Life Insurance

May 22 2025

What Happens if I Outlive My Term Life Insurance?

Pat McIver Life Insurance Life Insurance

Unlike permanent life insurance, term life insurance only lasts for a pre-set period, usually 10, 20 or 30 years.

If you die within that period, your beneficiaries receive a death benefit.

However, if you outlive your term life insurance policy, the policy expires, and you receive nothing. That is, unless you had opted for specific riders, such as a return of premium rider or a conversion rider.

Let’s explore these insurance riders and more to help you decide your best course of action.

Understanding Term Life Insurance

Nearly 90%, or over 22 million Canadians, have some type of life insurance policy, with term life insurance being the most popular type in Canada.

This is because term life insurance is affordable, straightforward, and tailored to financially protect your beneficiaries during the years of your life when financial protection matters most.

Term life insurance is ideal for young families with kids, mortgages, or other big expenses, who need insurance only for a limited time (usually until they are close to retiring or their kids have grown up).

But what happens if your term life insurance policy expires or is close to expiring? What options do you have if you require further coverage? And are there ways to still get money back even if you outlive your term?

What Happens if You Reach the End of Your Term Life Insurance?

When your term life insurance reaches the end of its 10, 20, or 30-year term, the policy automatically expires unless you take steps to renew or convert it (which should be done at least a year before expiration).

To find the exact end date of your life insurance term, contact your insurance provider or look at your policy documentation.

Your coverage will end on the specified date, at which point you and your loved ones will no longer be protected under that policy.

Insurers will usually send a notice a year before your term is set to end, offering options like:

Renewing the policy annually (often at a much higher rate)
Converting to a permanent life policy (if your original policy included a conversion rider)

If no action is taken, the policy simply ends, and that’s it. No payout is received, and you don’t need to do anything from your end.

However, if you feel you still require coverage because of lingering debts or dependents who rely on your income, you can explore the following options:

Extend Coverage Annually

Many term life insurance policies offer a guaranteed renewability provision that allows you to automatically extend your coverage annually for as long as you want on adjusted premium rates.

Premiums increase year over year as you age, which can become expensive. However, as you already have an existing policy, you won’t need to submit a medical exam or any further documentation for continued coverage for as long as you need it.

You could also shop around for a new policy, especially if you are in good health. You never know, you could always find a policy with better terms than those offered by your current provider.

Convert to a Permanent Life Insurance Policy

If you opted for a conversion rider at the start of your term life insurance policy, you would be eligible to convert your current term life insurance to a permanent or whole life insurance policy without the need for a medical exam.

Permanent life insurance offers lifetime coverage with no expiry date. However, this coverage has higher premiums compared to term life insurance, as payouts are guaranteed.

Top Tip:
To get around the premium hike, you can ask to lower the coverage amount or the death benefit of your new permanent life insurance policy. This way, your premiums remain about the same, and your beneficiaries are guaranteed a payout (be it a smaller amount).

Permanent life insurance policies offer additional benefits as well, including a cash value component, which acts as tax-deferred savings which can come in handy during retirement, used as collateral for loans, or withdrawn to pay for emergencies should they arise.

This type of policy can also play an instrumental role in wealth transfer and estate planning. The payout can help cover estate taxes, leave a legacy for your children, or fund a trust or charitable organization.

Opt for a Return of Premium Rider

Insurance providers usually offer a range of riders that can be added to your policy. Some of the most common and popular riders include:

Accidental death benefit: This rider allows your beneficiaries to get an additional payout on top of the existing death benefit were you to die in an accident.
Waiver of premium rider: If you were to become disabled, this rider allows you to stop paying your premiums while keeping your policy active.
Return of premium rider: If you outlive your term, this rider allows you to get back all the premiums you paid tax-free.
Critical illness rider: This rider allows for a lump sum payout should you be diagnosed with a serious or chronic illness.
Conversion rider: Lets you convert from a term life insurance to a permanent life insurance policy later on without the need for a medical exam.
Child term rider: Lets you add life insurance for your current and future children.
Guaranteed insurability rider: Allows you to increase your coverage amount at a future date without the need for health checks or medical exams.

The inclusion of riders or optional features can provide added protection for those with specific needs.

The return of premium rider, for example, allows you to get 50%-100% of the premiums you paid, if you’re still alive when the policy ends. This “refund” is also tax-free. While the total amount will be far lower than the death benefit, at least all of those premium payments you made won’t seem like a waste.

A return of premium rider can only be added to a term life insurance policy when you first purchase it. This is why it pays to consult with a trusted and reputable insurance broker before making a buying decision or before your policy ends.

Halifax’s Most Trusted Insurance Broker Near Me

Everyone’s financial needs are unique. Thus, making sure you get the right policy for you, with the right coverage, and at the right price, requires the help of professionals.

At McIver Insurance Inc., we specialize in group benefits, life insurance, and health insurance for Nova Scotian families and businesses. We have a 5-star Google Rating and incredible testimonials from clients we have served in the past.

Call Pat Now at 1-902-220-3279 or click here to book a free, no-obligation meeting with Pat McIver, BRM, CEBS.

FAQs

Q1) What are the benefits of converting term life to permanent insurance?

Benefits include lifetime coverage, a tax-free savings component, and smoother wealth transfer and estate planning.

Q2) How do I calculate the cost-effectiveness of renewing term life insurance?

Compare the renewal cost of your current policy to the cost and value of other available options, like buying a new term policy or switching to permanent life insurance.

Q3) Can I buy a new term life insurance policy after my current one expires?

Yes, you can. As long as you meet age and health requirements and are comfortable taking a medical exam, you can apply for a new term life insurance policy once your current one expires.

Q4) What should I consider when my term life insurance is nearing its end?

This is the perfect time for you to reassess your financial needs and ask yourself whether you still need insurance or not. If you do, then you should consider options like renewing your current policy, buying a new policy, converting your term policy to a permanent one (if applicable), or talking to a licensed and trusted insurance advisor.

April 25 2025

Sleep Apnea & Life Insurance

Pat McIver Life Insurance Life Insurance, Sleep Apnea

Key Takeaways

Sleep apnea’s severity and management can significantly impact life insurance rates.
Insurers classify sleep apnea as a pre-existing condition, hence influencing eligibility and premium costs.
Options like guaranteed acceptance life insurance may be available for severe cases.

According to the NIH, in 2024, an estimated 5.4 million Canadians were diagnosed with sleep apnea, with this number expected to increase in the coming years.

But what is sleep apnea, and how can it impact your ability to get life insurance?

Let’s find out!

Sleep Apnea and Its Impact on Life Insurance

Sleep apnea is a common but often misunderstood condition.

Simply put, sleep apnea is a sleep-related breathing disorder where breathing repeatedly stops and restarts during sleep, resulting in sleep disruption, loud snoring, and poor ventilation.

There are also three main types of sleep apnea.

