Permanent Life Insurance Options: Whole Life, Universal Life, and Term 100

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There is a myriad of different life insurance products on the market and one broad category of this is called Permanent Life Insurance.

A Permanent Life Insurance policy is one that will never expire in your lifetime regardless of your age.  Some of these policies have a level cost for life while other types will have increasing costs.  There are also limited pay options that shorten the number of years you need to pay on a lifetime policy.

Typical uses of a Permanent Life Insurance policy are in scenarios where the need does not diminish over time such as for final expenses, capital gains taxes at death, legacies, and charities.  Some Permanent Life Insurance policies may also be used as tax shelters where RRSPs and TFSAs have already been maxed out.

There are three main kinds of Permanent Life Insurance: Whole Life, Universal Life, and Term 100.

  1. Whole Life policies will contain an underlying investment fund where the insurance company manages the investment.
  2. Universal Life Insurance policies are similar to whole life policies but allow you to select your own funds within the policy.
  3. The Term 100 is a no frills kind of permanent life insurance policy with no cash value.
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