Canada Life Insurance Review

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Canada Life Insurance Review

Written by Caitlin Wood

Canada Life Insurance Review

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Insurance Provider Review Life Insurance

Canada Life has been in the insurance industry for over a century-and-a-half and has amassed a long list of insurance clients over the decades. Founded in 1847, Canada Life — officially known as Canada Life Assurance Company — was the first life insurance firm in Canada. The brand now covers three companies: Canada Life, Great-West Life, and London Life. 

Canada Life provides insurance and financial services in Canada, the UK, Germany, and Ireland. The company is also philanthropic and dedicates a minimum of 1% of its pre-tax profit to various charities.

Right now, Canada Life is offering 4 months of free premiums for some term life insurance policies in most provinces. In BC, new clients can receive up to 3 free months of premiums. Policies must be submitted by December 1, 2020.

If you’re looking to take out a life insurance policy, Canada Life will likely have what you need given its vast array of insurance products. Let’s take a closer look at Canada Life and what it has to offer in terms of life insurance products.

Types of Life Insurance Canada Life Offers

Canada Life offers a full suite of life insurance policies, including the following:

Term Life Insurance

Having a life insurance policy in place while you’re a major contributor to the household finances can provide your family with financial assistance if you should ever pass away before you retire. A term life insurance policy can provide you with affordable coverage while still ensuring that your family is adequately protected during the years when they need you most. 

This type of life insurance offers temporary coverage that lasts for a specific time frame and usually renews automatically. As long as you keep up with your premium payments, your policy will remain active and your beneficiaries will receive the death benefit if you pass away during the term of the policy. 

Term policies are best suited for those who still have mortgages to pay, lines of credit outstanding, and other long-term debts that need to be paid down. They’re also ideal for individuals who want to make sure their children are provided for until they’re financially stable. These policies are also great for Canadians who want coverage but also want to keep their costs low.

Canada Life offers 4 terms for you to choose from that works best for you:

  • 10-year term
  • 20-year term
  • 30-year term
  • Term up to age 65

Canada Life offers optional benefits that can be added to your policy to customize it. When the term expires, you can either renew your policy or convert it to permanent life insurance without having to undergo any medical exams.  

Permanent Life Insurance

With a permanent life insurance policy in place, you’ll have lifetime coverage that will never expire while you’re still living. No matter what your lifespan, you’ll always be covered as long as you’re up-to-date with your premium payments. 

You can also use a permanent life insurance policy as somewhat of an investment thanks to its cash value component. This can help you build wealth while keeping your loved ones financially protected. You can let the cash value continue to grow and use it in the future to cover the cost of major expenses. This can include paying for your child’s college or university tuition or saving up for retirement. 

When you pass away, your beneficiaries will receive a tax-free death benefit, less any funds that you may have withdrawn from the cash value component of your policy. 

Canada Life offers 2 types of permanent life insurance policies: participating and universal life. Both come with lifetime coverage and the chance to grow your wealth tax-free: 

Participating life insurance. With this type of lifelong coverage, your payments are pooled in a participating account with other policyholders. The money held in this account is managed by an investment professional and may pay out dividends, depending on your plan. As long as you keep up with your premiums, your cash value will be guaranteed.

Universal life insurance. There are two components to a universal policy: insurance and investment. This permanent life insurance policy offers flexibility with payment schedules and investment types. Once you’ve covered your insurance costs, any extra funds go towards the investment component to help you build wealth tax-free.

Critical Illness Insurance

A critical illness insurance policy will provide a payout if you are diagnosed with a serious medical condition that forces you to stop working. The policy will help provide financial compensation to make up for lost income. You and your family won’t be left scrambling to try and pay the bills without an income. Plus, you can protect your retirement savings.

Your specific policy will outline the conditions you’ll be covered for, though some of the more common illnesses covered include heart attack, stroke, and cancer. 

Disability Insurance 

Disability insurance will provide you with a monthly income to help cover household expenses when you’re unable to work due to a serious injury that has left you unable to work. The payments you receive from your policy will replace part of your monthly pay cheque. You can get up to 80% to 90% of your take-home pay.

Qualified disabilities include those that affect you physically but also those that impact your mental health too. 