Obstructive Sleep Apnea (OSA)

The most common type of sleep apnea. OSA occurs due to airway blockages caused by soft tissues in the throat collapsing during sleep.

Central Sleep Apnea (CSA)

Caused by the brain failing to signal the throat muscles to breathe due to complications in the respiratory control center.

Complex Sleep Apnea Syndrome (CompSAS)

This much rarer form of sleep apnea is a combination of both OSA and CSA, making it much harder to treat.

If left untreated, these can lead to serious health problems like high blood pressure, heart disease, and diabetes.

If you’ve been diagnosed with sleep apnea, it’ll likely affect your life insurance premiums or even your ability to get coverage at all.

But don’t despair.

You can qualify for affordable options with the right management plan.

Here’s how.

Managing Sleep Apnea to Improve Insurance Options

Sleep apnea doesn’t have to be a dealbreaker. By learning to manage it well, you can open doors to much better insurance options.

Here are some common tips to follow that can make a big difference:

Use a CPAP machine every night, or as prescribed
Quit smoking and alcohol
Lose weight, if needed
Stay on top of other health issues like high blood pressure

Ensuring sleep apnea symptoms are manageable and in control can help lower the perceived risk of sleep apnea to a life insurance provider, resulting in lower premium rates and better coverage terms. It will also result in improved sleep and a better quality of life.

The Impact of Sleep Apnea Severity on Insurance Premiums

Insurers don’t look at sleep apnea as a one-size-fits-all condition. Risk is assessed based on whether your sleep apnea is mild, moderate, or severe.

Mild sleep apnea

Often qualify for standard or even preferred rates if symptoms are well-managed and there are no related complications.

Moderate sleep apnea

If your condition is moderate but manageable, premiums are higher but not overly expensive.

Severe sleep apnea

In more severe cases, where sleep apnea is left untreated or poorly managed, insurance providers may offer much higher premiums or even decline applications.

Insurance Underwriting Process for Sleep Apnea Patients

When you apply for life insurance, the insurer sends your case to the underwriting team. This is where they decide your risk level to determine premium rates.

For individuals living with sleep apnea, underwriters will require specific information, such as:

The severity of your condition (based on your sleep study results)
The type of sleep apnea you have been diagnosed with
Whether you use a CPAP machine or other forms of treatment
Any complications or related illnesses
Frequency of doctor visits
Family medical history

Some insurers will even treat a case more favourably if the applicant can prove consistent CPAP usage by sending in data from their machine’s data log.

Disclosure and Documentation of Sleep Apnea in Insurance Applications

Full disclosure about your sleep apnea is essential when applying for life insurance.

If you try to hide your condition and your insurer finds out later, your policy will most likely be cancelled, or your beneficiaries will be denied any death benefit.

When applying for life insurance with sleep apnea, you’ll most likely have to provide the following documents:

A recent sleep study report (polysomnography)
Doctor’s notes showing diagnosis and treatment plan
Proof of CPAP compliance, if that’s part of your treatment
Info on related health issues like high blood pressure or diabetes
Family medical history (if needed)

Insurers require these documents to understand the full extent of your condition. The more evidence you can provide to support your condition management, the better your odds of getting competitive premiums and favourable terms.

Types of Life Insurance Available to Individuals with Sleep Apnea

Individuals with sleep apnea have access to the same type of life insurance policies as everyone else.

In Canada, the two most common types of life insurance policies include:

Term life insurance – Offers coverage for a set period (e.g., 10, 20, or 30 years). It’s usually the most affordable option.
Permanent life insurance – Covers you for life and builds cash value over time at the cost of higher premiums.

However, if you are living with severe sleep apnea and have been denied coverage for regular policies, you do have other options.

Some insurance providers offer Guaranteed Acceptance Life Insurance. This type of policy requires no medical exam, but offers lower coverage amounts and higher premium costs.

You could also be eligible for a Simplified Issue Life Insurance policy that requires a short health questionnaire to be filled out, but no medical exam. These policies offer higher coverage amounts, quicker approval, and more features, but are also more expensive than standard term policies.

Challenges and Considerations in Insuring Sleep Apnea Patients

The biggest challenge when it comes to insuring sleep apnea patients is assessing the severity of the condition.

If you can’t prove that your condition is being controlled or managed properly, most insurers will charge higher premiums or deny coverage altogether.

Luckily, modern technology has made sleep apnea management easier to track. Insurance providers are a lot more open to offering life insurance to sleep apnea patients who use CPAP machines and utilize wearable devices and apps to measure sleep quality and overall health.

Legal and Regulatory Aspects of Insuring Sleep Apnea

In Canada, you’re protected by privacy laws that keep your medical information confidential. Insurers can only request what’s necessary to assess your risk.

That said, if sleep apnea puts you at higher risk for other conditions, insurers have a legal right to factor that into your premiums. Provincial regulations (like those in Nova Scotia) ensure fair underwriting practices, but they don’t prevent higher premiums based on health status.

Luckily, many insurance companies are realizing that well-managed sleep apnea cases shouldn’t be penalized, and as such, getting life insurance while living with sleep apnea has become more plausible than ever before.

Buying Life Insurance as a Sleep Apnea Patient

Sleep apnea in Nova Scotia is more common than you think. While getting life insurance may seem tricky and out of reach, it’s far from impossible.

The key is proper management, full disclosure, and working with a trusted insurance broker who understands how to navigate the system.

At McIver Insurance Inc., we’ve helped plenty of Nova Scotian breadwinners living with sleep apnea and pre-existing medical conditions get the coverage their family needs at affordable premiums.

Call Pat at 1-902-220-3279 to get your family the financial protection they deserve!

FAQ Section

Q) What is sleep apnea, and why does it affect life insurance rates?

Sleep apnea is a medical condition where breathing stops during sleep, resulting in serious health problems. Insurers see this as a risk, especially if it isn’t well managed, resulting in higher premiums and even coverage denial.

Q) What types of life insurance are available to someone with sleep apnea?

All types of life insurance policies are available for those living with sleep apnea. However, guaranteed or simplified issue policies may be better for those with severe or untreated conditions.

Q) How do I manage my sleep apnea to qualify for better insurance rates?

Use your CPAP machine regularly, maintain a healthy lifestyle, keep on top of your doctor appointments, and keep all your medical documentation organized for better rates and coverage terms.

March 20 2025

Life Insurance After a Heart Attack

Pat McIver Health Insurance, Life Insurance Heart Attack, Life Insurance

According to Statistics Canada, heart attacks or strokes are the second leading cause of death in Canada, accounting for over 53,000 deaths per year.

The worrying part about heart disease is that it rarely shows any symptoms until it’s too late. This is why heart attacks have such high fatality rates and why insurers consider it “high risk”.

Having a heart attack can be jolting. It makes you think about how short life can be and the importance of having some form of financial protection for your loved ones.

