Your Life In Insurance

By Caitlin in Posts

When younger, you probably learnt that you would need a mortgage one day to finance the
home of your dreams. What you maybe didn’t realize was that would also need a whole set of different finance packages, instruments and share dealing accounts to guide you through life’s up and downs and to ensure your financial freedom when you are old enough to enjoy it.

Here’s a brief look at some of the challenges you might face.

Insurance Isn’t What You Thought

Everyone knows about the importance of car insurance in case your car gets involved in an
accident or gets stolen, but have you considered how your partner would manage if you pass away first, leaving children to be looked after while your salary goes forever? Life insurance can provide the money the family requires at the worst possible time of their lives. Without it, your partner might have to sell your home, move down-market and try to feed your family on a fraction of the income.

This often happens to people when there is no insurance or inadequate insurance cover. At a time when a family should be grieving, the person left behind has to deal with practical issues about how to survive. How often do you see people in this situation move into smaller homes, take second jobs and struggle for years? Insurance can solve some of these problems, but you need to find the right policy first. For many people, the time to make that decision is when they buy their first home.

Mortgage or Term life insurance?

If this is your first mortgage or you are refinancing a mortgage, you have almost certainly
been informed that you need life insurance to cover the mortgage. In fact your bank will
insist on it. Don’t just take the easy decision – see what else is available as you may be able
to make savings over the long term. You will need to choose between the two main types of
insurance on offer when you take out a mortgage.

Mortgage life insurance is a policy that pays the bank the mortgage debt on your death, or
that of your partner. Term life insurance covers more than your mortgage in case you need
extra funds at the time. The money will be paid to your estate on your (or your partner’s)
death. You can then clear your mortgage and use the excess funds carefully.

A term life insurance policy might prove more useful to you than a mortgage life policy.
It will cost less to purchase a term life policy while you are young. Buying a mortgage life
insurance policy and separate term life insurance policy will cost you more, especially if
you’re buying one policy later when you are older and may have been subject to health

Health insurance

Health challenges can take us completely by surprise. We often think we are perfectly healthy until we are not – and if we haven’t planned ahead it can be too late. Having the right insurance policy in place can help. There may come a time in life when you need to gain access to a hospital for surgery much quicker than your hospital will admit you. While our Canadian healthcare system is among the best in the world, sometimes you just don’t want to have to wait.

That’s where health insurance can help. Having health insurance will provide the financial
means to pay those private hospital bills which might mean the difference between living
happily ever after or being struck down with further illnesses because you weren’t able to act quickly enough. Sure, we don’t have the same problems as our American neighbours when it comes to healthcare, but is that an excuse for complacency?

A similar story arises if you or your partner ends up disabled through injury or poor health.

How would your family cope with the loss of income and perhaps the other partner being
required to stay at home to look after the one who is ill? Disability insurance will come in and save your financial problems.

Life Can Be Difficult

You’ll meet many ups and downs during your lifetime unless you’re very lucky. Insurance is there to guide you through the dreadful times. If you’re worried about making your insurance payments, invest your savings in a Share Dealing Account to increase your income. Then you will be able to update those insurance plans.


All consultations and conversations with Loans Canada and its partners are confidential and risk-free. Speak with a trusted specialist today and see how we can help you achieve your financial goals faster.

Loans Canada and its partners will never ask you for an upfront deposit, upfront fees or upfront insurance payments on a loan. To protect yourself, read more on this topic here.