# Life insurance?



## Stephenlouis (Jun 24, 2019)

Anyone have it? Think we need it?

Ive had it for years. Just 250 k, and it was cheap( I pay my ex-wives too, as you never know, she smokes, I don't ) total was about 40 bucks a month. I just got a letter saying it expires this year, and for the same amount without the ex( she ask me to take her off lol ) it is 165 a month! When did 55 become such a liability! Just shy of a 400% increase. I guess given my age while the premium may be higher I won’t pay for nearly so long! I'll be dropping my coverage to 100k that will get me buried and my kids won't be out of pocket while the government rummages through my estate and will during probate.


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## mrmatt1972 (Apr 3, 2008)

It depends a lot on where you are in life physically and financially. I just re upped but won't again in ten years. By then the house will be almost totally paid for.


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## allthumbs56 (Jul 24, 2006)

Term policies get very expensive as you age. They are trying to collect $400,000 from you before they have to pay out that $250,000 after all. I have a 25k whole life and a 25k term that I've had for over 40 years. Every so often a new agent calls and says I need to upgrade to a minimum 100k on each as the smaller amounts aren't supported any more. I tell him to cancel them then - and somehow after a bit of fuss they manage to stick around.


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## Stephenlouis (Jun 24, 2019)

allthumbs56 said:


> Term policies get very expensive as you age. They are trying to collect $400,000 from you before they have to pay out that $250,000 after all. I have a 25k whole life and a 25k term that I've had for over 40 years. Every so often a new agent calls and says I need to upgrade to a minimum 100k on each as the smaller amounts aren't supported any more. I tell him to cancel them then - and somehow after a bit of fuss they manage to stick around.



I was told increments of 100k too, that is interesting, and I agreed to the terms.


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## KapnKrunch (Jul 13, 2016)

"When you die you get it." -- _Yogi Berra_


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## mawmow (Nov 14, 2017)

Mine is increasing every five years...
I do not need half a million $ anymore...
I should lower the amount...


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## bw66 (Dec 17, 2009)

I just renewed mine... I thought that I had renewed for the last time the last time around, but my kids aren't through school yet and my untimely death would still be a hardship for them. Like the OP, my premiums more than doubled, so I went to my financial planner and arranged for a medical assessment and got the premiums down to a much more reasonable level. If you're healthy, it's definitely worth getting the assessment and if you don't pass, you can still renew the old policy at the prescribed rate - they're not allowed to turn you down as long as you pay up within 30 days of the renewal.


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## DeeTee (Apr 16, 2018)

I have it, for the cost of our mortgage. If the worst happens, I want to know my wife at least doesn't have to worry about paying the bills.


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## Stephenlouis (Jun 24, 2019)

DeeTee said:


> I have it, for the cost of our mortgage. If the worst happens, I want to know my wife at least doesn't have to worry about paying the bills.


That's was how I started, for the mortgage, and a bit extra to carry my ex through. Now it's for the kids, to make sure I cause them no short term discomfort if I kick... not that I want to, I am a very happy man. Insurance companies don't do this because they are altruistic, so given the increased cost of my house insurance and life insurance ( both without claims LOL), they must think shit is coming down the line.


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## imyourmutter (Nov 16, 2017)

Yeah I have it. Term is the way to go, not whole (which is a big rip off). 10 times your annual income is a rough figure to shoot for in most cases for people caring for dependants, though everyone has a different situation. Gives your loved ones time to grieve and adjust and build a new life without having to stress about money right away.

I have it to provide assurance that my wife and kids will be taken care of if I die before our personal finances are in better shape. In theory the house should be paid off, the kids moved out, and a pile of cash will be in the bank at the time my policy runs out. I did the physical and because I was quite fit at the time got a great rate and so I locked in for a good chunk of time right away.

Basically my strategy with all insurances (includes warranties) is to only buy what is needed to protect me for the things that I cant self insure for. An emergency fund, paid for house, and savings in the bank can help you self insure through a lot of things. With a mortgage and dependants, I have life insurance.


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## Electraglide (Jan 24, 2010)

My death insurance has been $100K, double for accident, for 15 years. It's through my bank and the price has never changed, $34.10/month. Last time I talked to anybody was when I put in a change of address and beneficiary. It gets split between my son and the granddaughters....I hope but I won't be around to bitch if it doesn't, just as long as my 3rd ex doesn't get any.


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## Farmboyjo (Aug 26, 2016)

20+ years in the industry, though not in the way most of you are talking about.... Agree with pretty much all the comments here. I can guarantee the worst case scenario happens far more than most people think. 

If you’re on the other side of 50 and your kids are all past 20 or so, most people just need enough to pay off any mortgage and 10k-15k more for final expenses. But I’m more concerned with just straight protecting what we’ve got and not being a burden by dying...not investing and building a huge estate. YMMV obviously.