For many, a heart attack is a wake-up call – a second chance at life. Thus, it isn’t uncommon for individuals to seek life insurance options shortly after recovery.

But can having a heart attack impact your ability to get life insurance?

In a way, yes.

Depending on your condition, finding a policy can be difficult and often expensive. But, while a heart attack changes things, it doesn’t mean you’re out of options.

Here’s how you can get life insurance to protect your loved ones even after a heart attack!

Heart Attack & Strokes – Signs & Symptoms

A heart attack or stroke occurs when blood flow to your heart is restricted, usually due to a build-up of plaque (fatty deposits) within your coronary arteries.

Without the flow of oxygen-rich blood, your heart muscles begin to lose steam, resulting in a heart attack.

Heart attacks are also notorious for occurring without warning. Symptoms and signs usually manifest minutes before an attack, leaving little time to get help.

The most common signs of an impending heart attack include:

Chest pain (you will feel pressure or pain in your chest)
Excessive sweating
Pain in your arms, back, neck, shoulders and jaw
Shortness of breath
Nausea
Dizziness

How a Heart Attack Affects Life Insurance

There are usually two reasons why you could have had a heart attack.

You have a family history of heart disease
You have unhealthy habits that are putting a strain on your heart

Even those who have a family history of heart disease can avoid having a heart attack by making lifestyle adjustments, such as eating healthy, exercising, and refraining from smoking and drinking.

In most cases, then, a heart attack occurs because of poor lifestyle choices. Obesity, smoking, excessive drinking, and zero exercise are the leading factors behind heart disease, and insurers know this.

That’s why when you have a heart attack, you raise the brows of insurance providers everywhere. They automatically see you as a higher risk and that means they’ll take a much closer look at your medical history, lifestyle, and overall health before approving your policy.

The severity of your heart attack, how well you’ve recovered, and whether you’ve made healthy lifestyle adjustments will all play a role in determining your eligibility and premium rates.

Here are three key factors that insurers use to assess eligibility and premium rates after a heart attack:

Medical Underwriting: A heart attack signals underlying cardiovascular disease, which means more in-depth medical evaluations. Insurers will want details on your diagnosis, treatment, medications, and follow-up care.
Risk Assessment: Your insurer will evaluate your heart health, lifestyle habits, and any related conditions (like diabetes or high blood pressure) to determine your health risk level.
Premium Adjustments: Increased risk will result in higher premiums. However, improvements in your health over time could help you qualify for better rates down the line.

Types of Life Insurance Available After a Heart Attack

In Canada, you are eligible for life insurance even after a heart attack. However, finding the right policy can depend on your health status, budget, and financial goals.

Here are the main types of policies you can consider:

Term Life Insurance

If you’re in relatively good health post-heart attack, you may still qualify for term life insurance, which offers coverage for a set period (like 10, 20, or 30 years). It’s usually the most affordable option but comes with the risk of needing to reapply when the term ends.

Whole Life Insurance

This option provides lifelong coverage and builds cash value over time. While premiums are higher than term life insurance, they remain fixed, which can be beneficial if you want long-term protection.

Guaranteed Acceptance Life Insurance

If you’ve been denied other policies, guaranteed acceptance life insurance may be your only choice. It requires no medical exam and has minimal health questions, but premiums are a lot higher, and coverage amounts are usually lower than other types of policies.

What Impacts Your Life Insurance Rates After a Heart Attack?

Several factors influence your life insurance rates, including:

Age and Medical Condition: The younger and healthier you are post-heart attack, the better your chances of securing an affordable policy. Insurers look at your overall health, not just your heart attack history.

Smoking Status: Smoking increases your risk of another heart attack, making you a higher-risk applicant. If you quit, you may qualify for lower premiums after a certain period.

Family Medical History: Genetics play a role in heart disease. If you have a family history of heart conditions, insurers may factor this into their risk assessment.

The Life Insurance Application Process After a Heart Attack

Applying for life insurance post-heart attack involves a more detailed underwriting process.

Here’s what to expect:

You’ll need to provide your full medical history, including details about your heart attack, medications, and follow-up treatments.
Insurers may ask for medical records, stress test results, echocardiograms, and cardiologist reports to assess your heart health.
The underwriting process may take longer than usual—typically 4 to 8 weeks—depending on the complexity of your medical history.

How to Get the Best Life Insurance Rates After a Heart Attack

Even with a history of heart disease, you can still take steps to secure the best possible coverage and premiums:

Improve Your Health: Engaging in cardiac rehab, maintaining a heart-healthy diet, exercising, and managing stress can positively impact your health and insurance rates.
Adjust Coverage Based on Budget: If premiums are high, consider adjusting the coverage amount or term length to find a balance between affordability and protection.
Work with an Insurance Broker: An insurance broker can help you compare multiple policies and find insurers that specialize in covering people with pre-existing conditions like heart disease.

Preparing for the Future: Long-Term Life Insurance Considerations

Once you’ve secured a policy, it’s important to periodically review and update it to ensure it meets your evolving needs.

As your health improves or your financial situation changes, reassess your coverage to ensure it still provides the protection you need.

Also, consider how your life insurance fits into your broader financial plan, including wills, trusts, and inheritance or estate planning.

Finally, ensure your loved ones understand your policy and how to access benefits when needed.

FAQs

Q1) Can I get life insurance after a heart attack?

Yes, but it depends on the severity of your heart attack, your overall health, and the type of policy you apply for.

Q2) What type of life insurance is best after a heart attack?

It depends on what you are looking for. Term life insurance is the most affordable option, whole life offers lifelong protection, and guaranteed acceptance policies provide lower coverage without a medical exam.

Q3) How does a heart attack affect my life insurance premiums?

Insurers see a heart attack as a risk factor, so premiums will likely be higher. However, maintaining good health can improve your rates over time.

Q4) What can I do to lower my premiums after a heart attack?

Quit smoking, manage your weight, exercise, follow your doctor’s recommendations, and work with an insurance broker to find the best policy.

Q5) How often should I review my life insurance policy after a heart attack?

At least every couple of years or after major life changes like improved health, marriage, or changes in financial goals.

Getting Life Insurance After A Heart Attack

Acquiring life insurance after a heart attack can be challenging.

But it doesn’t have to be.

With a trusted insurance broker like McIver Insurance Inc. by your side, finding the right coverage can be easier than you think.

We specialize in helping Nova Scotians with chronic illnesses find life insurance policies that give them much-needed peace of mind.

March 20 2025

Crohn’s Disease and Life Insurance: What You Need to Know

Pat McIver Life Insurance Crohn's Disease, Life Insurance

According to Crohn’s and Colitis Canada, about 1 in 140 people live with Crohn’s or ulcerative colitis. That’s more than 300,000 Canadians, and this number is rising year on year.

If you have been recently diagnosed with Crohn’s or know someone who has, you are likely wondering, will this impact life insurance?

In a word, yes.

However, having Crohn’s doesn’t mean you can’t get life insurance.