When the benefit period ends or you’re able to return to work, your payments stop.

Business Life Insurance

If you own a business, you may want to consider having a business life insurance policy in place to protect your business partners, your employees, and your company’s assets. With a corporately-owned life insurance policy, a lump sum payout will be provided if you or key partners or employees die. Like personal life insurance, you can choose between a term or permanent life insurance policy.

Pros and Cons of Using Canada Life Insurance

Pros 

  • Long-standing track record. Considering Canada Life’s history dating back to the mid-1800s, the company has plenty of experience in the insurance industry. 
  • Many policy options. Canada Life offers several life insurance options to suit your needs and the needs of your family or business. 
  • Ability to convert shorter-term policies into longer-term policies. If you decide that a longer-term policy is better suited for you at any point throughout your term policy, you can extend it to ensure adequate coverage. 
  • Option to include critical illness or disability insurance. Canada Life offers traditional life insurance that pays out a death benefit to your named beneficiaries when you die. But, you also have the option to add critical illness or disability insurance. These policies will cover you if you are ever unable to work due to significant illness or injury.
  • Term policies may be carried to a specific age rather than a certain number of years. They can come in a fixed number of years, but may also last until a certain age. With Canada Life, you may be able to carry your term policy up to the age of 65 when you retire instead of a set term.

Cons

  • Term length options are rigid. While Canada Life provides a few options for term insurance, you can’t choose your own specific term length outside of the terms offered. 

Cost of Obtaining Life Insurance With Canada Life

The cost associated with a Canada Life insurance policy will vary depending on a number of factors:

  • Your age
  • Your current health status
  • Your gender
  • Your occupation
  • Family health history
  • Whether or not you smoke
  • Your location
  • Policy type (term versus permanent)
  • Term length (if you choose a term policy)
  • Coverage amount

Based on the factors above, a 30-year old non-smoker looking for a 20-year term policy for $500,000 would be looking at premiums anywhere from $35 to $40 per month. These premiums would be much lower than a policy for a 50-year old smoker looking to take out a permanent policy for $1 million or more. 

The younger and healthier you are, the cheaper your policy premiums will be. That’s why it’s recommended to apply for a life insurance policy earlier in life, as the chances of developing a health issue later in life are higher. 

Canada Life Insurance Application Process

To get a quote for a life insurance policy, you’ll need to speak with a licensed agent and provide various pieces of information about yourself. These include your full name, date of birth, and contact information.

You’ll be asked a series of questions about your health, such as whether or not you smoke, any health conditions that you’re currently suffering from, or if you’ve had any past medical issues. The questionnaire may be lengthy, but the more information Canada Life has to work with, the more accurate your quote will be. 

If you choose to go ahead with a policy, you may or may not be asked to undergo a medical exam, depending on the policy you choose and your current health status and lifestyle. You may also be asked to provide a copy of a government-issued photo ID to verify your identity.

Canada Life Insurance Claims Process

When you pass away while your life insurance policy is still in effect, your beneficiaries will be paid out the death benefit after they’ve submitted a copy of your death certificate. 

If you have a critical illness or disability insurance benefit on your policy, you can file a claim to receive a payout to replace a portion of any lost wages as a result of an illness or injury. Your insurer will require proof of your illness or disability, which you can provide along with your claim. 

Canada Life Overview

Term Life Insurance
Term– 10, 20, 30-year terms
– Or up to age 65
Coverage– Up to $10 million
Renewable– 10, 20, and 30-year terms are renewable
– Term to age 65 is not renewable 
Age range – 10-year term: Available for issue until age 75
– 20-year term: Available for issue until age 65
– 30-year term: Available for issue until age 65

Final Thoughts

A life insurance policy will provide you and your loved ones with the assurance of knowing that the bills will continue to be paid even after you’ve passed away. But a policy requires an ongoing financial commitment. As such, the policy should not only provide the right amount of coverage that you need but should come with premiums that fit well within your budget. 

At Canada Life, you’ll have plenty of policy options to choose from, including add-ons like critical illness and disability insurance. You can also choose to take out a corporate-owned life insurance policy if you run a business and want to ensure that its assets and partners are protected. With so many options to customize your policy, Canada Life has plenty for you to choose from.

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