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## sambonee (Dec 20, 2007)

It’s my main occupation, life insurance. 15 years. 
-Term is like rental. (Also where They make the most profit!)
- Whole life is like ownership.(with a savings component known as cash value, which is compounding tax free from day one!) . (Whole life is where companies make the least profit)
**They both have their place

2% of term policies end up being in force when people die as it’s gone before the date of death because:
A- it becomes too costly and gets canceled before death
Or
B- the insured lives beyond 80yrs. They all end by age 80 for the most part.

Business/ corporate savings tax shelters Is my specialty.

dying without like insurance is due to:
- laziness , not doing research, having poor financial habits, avoiding the conversation for whatever reason or being unqualified due to health. 

IMO
paying $60k for 20 years to get much more than that in Benefit and having the full protection from day one has its value. And in year 20 having access to $65-80k in cash value while you’re alive is a good rainy day fund that’s all yours. 

Happy to discuss

_*Tax effective saving*_ is my brand.

good luck whatever you do.


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## StevieMac (Mar 4, 2006)

I bought into a $300K 10 yr policy when I was 43 and it was ~$30/mth. I chose that amount to cover the mortgage and some other debts at the time. When my "automatic renewal" notice arrived this May, indicating $120/mth would now be withdrawn for that same coverage, I reviewed the situation. My net worth had changed considerably in that 10 yrs and the 2X salary life insurance provided (and paid for) by my employer was more than enough to cover our mortgage and other debt.

Renewal made no sense then and I instructed the insurer to cancel. What stands out in that entire experience though is how quickly I received a call from the agent who sold me the policy. They were _very_ concerned about my decision and insisted on scheduling a meeting to review my "insurance needs". I was polite in pointing out that I had not heard from anyone at the company since signing off 10 yrs earlier and thus initiated a review of the matter myself. I had reached a final decision on my own and I was entirely comfortable with that. The "genuine concern" from the agent disappeared just as quickly as it had arrived shortly after that.


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## StevieMac (Mar 4, 2006)

sambonee said:


> dying without like insurance is due to:
> - laziness , not doing research, having poor financial habits, avoiding the conversation for whatever reason or being unqualified due to health.



You forgot two:
1) making an informed decision after thoughtfully reviewing one's entire circumstances;
2) having no $ to pay for it after covering other important expenses (shelter, food, debt, etc).


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## oldjoat (Apr 4, 2019)

last "policies" on me are getting turfed this November (everything is paid off and funeral arrangements are prepaid / arranged ) ... the ins rates just keep going UP and less coverage.
"don't you want to leave something for your family when you pass on ?"
heck , they're old enough to take care of themselves at this point .

just keeping insurance policies on each of the the kids ( accidental death) for funeral expenses .


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## allthumbs56 (Jul 24, 2006)

I'm finding a fair number of people are replacing life insurance with GoFundMe's.


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## StevieMac (Mar 4, 2006)

allthumbs56 said:


> I'm finding a fair number of people are replacing life insurance with GoFundMe's.


Hmmm. I've noticed that myself. On occasion it's left me wondering whether the GoFundMe was replacing or _in addition to_ actual insurance. No way to know really.

I find the GoFundMe phenomenon in general quite fascinating. I always recall the client of mine who started a GoFundMe campaign to help with the monthly cost (~$600) of self-prescribed cannabis to treat a self-diagnosed affliction. I was relieved actually when they reported it had failed to gain much traction. 😄


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## allthumbs56 (Jul 24, 2006)

StevieMac said:


> Hmmm. I've noticed that myself. On occasion it's left me wondering whether the GoFundMe was replacing or _in addition to_ actual insurance. No way to know really.
> 
> I find the GoFundMe phenomenon in general quite fascinating. I always recall the client of mine who started a GoFundMe campaign to help with the monthly cost (~$600) of self-prescribed cannabis to treat a self-diagnosed affliction. I was relieved actually when they reported it had failed to gain much traction. 😄


I can point to at least 6 local musicians who have passed away and friends/family have done Gofundme's and other fund raisers to "pay for the funeral and other expenses". To me that's what life insurance is for.

But then how do you pay your Telus bill and the BMW lease AND have anything left for life insurance?


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## jazzereh (Oct 25, 2016)

A somewhat short comment... life insurance in most often sold, not bought. The need for life insurance increases through to mid-life someplace but at some point, if you are managing your finances properly, you should have accumulated more financial assets and the need for life insurance declines. While I have used the life insurance package offered by my employers while working, I have been self-insured otherwise my whole life. I now have no need for life insurance. 

