurance, according to a recent study. That's 45 per cent of Canadian households - up from 38 per cent in 2006 and 33 per cent in 1999 (1). One reason is a widespread perception that the process of choosing and applying for appropriate coverage is difficult and time-consuming.
That may have been a problem in the past, but it's no longer the case. Like many other purchases, obtaining life insurance is getting easier, faster and more flexible, dramatically improving the customer experience. So, if you've been thinking about insurance but have been hesitating to buy it, there's no time like the present to explore new solutions with your advisor.
Applications are easier. Streamlined application processes, including less intrusive requirements and electronic submissions, mean it's become much easier to get the "paperwork" done. Many products don't require medical evidence, such as blood tests, saving time, inconvenience and discomfort. In some cases, everything can be wrapped up in one meeting.
Decisions are faster. With simpler and more streamlined processes in place, insurers can approve policy applications - and provide coverage - more quickly. If you need term insurance, for example, you may be able to have your coverage in place in as little as one business day after you apply.
Choices are flexible. Life insurance has evolved a great deal, and can now be tailored to your specific needs. One of the most exciting developments is the introduction of policies that let you earn rewards and save on premiums when you make healthier lifestyle decisions. As insurers continue to innovate, you can expect more choices and greater flexibility.
Value was never a question. In a recent survey, 54 per cent of respondents were concerned about providing for their family if they died unexpectedly, and 43 per cent said that a top reason to have life insurance was that it was good, wise or necessary. One-third (33 per cent) said that if the family's main breadwinner died, was disabled or became critically ill, they would have immediate trouble meeting every expenses. (2)
What's been standing in the way, for many, is the impression of complexity. But the reality is, with support from your advisor, getting the life insurance coverage you need isn't a hassle. In fact, buying life insurance may be the simplest part of implementing your overall financial plan. For more information, talk to your advisor about your personal situation and the protection you need.
ASK BEFORE YOU BUY
Here are some of the most important questions to ask your advisor before you buy life insurance.
1. How much insurance do I need to protect my family?
2. What's the best kind of insurance for me - term or permanent?
3. Will this always be the right choice? If not, when will we review my needs again?
4. What do I have to do to apply? Are there lots of forms? Do I need to give blood?
5. How quickly will I find out if my application has been accepted?
6. What happens if my health changes after I buy the policy?
7. Is there any flexibility if I can't afford the premiums at some point in the future?
8. Should I consider any riders - for example to protect other family members too?
*information courtesy of Manulife Financial Solutions magazine Fall 2016 edition
(1 & 2) LIMRA, 2013 Canadian Life Insurance Ownership Study