While insurance companies may see it as a health risk, plenty of insurance providers will still grant life insurance to those diagnosed with Crohn’s, be it at higher premiums.

Here’s everything you need to know about Crohn’s and life insurance.

Understanding Crohn’s Disease

Crohn’s disease falls under the same category as ulcerative colitis and inflammatory bowel disease (IBD). Essentially, it is a chronic illness that affects your digestive tract, that runs from your mouth to your anus.

Symptoms can include abdominal pain, diarrhea, fatigue, weight loss, and even complications that require surgery.

Crohn’s disease is also often unpredictable. Some may only experience mild symptoms, while others can experience severe flare-ups that require hospitalization.

In many instances, through proper treatment and care, those diagnosed with Crohn’s disease can live a normal, healthy life.

How Crohn’s Affects Life Insurance Eligibility?

As Crohn’s is a lifelong disease that has no cure to date, insurance companies will often require detailed accounts of your medical history.

If your symptoms are well-managed and you’ve gone long periods without major flare-ups, your chances of getting approved at standard rates or slightly higher premiums is actually quite high.

However, if you were diagnosed at a young age, have required frequent hospitalizations, or depend on strong medications for symptom management, insurers might deny coverage or offer it at ridiculously high premiums.

So, while those with mild to moderate conditions are eligible for life insurance, those with severe cases may be denied coverage, especially if they recently underwent surgery.

Lifestyle habits can also play a role when it comes to eligibility and premiums. If you smoke, have other medical conditions, or struggle with obesity, you could be denied coverage altogether.

The Insurance Underwriting Process for Crohn’s Patients

If you have Crohn’s, expect your life insurance application to go through medical underwriting.

Underwriting is a complicated mathematical process that actuaries use to assess risk and decide on coverage and rates.

For Crohn’s patients, the underwriting process can often be even more complicated than usual. Patients may need to fill out detailed questionnaires about their medical history, provide doctor’s records, undergo medical exams, and even provide lab work to assess overall health.

Depending on how stable your condition is, you could qualify for a standard policy with regular rates (best case scenario), a policy with higher premiums, or a no-medical exam policy that skips health tests but costs more.

It is important to remember that every insurer evaluates risk differently, so shopping around is often the key to finding the right policy.

The Challenges of Getting Life Insurance with Crohn’s

Let’s be honest. Securing life insurance whilst being diagnosed with Crohn’s isn’t easy.

Many Canadians often run into roadblocks like higher premiums, exclusions for Crohn’s-related complications, or even outright denials.

It can feel frustrating and unfair, especially when you’re doing everything possible to manage your health and protect your loved ones.

Don’t get discouraged!

While challenging, it is still possible to get life insurance with pre-existing medical conditions.

The key is to find a provider or insurance broker who understands Crohn’s and works with you to find a fair policy that suits your budget and needs.

Insurance Options for those Diagnosed with Crohn’s

Traditional Life Insurance – If your Crohn’s is well-controlled, you could qualify for standard coverage with competitive rates.
No-Medical Exam Insurance – Ideal for those who want to skip medical tests but expect to pay higher premiums.
Guaranteed Issue Insurance – This option doesn’t require health questions or medical exams but comes with higher costs and lower payouts.
Critical Illness Insurance – This type of coverage pays a lump sum if your Crohn’s leads to severe complications.

The Power of Insurance Riders

Crohn’s is an unpredictable disease. You may have mild to no symptoms for months or even years, only to have a severe flare-up that could result in hospitalization and even surgery.

Thus, if you are considering life insurance at a time where your symptoms are well-managed, find a policy with the following insurance riders.

Waiver of Premium Rider – If you become unable to work due to your illness, this keeps your policy active without payments.
Accelerated Death Benefit Rider – This allows you to access part of your life insurance payout if you develop a terminal condition.

How to Get the Best Coverage?

Finding the right insurance when you have Crohn’s requires a bit of strategy.

Here are some ways to improve your chances of getting approved at a reasonable rate:

Work with an Insurance Broker – A broker can compare different insurers to find the best policy for you.
Maintain Good Health – Managing stress, eating well, and exercising can sometimes lead to better premiums.
Be Honest About Your Health – Hiding details about your Crohn’s can lead to denied claims later.
Compare Policies – Every insurer evaluates Crohn’s differently, so don’t settle for the first offer.

It is important to note that most Canadian life insurance companies, such as Manulife, Canada Life, SSQ Life Insurance, Assumption Life, Empire Life, and more, offer life insurance for those diagnosed with Crohn’s disease. Canadian Pension Plan or Assumption Life also offer no medical life insurance policies for Crohn’s patients.

You just need to shop around to find the best deal!

FAQs About Life Insurance and Crohn’s Disease

Q1) What is the best life insurance policy for someone with Crohn’s?

It depends on your health and budget. If your Crohn’s is mild, you might qualify for a standard policy. If it’s more severe, a no-medical or guaranteed issue policy might be a better fit.

Q2) How does Crohn’s disease affect life insurance premiums?

Premiums are based on risk. If your symptoms are well-managed, you’ll likely pay less. However, if you experience frequent flare-ups, have had surgery, or require hospitalization, premiums can be much higher.

Q3) What should I disclose about my Crohn’s disease when applying for life insurance?

Everything! This includes when you were diagnosed, your symptoms, medications, and any hospitalizations. Being honest helps avoid issues later.

Q4) Can I be denied life insurance based on my Crohn’s disease?

Yes, but it depends on the insurer. Some companies decline severe cases, while others offer alternative policies. An insurance broker can help you find the right fit.

Q5) Are there any specific riders that are beneficial for Crohn’s patients?

Waiver of premium and accelerated death benefit riders can be helpful additions to your policy as they provide financial security if your condition worsens.

Trusted Life Insurance Broker Near Me!

Being diagnosed with Crohn’s can be stressful and unnerving, especially if you have dependents.

But it doesn’t have to be.

With the right information, guidance, and persistence, you can find a policy that protects your loved one’s financial future.

At McIver Insurance Inc., we’re here to help Nova Scotians living with Crohn’s find the right life insurance coverage.

February 20 2025

Life Insurance and Alcoholism – Key Factors

Pat McIver Life Insurance Alcoholism, Life Insurance

So, you’ve had a few wild nights, maybe even a few wild years, and now you’re wondering how that might affect your life insurance?

Fair question.

Insurance companies take alcohol history seriously, and it can impact your rates—or even whether you get a policy at all.

But don’t worry, if you’re on the path to recovery, there’s hope (and decent insurance options) ahead.

Impact of Sobriety Duration on Life Insurance

When it comes to getting life insurance after a history of alcoholism, time is your best friend.

Most insurers want to see at least two to five years of sobriety before they even think about giving you a break on premiums.

Why?

Because relapse is common in the early years, and insurers like playing it safe.

But the longer you stay sober, the better your chances.

