Whole life insurance (sometimes referred to as permanent or cash value life insurance) is a type of life insurance policy which is guaranteed to remain in force for the insured person’s entire lifetime, provided that the required premiums are paid for the duration of the policy or until the maturity date.

Since whole life policies are guaranteed to remain in force for the insured person’s entire lifetime and never expire, the premiums are typically higher when compared to a term life insurance policy.

The premiums of a whole life insurance policy are fixed for the entire duration of the policy and are based on the age of when the policy is issued. The premiums usually do not increase and the insured person is required to pay premiums for their entire life or until the maturity date.

Whole life insurance policies are used by people who want a guarantee that the death benefit of their policy will eventually be paid out regardless of their age. The death benefit is paid out tax free at death and is usually used to cover the following needs (personal or business),

Personal Uses

– Funeral expenses
– Estate planning (taxes payable at death)
– Taxes at death
– Inheritance
– Charity legacy
– Income for a surviving spouse

Business Uses

– Buy sell agreements
– Key man insurance
– Retirement planning
– Deferred compensation

These policies can also accumulate cash inside of the policy over time. This cash grows on a tax deferred basis which means that the growth of the cash investment is not subject annual taxation. Depending on if or when you do wish to access the cash investment inside of the policy in the form of a withdrawal or loan, there may be taxation depending on the ACB (adjusted cost base) of the policy. This is where these policies become more complex and we advise you to speak with us for further information.

Whole life insurance can be very basic or extremely complex. We recommend that you consult with us if you are interested as we can work together to understand your situation in more detail to ensure that you are choosing the most appropriate plan from the right insurance provider for you and your family.

West Coast Life Insurance is available to work with you and provide a no obligation consultation on your existing policy or if you are considering purchasing life insurance. Please do not hesitate to contact us with any questions or concerns that you may have.

West Coast Life Insurance
Email – simon@westcoast-lifeinsurance.ca
Phone – 778-484-2683