Whole Life Insurance Vancouver
If you are looking for whole life insurance in Vancouver, you have many insurance carriers to choose from. Popular carriers for whole life purchases in Vancouver include Sunlife, Equitable, Manulife, Canada Life, Empire, RBC, BMO, and Wawanesa. Each of these carriers will have their own strengths and weaknesses including the projected returns, historical returns, investment mix, and minimum guaranteed cash values.
Comparing Vancouver Whole Life Insurance
A useful method of comparing each Whole Life Insurance offering that is available in Vancouver can be to input the same premium and parameters to each product and see how the resulting death benefit and cash values compare over the years. It is important to note that the premium / death benefit ratio can vary widely among carriers offering the same product. By restricting the input premium to the same amount and same payment period, regardless of how much the resulting death benefit is, you are able to produce a fair cost-benefit comparison.
Below are some important parameters to consider for whole life insurance.
Projected vs Guaranteed Death Benefit
Whole life insurance policies will generally show two death benefits columns, a guaranteed column and a non-guaranteed column. The non-guaranteed column shows the companies projection of death benefit based on the current dividend amount. The non-guaranteed death benefit can vary from year to year depending on the market conditions and current dividend scale. The guaranteed death benefit for each given policy year is the minimum death benefit that will be paid regardless of how the policy’s underlying investment performs.
Projected vs Guaranteed Cash Value
Similar to the Death Benefit, Whole Life insurance policies will generally show two cash value columns, a guaranteed column and a non-guaranteed column. The non-guaranteed column shows the companies projection of cash value based on the current dividend amount. The non-guaranteed cash value can vary from year to year depending on the market conditions and current dividend scale. The guaranteed cash value for each given policy year is the minimum cash value that will be paid regardless of how the policies’ underlying investment performs.
Many people will wonder whether you have separate access to both the shown death benefit and the cash value and the answer is generally no. The death benefit is the amount paid on death after which the policy is no longer effect and there is no longer any cash value. Alternatively, if you cancel the policy to access the cash value, the death benefit (and policy) is no longer in effect. A more optimal method of accessing the cash value is by borrowing against the cash value rather than a full or partial cancellation. This method allows you to obtain liquidity while keeping the life insurance asset growing.
Limited Pay Options vs Premium Offset
Whole Life policies will generally have a Pay-To-Age-100 premium schedule unless you have a shortened payment schedule. The first method of structuring a shortened payment period on a permanent life insurance product is to opt for a “Limited Pay” type of whole life insurance. By opting for the “Limited Pay” option, the insurance carrier will guarantee that you no longer need to pay beyond a certain number of years, typically 20, 15, or 10 years. The second method to structure a shortened payment period is by requesting a “Premium Offset”. By requesting a “Premium Offset”, you are essentially directing the insurance company to use the cash values in the plan to continue paying the premiums. This latter method is not guaranteed though and you may need to go back to paying premiums if the underlying investment does not perform as expected.
Paid-Up Insurance vs Enhanced Insurance vs Cash
When designing your whole life insurance product, you have the option of selecting Paid-Up Additions, Enhanced Protection, or Cash. With Paid-Up Additions, the annual dividend is used to purchase more permanent life insurance, which grows both the death benefit and cash value. With Enhanced Protection, your annual dividend will be used in two ways, one is to purchase more permanent life insurance, similar to the previous option, and the second is to enhance the life insurance coverage with term life coverage. The term component will no longer be purchased when the permanent component grows sufficiently enough to catch up to the desired coverage amount. The third dividend option is to have the dividend sit in cash within the policy, typically not a popular option.
CONTACT US VANCOUVER LIFE INSURANCE COMPANY – VENTURE FIRST ADVISORY
To provide service to families in Vancouver and the rest of Canada, Venture First Advisory is located in the heart of Downtown Vancouver in the iconic Electra Building, formerly the BC Electric headquarters. The Electra building can be recognized by the unique blue and green fin lights that run the vertical height of the building. While we now do most of our business, including life insurance, by phone and/or video conference, our location is within easy access for those who work or live downtown. Contact Us as we are an experienced Vancouver life insurance advisor.