After five years, some companies may even offer standard or preferred rates—which means you’re paying about the same as someone who never had a drinking problem.

It’s a bit like getting off Santa’s naughty list: stay good long enough, and you’re back in the clear.

Underwriting Challenges for Recovering Alcoholics

If you’ve ever had to explain your internet search history, you know the feeling of having someone dig into your past.

Insurance companies do this with alcohol use, too.

They’ll look at your drinking patterns, rehab history, and any health issues tied to alcohol.

Things like DUIs, liver damage, or high blood pressure can make getting coverage trickier.

Common Health Complications Considered:

Liver disease: If your liver’s taken a beating, expect higher premiums or a policy denial.
Heart problems: Alcohol and heart disease go hand in hand, and insurers know it.
Mental health issues: Anxiety and depression are often linked to alcoholism and can factor into your risk level.

Even if you’ve been sober for years, any lasting health issues can still impact your policy rates.

So, while your drinking days might be behind you, your liver might still be holding a grudge.

Insurance Policy Variations and Alcohol History

Not all drinking histories are created equal. Some insurers might look at you like a risky bet, while others are more forgiving.

Here’s a general breakdown:

Alcohol History	Impact on Life Insurance
No History of Alcoholism	Standard or Preferred Rates
Minor Past Alcohol Use	Standard Rates
5+ Years of Sobriety	Possible Standard or Slightly Higher Rates
Under 5 Years of Sobriety	High Premiums or Limited Policy Options
Ongoing Alcohol Abuse	High Chances of Policy Denial

Medical Assessments and Disclosure Requirements

This is where honesty really matters.

Insurance companies will ask about your alcohol use, and lying about it can backfire big time.

If they find out later (and they will), they can cancel your policy, refuse to pay out, or slap you with fraud allegations.

When applying for life insurance you might even have to undergo medical exams which will likely include liver function tests, blood pressure checks, and general screenings to see how much damage, if any, has been done.

If you’ve been staying healthy and sober, your results might help convince insurers to give you a fair rate.

Financial and Emotional Consequences of Policy Denial

Getting denied life insurance because of past alcoholism isn’t just frustrating—it can be a financial headache.

Without a policy, your loved ones could be left without support if something happens to you.

But all is not lost.

There are guaranteed issue life insurance policies, which don’t require a medical exam (but do have higher premiums).

Employer-sponsored group life insurance can also be an option if your workplace offers it.

Role of Support Systems in Maintaining Sobriety

Insurance companies love stability.

If you’re part of Alcoholics Anonymous (AA) or another support group, it shows insurers that you’re serious about staying sober.

Some companies might even take that into consideration when determining your risk level.

Your support system matters, too. Family, friends, and community can make a huge difference in preventing relapse.

And hey, the fewer stressors in your life, the less likely you’ll be tempted to go back to old habits.

Legal and Ethical Considerations in Insurance for Alcoholics

In Canada, insurance companies have to follow certain rules when evaluating applicants with a history of alcoholism.

They can assess risk, but they can’t outright discriminate.

If you feel like you’ve been unfairly denied or overcharged, you can challenge the decision or work with an insurance broker to find a better option.

FAQ Section

Q) What is the minimum sobriety period required by most insurers?

Most insurers require at least two to five years of sobriety before offering standard rates.

Q) How does past alcohol use affect life insurance rates and eligibility?

A history of alcoholism can lead to higher premiums or policy denial, depending on sobriety duration and health conditions.

Q) What are the options if I am denied life insurance due to my alcoholism history?

Alternatives include guaranteed issue life insurance and group life insurance through an employer.

Q) Can participating in an alcohol support group help improve my insurance options?

Yes, insurers may view participation in rehab programs and support groups as positive indicators of stable recovery.

Q) What legal protections do I have when applying for life insurance with a history of alcoholism?

Canadian human rights laws prohibit discrimination based on addiction, including alcoholism. They are also legally obligated to assess risk based on current health conditions and sobriety duration rather than past history.

Find The Right Life Insurance Policy for Your Lifestyle

Having a history of alcoholism doesn’t mean you’re out of luck when it comes to life insurance.

By staying sober, taking care of your health, and shopping around for an insurance provider that’s willing to work with you there is no reason you can’t find a policy to protect your loved ones.

At McIver Insurance Inc., we specialize in helping Nova Scotians find the right life insurance coverage for their family needs, no matter their past.

Have further questions? Let’s chat. We promise no judgment, just solid advice. Call now to learn more.

January 16 2025

Life Insurance for Newlyweds

Pat McIver Life Insurance Life Insurance

Congratulations on your recent marriage and kudos for considering securing your financial future together as a couple!

By searching “life insurance for newlyweds” or “why life insurance is important for newlyweds” you have taken the most practical first step you can take to ensure long-term financial security and much-needed peace of mind.

Life insurance has always been the cornerstone of smart financial planning for couples and here is everything you need to know to get started.

Life Insurance Basics for Newlyweds

Marriage is the start of a new adventure, one that you won’t be on solo.

Planning for two and possibly more (if you decide to have children) can bring with it new responsibilities, challenges, and goals.

Getting life insurance early as newlyweds can provide a strong foundation to help you both grow and can provide a safety net for unforeseen events or curveballs that life might throw your way.

In Canada, as a married couple, you can opt for either a separate or joint life insurance policy. Each policy has its own set of benefits and drawbacks which we will get into shortly.

But, before we do, let’s look at the two most common types of life insurance policies in Canada:

Term Life Insurance

By far, it is the most popular, affordable, and straightforward policy available to newlyweds.

This policy provides coverage for a set period, usually 10 or 20 years and automatically renews at the end of the term until finally expiring on your 80th birthday.

Premiums for this type of policy are locked in for the term. However, during renewal, you can expect an increase in premiums based on age and other factors.

Term life insurance is often perfect for couples who have shorter-term financial responsibilities, and are looking for a mixture of affordability and flexibility.

Permanent Life Insurance

As the name suggests this type of policy offers lifetime coverage. There are no renewals or changes in premium costs as coverage never expires and premiums are guaranteed never to change.

While more expensive than term policies, this type of life insurance coverage can act as a long-term investment as it allows the policyholder to build cash value over time.

This cash value can be used as collateral to acquire low-interest loans or cashed out to cover expenses for emergencies.

Essentially this type of policy offers a living benefit along with a death benefit which can be hugely advantageous depending on your financial goals and long-term objectives.

The Right Time to Consider Financial Planning for Newlyweds

In most instances, the earlier a couple can buy life insurance the more beneficial it tends to be.

Life insurance can be a whole lot cheaper in your 20s and 30s as compared to your 40s and 50s.

There is a lot less paperwork involved when you are younger as you are likely healthy and don’t have a complex medical history.

As such, there is often no need for any medical exams or detailed paperwork to secure a policy.

Planning early not only secures your future but also locks in lower premiums while you’re young and healthy.