Without getting into the nitty gritty of needs, life insurance should be used when there is an actual 'need', that being mostly related to the amount of debt and family responsibilities. Basically I don't like how life insurance is typically sold to people who don't need it or need somewhat less than they are told they need.


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## zztomato (Nov 19, 2010)

My 10 year 300k term ends in 2021. No real need/ want to pay for more insurance at 400% higher premium.
No mortgage anymore, plenty of savings. I will not be a burden on my family. Hell, my guitar gear could be sold to cover funeral costs. 

Just ask yourself the question; if I die, will my family be ok financially? If then answer is no, maybe some insurance would be smart. If yes, why bother. Stick the money in a tfsa or rrsp.


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## imyourmutter (Nov 16, 2017)

sambonee said:


> dying without like insurance is due to:
> - laziness , not doing research, having poor financial habits, avoiding the conversation for whatever reason or being unqualified due to health.


Or being in a good enough financial situation that you don't need life insurance to care for your loved ones.


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## Judas68fr (Feb 5, 2013)

We've subscribed to one earlier this year (about a year and a half after buying our house). We scaled the amount so that it covers the mortgage and 2 years of salary. We're trying not to have any additional debt (other than the house mortgage). I have additional life insurance through my employer, and so does my spouse (3 years of salary IIRC).

The duration we went for is just slightly longer than the time left on the mortgage (20 years, vs 19.5 years). Once the house will be paid for, I'm not sure I would renew it. We're paying about $65/month for both of us (both in our 30s, healthy, non-smoker etc...).


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## Diablo (Dec 20, 2007)

Life insurance is like betting against yourself.


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## TheYanChamp (Mar 6, 2009)

sambonee said:


> It’s my main occupation, life insurance. 15 years.
> -Term is like rental. (Also where They make the most profit!)
> - Whole life is like ownership.(with a savings component known as cash value, which is compounding tax free from day one!) . (Whole life is where companies make the least profit)
> **They both have their place
> ...



Will boomers sink the industry before the next generations need it?


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## sambonee (Dec 20, 2007)

TheYanChamp said:


> Will boomers sink the industry before the next generations need it?


The reserves are all there 
And actuarial science is quite precise. 

re: betting against yourself -
I look at it as just selling a financial risk to a third party for a monthly fee. Like car insurance. (Term coverage only). Like renting.

Whole life coverage is what’s on the other side. It’s like ownership. A reverse investment. 


For a GIC to do better than a whole life policy if you live to your life expectancy , you would need to have a GIC perform between 9% and 11% return average per year after taxation.

The clients I have who spend large sums of money on permanent life insurance are those who have the following situations:

 Capital gains tax expected upon death,
Already reaching the maximum in their RSP with more money to save
own a corporation and have an excess in retained earnings that are accumulating inefficiently due to unavoidable high taxation.
the Tax free nature of the death benefit with life insurance policies is the largest legal tax opportunity in canadian tax law. I can prove it.


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## imyourmutter (Nov 16, 2017)

When insurance never looses, seems kinda hard for me to believe it when the insurance guy says whole life is the better policy. Not trying to fire shots, just saying I think there may be another side to the story.

From what I read, whole life premiums are 5-15 times that of term for the same coverage. Imagine investing that extra money across a 25yr term. That whole term you have the same coverage while you need it (let's say you are raising kids and paying down your mortgage) & you are growing a wonderful sum to use while you are still alive. After that 25 yrs your need for life insurance will be practically none with your mortgage paid and your kids raised and you will have a pile in savings. With whole life you keep on paying just to maintain that same coverage, and it is not a better investment vehicle than investments. You keep paying and with term you keep saving or using your money in other ways.

There are all types of products and services that we can take advantage of in our lives. Many of which can be helpful for different people in varying circumstances. However, one thing is drastically under-marketed to us... THE POWER OF SAVING. Saving real money gives you flexibility and stability in ways that other products never can. Sure a warranty or insurance can be helpful if you have the correct coverage for the correct period of time, but having real money saved is always the best option. We've been told that credit and loans and insurance are the way to move forward and protect us, but the very best option is to save. Use RSPs, TFSAs, mutual funds, etc. Grow real wealth and when you reach a healthy financial position you won't need so much credit or insurance or warranties. Your money in your pocket is more flexible and of more use than your money in other people's products.

I don't suspect this post will make me popular, but hopefully it helps someone. To be clear, there are wonderful and bright people who own whole life insurance rather than term. It doesn't make someone a better or worse person with either product. Just be careful to do your research and think about what makes most sense (& cents!) for your family and financial position in the long run. Run the numbers.