Benefits of Joint Life Insurance Policies

Joint life insurance covers both spouses under one policy. This way, if either spouse were to pass away unexpectedly a death benefit would be paid out to the other.

Having a joint life insurance policy can be comparatively cheaper than having two separate policies (one for each spouse).

Having just one policy would also mean less paperwork and hassle.

So, while having separate life insurance policies can be beneficial if the income, financial obligations, and coverage needs of each partner are significantly different, joint life insurance policies can be perfect for couples without dependents or those focused on leaving a financial legacy.

Life Insurance Premiums and Coverage

The cost of life insurance can depend on several factors, like age, health, sex, medical history, lifestyle and coverage amount.

In most cases, the younger and healthier you are the more affordable coverage options you are likely to find.

The real challenge is determining how much coverage you really need.

To get a quick idea or ballpark estimate, the rule of thumb is to 10-12x your annual income.

However, remember that your current financial situation, debt, mortgage, and future financial planning objectives can all impact the coverage amount you may need.

Opting for a policy with too high of a coverage amount would mean having to pay more in premiums while a policy with too low of a coverage amount may leave your spouse financially vulnerable.

So, for a more accurate figure, it is always advisable to speak to a reputed advisor or to use a life insurance calculator.

The Role of Life Insurance in Estate Planning

Life insurance isn’t just for peace of mind and financial security; it’s also a vital part of estate planning.

Having a policy in place can ensure your spouse or dependents receive benefits without legal hiccups.

Death benefits are also tax-free and with clearly mentioned beneficiaries life insurance can ensure a smooth wealth transition process and continued family stability.

Policy Riders and Additional Benefits

Life insurance also offers couples the luxury to add riders such as Accidental Death, Disability Waiver, and Child Care to maximize protection without having to buy additional policies.

Life insurance can also be bundled with other forms of insurance such as auto, home, and business insurance to further lower costs.

Choosing the Right Type of Life Insurance

As newlyweds, life insurance ensures your partner isn’t left shouldering financial burdens alone.

Whether it’s protecting your home, paying off student loans, or securing future plans, having the right policy can make all the difference.

So, how do you choose the right type of life insurance?

Our advice would be to consult with a trusted insurance broker who can help you pick a policy that fits your unique situation and future plans.

Nova Scotia’s Trusted Insurance Brokerage Firm – McIver Insurance Inc.

At McIver Insurance Inc., we specialize in helping Nova Scotian couples secure their future with tailored life insurance solutions.

We are an insurance company that always puts you first and have helped hundreds of Nova Scotian families get the peace of mind they deserve!

What are you waiting for?

FAQ Section

Q1) What is the best time for newlyweds to buy life insurance?

Right after marriage. The earlier you buy, the cheaper the premiums.

Q2) How do we decide how much coverage we need?

Multiply your income by 10–12 years and factor in debts, future expenses, and savings.

Q3) Can life insurance policies be adjusted if our financial situation changes?

Yes, you can increase coverage or add riders as needed.

Q4) What happens to my life insurance policy if I get divorced?

Ownership and beneficiary designations may need adjustment. Seek professional advice.

Q5) Are there any life insurance policies that also contribute to retirement savings?

Yes. Permanent life insurance policies build cash value, which can supplement retirement income.

January 16 2025

Key Life Insurance Benefits Business Owners Overlook

Pat McIver Life Insurance Life Insurance

When you’re running a business, the hustle never ends.

Managing employees, deadlines, and chasing growth are likely always on your daily priority list.

But what about planning for the unexpected?

Just like your family needs financial security, so does your business.

Key Person Life Insurance can help safeguard your business, secure its future, and help you reap financial benefits that foster growth and sustainability.

Here is a list of key life insurance benefits that many Canadian business owners often overlook during their decision-making process and why you shouldn’t make the same mistake.

6 Key Life Insurance Benefits Business Owners Overlook

1. Key Person Insurance: A Safety Net for Your Business

What happens if you unexpectedly lose a critical team member? Say, a top sales executive, or a lead technician? Will this impact your business’s bottom line?

If so, you need to consider key person life insurance.

This life insurance policy provides a financial cushion to keep your business afloat should an essential employee pass away or become incapacitated.

The policy can cover recruiting and training replacement costs, offset lost revenue, and help stabilize operations.

2. Business Continuity and Succession Planning

Life insurance ensures your business survives and thrives during a transition.

It can be beneficial in situations such as:

Buy-Sell Agreements: Life insurance funds can be used to purchase shares of an outgoing partner in case of death, ensuring the business remains with existing owners.
Family Business Continuity: Policies can provide liquidity to cover taxes or debts, preventing families from selling their business prematurely.

Take the case of a family-run fishery in Halifax. When the founder passed, a life insurance policy helped pay estate taxes and funded the transition to the next generation without disrupting operations.

3. Tax Benefits and Implications for Business Owners

Life insurance doesn’t just protect – it can save you money, too.

Here’s how:

Tax-Free Death Benefits: Payouts from life insurance policies are typically tax-free, providing clean liquidity for your business.
Deductions in Certain Cases: Premiums for policies used as collateral or employee benefits may offer tax deductions (consult a tax advisor for specifics).

Canadian tax laws often favour life insurance, making it a smart move for small businesses looking to minimize liabilities when securing their future.

4. Collateral for Business Loans: An Untapped Resource

Many business owners fail to realize that life insurance can be used as collateral for loans.

Banks and lenders view it as a secure way to reduce risk.

Here’s how it works:

Assign your policy to the lender as collateral.
If the loan isn’t repaid, the lender gets the payout from the policy.

This is especially useful for startups and small businesses in Nova Scotia, that often struggle to raise funds through traditional financing.

A well-negotiated life insurance-backed loan can be extremely useful to fund expansions or cover cash flow gaps.

5. Enhancing Employee Benefits with Life Insurance

Including life insurance in employee packages can boost morale and retention rates.

Employees value security, and group life insurance offers just that.

It is also beneficial for the employer.

Life insurance can often be more cost-effective for the employer than raises or bonuses and delivers greater perceived value to employees.

We recently saw the power of adding life insurance to employee benefits when we set up a group plan for a Dartmouth-based manufacturing company struggling with employee retention.

After introducing group life insurance as part of their benefits package they saw a 20% reduction in turnover and a noticeable improvement in employee morale; showcasing just how valuable life insurance can be.

6. Protecting Personal and Family Interests

Business-owner life insurance isn’t just for the company—it protects your loved ones too.

Policies can:

Provide income replacement for your family if you’re no longer around.
Cover personal debts tied to the business, ensuring they aren’t passed on to family members.

By integrating business and personal financial planning, you can ensure stability for both your company and your loved ones.

Navigating the Legal Landscape of Life Insurance in Business

Life insurance comes with its share of legal complexities, from ownership structures to policy assignments and more.