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## greco (Jul 15, 2007)

imyourmutter said:


> When insurance never looses, seems kinda hard for me to believe it when the insurance guy says whole life is the better policy. Not trying to fire shots, just saying I think there may be another side to the story.
> 
> From what I read, whole life premiums are 5-15 times that of term for the same coverage. Imagine investing that extra money across a 25yr term. That whole term you have the same coverage while you need it (let's say you are raising kids and paying down your mortgage) & you are growing a wonderful sum to use while you are still alive. After that 25 yrs your need for life insurance will be practically none with your mortgage paid and your kids raised and you will have a pile in savings. With whole life you keep on paying just to maintain that same coverage, and it is not a better investment vehicle than investments. You keep paying and with term you keep saving or using your money in other ways.
> 
> ...



Well written and virtually the approach I took.


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## Electraglide (Jan 24, 2010)

Diablo said:


> Life insurance is like betting against yourself.


Only if you're betting that you're going to live. That's why I have 'death' insurance. I die and my son gets some money.


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## sambonee (Dec 20, 2007)

Whole life premiums are offset in yr20 and have increased more that your accumulated deposits in year 20. And all the growth is tax free and you can access the cash while you’re alive.
It’s literally all I’ve done for15 years. The numbers don’t lie. When you compare apples to apples your investments would have to average 9-11% to keep up +

you never risk loosing money. Cash value is Guaranteed to never reduce.
Both term and whole life have their place.


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## brucew (Dec 30, 2017)

Had life ins when our kids were young, we we're up to our necks in debt. My laymans advice, stick to term ins. You're betting the ins co you're going to die, they're betting you you're not. Cover your debts plus enough to get you're family back on their feet after your passing.
Again, just my laymans advice.


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## Diablo (Dec 20, 2007)

Electraglide said:


> Only if you're betting that you're going to live. That's why I have 'death' insurance. I die and my son gets some money.


when I said it, it was a double aunt Andre.
1) that I’m going to live a long time
2) that I can take the same amount of money I would pay for insurance premiums, invest it, and do at least as well with it, without putting anyone through the hassle of collecting on a claim from an insurance company.

the way I see it, insurance companies stay in business the same way casinos do. The odds are always stacked in their favour.

that said, I have the luxrug that my wife makes a good income as well, so no matter what happens, either one of us will be fine, after a change in living standards. Ymmv.


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## imyourmutter (Nov 16, 2017)

I got curious about actual numbers of term vs whole life and called an insurance broker. It's pretty fascinating really. If it interests anybody I can write out the numbers of what it would cost me to carry term vs whole vs a hybrid and show the $ comparison of how much you pay in vs what the benefits are projected to be. Let me know. I'm waiting on a few final numbers, but what I can tell so far is it is quite the interesting comparison when converted to Apples Vs Apples as opposed to the Apples Vs Orange that they present to you (which is tougher to make a real good decision on).


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## StevieMac (Mar 4, 2006)

imyourmutter said:


> I got curious about actual numbers of term vs whole life and called an insurance broker. It's pretty fascinating really. If it interests anybody I can write out the numbers of what it would cost me to carry term vs whole vs a hybrid and show the $ comparison of how much you pay in vs what the benefits are projected to be. Let me know. I'm waiting on a few final numbers, but what I can tell so far is it is quite the interesting comparison when converted to Apples Vs Apples as opposed to the Apples Vs Orange that they present to you (which is tougher to make a real good decision on).



I'd be interested in hearing an objective viewpoint if that's what you're proposing...


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## Chitmo (Sep 2, 2013)

Just some food for thought, but paying for life insurance for an elderly family member had a 10x better return on investment than most RRSPs.


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## Electraglide (Jan 24, 2010)

Chitmo said:


> Just some food for thought, but paying for life insurance for an elderly family member had a 10x better return on investment than most RRSPs.


Should work with ex wives too.


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## imyourmutter (Nov 16, 2017)

StevieMac said:


> I'd be interested in hearing an objective viewpoint if that's what you're proposing...


I'll do my best to do so when the final info/quotes I'm waiting on come in. I will say it seems the Insurance agent is biased towards whole life (in some form) and I would say up until my conversation I was definitely biased towards term. I will try to provide an objective view based on the numbers and features.


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## Stephenlouis (Jun 24, 2019)

Electraglide said:


> Should work with ex wives too.


I paid her's for 13 years, no return. Really did lol


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## sambonee (Dec 20, 2007)

I studied under top 5 veteran agent in Canada. Specialist in whole life. Term is for short needs, and when cash is tight. WL is for a need/want that will be present until the end. Best value is WL. so many ways to show it too. Mainly the tax exemptions are the “secret sauce”


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## Ship of fools (Nov 17, 2007)

For me there is no point as I am uninsurable do to my signing with the M.A.I.D. program. However my wife did the whole insurance just to make sure the kids were not left with any problems for her passing and in 5 years her life insurance can start to pay for itself.
My life insurance payed out when I reached 65 so we are fine no matter what happens.


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