As a business owner, it’s crucial to:

Understand policy terms and legal obligations.
Consult a lawyer to avoid common pitfalls, like unclear beneficiary designations or improper tax handling.

In Nova Scotia, provincial regulations may add additional considerations, so working with local experts is highly recommended.

We at McIver Insurance Inc. ensure compliance and optimized planning to help you best navigate insurance’s complex legal landscape.

Your Business Life Insurance Partner

At McIver Insurance Inc., we understand the unique needs of Nova Scotian business owners and support them by helping them navigate health and dental plans, close insurance gaps, and provide group benefits to their employees.

As Nova Scotia’s most trusted insurance brokerage firm our team specializes in crafting life insurance strategies for small businesses with 2-10 employees.

These policies are cost-effective and designed to protect your business, optimize your finances, and ensure business continuity.

To learn more call now or click here to book a free no-obligation meeting with our trusted advisors!

FAQ Section

Q1) What is key person insurance and why is it crucial for my business?

Key person insurance protects your business financially by covering losses related to the death or incapacitation of critical team members.

Q2) How does life insurance facilitate business continuity planning?

Life insurance can fund buy-sell agreements, pay estate taxes, and provide liquidity for smooth ownership transitions.

Q3) What are the tax benefits of incorporating life insurance into my business strategy?

Death benefits are tax-free, and premiums may be deductible for certain business purposes.

Q4) Can life insurance be used as collateral for business loans?

Yes, policies can secure loans, making it easier to access financing while offering lenders added security.

Q5) How does offering life insurance as an employee benefit help my business?

A group plan that includes life insurance can help improve employee retention and satisfaction while being a cost-effective alternative to other benefits such as bonuses and raises.

December 16 2024

How Smoking and Alcohol Consumption Affect Your Life Insurance Rates

Pat McIver Life Insurance Life Insurance

Why is life insurance so much more expensive for smokers or those who drink heavily?

The answer lies in the underwriting process.

When you apply for life insurance, insurance providers assess your health risks based on lifestyle choices, including smoking and alcohol consumption.

These habits are proven to increase the likelihood of serious health issues, which means higher premiums for those who partake.

But how much of an increase in premiums are we looking at? Also, is there a way to reduce the premium cost if you quit smoking or drinking? And what happens if you don’t disclose you are a smoker or a drinker?

For answers to these questions and more, read on!

How Smoking Impacts Life Insurance Rates

While smoking was considered “cool” and “harmless” in the early 20th century, that time has passed.

According to the World Health Organization, tobacco kills up to 50% of its consumers if they don’t quit in time.

As such, smokers pay significantly more for life insurance than non-smokers.

Smoking Habits

Insurers look at how much and how often you smoke.

Whether it’s a daily pack or the occasional cigarette, you’ll be categorized as a smoker during underwriting. Even vaping or using nicotine patches can sometimes count.

Health Risks

Smoking is linked to a host of health problems, from lung cancer to heart disease.

These risks lead to a higher likelihood of claims, which is why insurers raise premiums for smokers.

Comparison of Premiums

The numbers are stark: a 40-year-old non-smoker in Nova Scotia might pay $50/month for a term life insurance policy, while a smoker could pay over $120/month for the same coverage.

Over time, that difference adds up to thousands of dollars.

How Alcohol Impacts Life Insurance Rates

If you are an occasional drinker your premiums won’t be impacted as much as if you were an occasional smoker.

However, if you have a history of alcoholism, this can greatly impact the underwriting process. If alcohol consumption is heavy, frequent, or considered “risky” it can significantly increase life insurance rates.

For insurers, “risky drinking” often means consuming more than 3-4 drinks a day or binge drinking which can cause liver disease, heart problems, and mental health issues.

These health risks translate to higher premiums.

Moderate drinkers may also face higher premiums if their medical history raises concerns.

During the life insurance application process, you will be asked about your drinking habits and require medical tests that check for liver and heart damage.

The Impact of Smoking & Drinking on Insurance Costs

When both smoking and heavy drinking are part of your lifestyle, the premium quotes on life insurance can often be astronomical.

The health risks of smoking and drinking don’t just add up—they multiply. The chances of heart disease, cancer, and other life-threatening conditions skyrocket when these habits are combined.

To compensate for the added risk insurers often double or triple premiums for individuals with both habits.

In some cases, policies may even exclude coverage for conditions caused by smoking or drinking.

So, for example, if you are a smoker and heavy drinker not only will you pay higher premiums but there may be an exclusion in your policy that prevents your beneficiaries from being able to make a death benefit claim if you were to pass away as a result of lung cancer, liver failure, or other related illnesses.

The Underwriting Process for Smokers and Heavy Drinkers

Here is a breakdown of the underwriting process that insurers use to evaluate the risks posed by smoking and alcohol consumption.

Medical Evaluations

If you are a smoker or heavy drinker expect to undergo a medical exam, which might include blood and urine tests.

These tests can reveal nicotine use or elevated liver enzymes linked to alcohol.

Premium Calculation Methods

Insurers use actuarial tables to determine how your lifestyle affects your life expectancy. The more risks you pose, the higher your premium.

Even if you’re young, smoking or drinking heavily can make your premiums resemble those of someone twice your age.

Financial and Health Implications for Policyholders

The costs of smoking and drinking go beyond just higher premiums—they also affect your overall financial and physical well-being.

The cost of higher premiums is often nothing compared to what you are actually spending on cigarettes, alcohol, and healthcare.

By quitting these unhealthy habits you can save a lot of money, improve your health, and possibly increase your lifespan.

Qualifying for Lower Premiums

To qualify for lower premiums you will need to quit smoking and/or drinking for at least 12 months.

Once a year has passed you can sign a declaration stating you have quit and undergo a medical test to prove you are nicotine and alcohol-free.

The longer you quit, the more favorable your life insurance rates become.

After three years, your insurance rates can be as low as that of an individual who has never smoked or drank in their lifetime.

Legal and Ethical Considerations

Lying during the application process is only going to result in a denied claim.

When applying for life insurance transparency, full disclosure, and honesty are key.

There is no point paying premiums all your life only for the claim to be denied due to an unstated lifestyle choice.

The same is the case for insurers.

In Canada, insurers must adhere to laws that prevent discrimination while fairly assessing risks. They are responsible for treating all applicants fairly ensuring no one is overcharged or unfairly excluded.

While they’re allowed to charge higher premiums for high-risk lifestyles, this has to be based on clear evidence.

Get Insured Today by Nova Scotia’s most Trusted Life Insurance Broker

At McIver Insurance Inc., we understand that lifestyle choices can make life insurance more expensive, but that doesn’t mean you shouldn’t opt for a policy.

Quitting smoking, drinking responsibly, and maintaining a healthy lifestyle can go a long way toward lowering your premiums and our expert guidance can help you get there.

For personalized advice and competitive rates in Nova Scotia, call today!

FAQ Section

Q1) How does smoking cessation affect my life insurance rates?

If you quit smoking and remain smoke-free for at least a year, your premiums will lower. After three years, you may qualify for significantly lower non-smoker rates.

Q2) Can occasional drinking affect my life insurance premiums?

Occasional drinking typically doesn’t impact premiums, but excessive or binge drinking might.

Q3) What are the potential benefits of disclosing my smoking and drinking habits during the insurance application process?

Honesty ensures your policy won’t be voided later. Plus, many insurers offer options to re-evaluate premiums if you improve your habits.

Q4) Are there insurance providers that specialize in policies for individuals with high-risk lifestyles?

Yes, some providers focus on offering coverage tailored to smokers and heavy drinkers, but premiums will still reflect the associated risks.

November 14 2024

Life Insurance for New Canadians: What You Need to Know

Pat McIver Health Insurance Life Insurance

Canada has always been a land of immigrants. Even today, over half a million new immigrants come to Canada annually; the highest in any country.

If you are planning to move to Canada or are already here, understanding Canada’s laws, regulations, culture, and job market can take time.

One financial tool that can help safeguard against uncertainty is life insurance. In Canada, opting for life insurance early can be quite beneficial for new families.

However, choosing the right policy is easier said than done. With so many options, deciding on the right type of life insurance can often feel overwhelming.

That is why we have prepared the following guide to walk you through everything you need to know about life insurance in Canada as a new immigrant.

Different Types of Life Insurance Options in Canada

While there are many variations of life insurance in Canada, the two main types are term life insurance and permanent life insurance.

Term Life Insurance

Term life insurance provides coverage for a set period, for example, 10, 20, or 30 years. It’s straightforward and has lower premiums, making it a popular choice for New Canadians.

If you’re focused on affordability and protection during key life stages, term insurance may be ideal, especially if you have young children or a mortgage.

Permanent Life Insurance

As the name suggests, permanent life insurance policies provide lifelong coverage and can often build cash value over time.

While pricier than term policies, they can offer long-term benefits, like cash value accumulation, which you can use for retirement or emergencies.

For newcomers planning to settle in Canada for the long haul, permanent life insurance could be worth considering.

Additional Types of Coverage

Critical illness and disability insurance are additional types of coverage that pay out if you’re diagnosed with a severe health condition or become unable to work due to disability.

With the healthcare system and job market potentially new territory, these policies offer an added layer of protection, ensuring financial security during health crises.

The Coverage Needs of New Canadians

Calculating the right amount of life insurance coverage can be tricky, even for Canadians who have lived here for generations.

To avoid under or over-insuring think about your family’s immediate and future financial needs if you were to pass away.

Jot down mortgage payments, education expenses for children, outstanding debts, monthly expenses, funeral costs, and any long-term savings goals. Also, consider your family’s size, and the needs of any supporting family members back home.

Add everything up and that should provide an estimate of how much life insurance coverage you need.

The Cost of Life Insurance for New Canadians

Life insurance premiums in Canada vary based on age, health, gender, lifestyle, occupation, coverage amount, and type of policy.

Permanent policies usually come with higher premiums than term insurance, but they offer the advantage of lifelong protection.

On average, according to the Canada Protection Plan, the cost of life insurance in Canada for newcomers can range anywhere from $15 to $100 per month.

To find the best value it is best to shop around or consult with an insurance b roker. They can help you compare costs against potential benefits and find affordable plans that fall within budget.

In Nova Scotia, for example, some banks or credit unions have exclusive options for newcomers and a trusted insurance broker can help you narrow down your options.

The Application Process for New Canadians

Applying for life insurance as a New Canadian is relatively simple but may differ slightly based on your immigration status and length of stay.

Generally, you’ll need identification, proof of residence, and accurate disclosures about your health and lifestyle.

Some policies may require a medical exam or credit check, and having a clean record can improve your chances of approval and lower premiums.

Accurate information on the application is vital to avoid issues with policy payouts down the road.

Legal and Regulatory Considerations

Canada has stringent regulations around life insurance to protect policyholders.

Provincial regulations, like those in Nova Scotia, safeguard policyholders, ensuring transparency and accountability from insurers.

Always remember that as a policyholder, you have rights, including the right to fair treatment and transparent contract terms.

You should also know that beneficiaries don’t pay income tax on death benefits. They get a full payout without any tax deductions.

Choosing the Right Life Insurance Advisor – McIver Insurance Inc.

When buying life insurance, it’s helpful to have an advisor who understands the unique needs of New Canadians.

At McIver Insurance Inc. our advisors are familiar with immigrant experiences and can help bridge cultural or language gaps. Our licensed and experienced advisors take the time to answer your questions and understand your unique needs.

As Nova Scotia’s most trusted insurance brokerage firm we can help you select a policy that meets your needs and budget ensuring you make the best choice for your family’s future.

FAQs

Q1) What is the difference between term and permanent life insurance?

The main differences between the two policies are coverage duration, cost, and benefits. Term life insurance provides coverage only for a specific period and is generally more affordable. On the other hand, permanent life insurance offers lifelong coverage and additional benefits such as “cash value” that accumulates over time and can be borrowed against or withdrawn at any stage.

Q2) How can I lower my life insurance premiums as a New Canadian?

The most obvious way is to choose a term policy over a permanent one as term policies usually have much lower premiums. Another way to lower premiums is to ensure you maintain a healthy lifestyle by not smoking and exercising regularly. You should also try to get insurance as early as possible. The younger and healthier you are the lower your premiums are likely to be.

If you are still not finding a quote that matches your budget try reducing your coverage amount or consider bundling insurance policies to get better discounts by consulting with a trusted insurance advisor. The more you shop around and compare quotes the better quotes you are likely to find.

Q) What should I look for in a life insurance advisor in Canada?

When seeking a life insurance advisor in Canada make sure they are licensed to sell insurance and have proper credentials such as being a CFP or CLU. Ensure they understand the unique financial needs and considerations of new immigrants and offer a transparent fee structure. Look for positive reviews and recommendations and pick a provider that offers a wide range of insurance products and is always available to answer queries.

November 14 2024

What Happens to Your Life Insurance When You Retire?

Pat McIver Life Insurance Life Insurance

Retiring can be exciting for many Canadians but also nerve-wracking. It marks the beginning of a new chapter and can bring significant lifestyle changes.

But what about life insurance? What happens to your life insurance policy when you retire? Do you cash out your policy or does it just lapse? And do you even need life insurance during retirement?

The answer, as is the case with most personal finance questions, is “It depends”. On what? Let’s find out!

Understanding Life Insurance & Its Types

Life insurance is a financial tool that provides a financial safety net for family members in the event of a policyholder’s death.

There are two types of life insurance policies in Canada, term life insurance and permanent life insurance.

Permanent Life Insurance

Permanent life insurance options, like whole and universal life, offer coverage until death. These policies also accumulate cash value over time, which can be accessed during retirement.

This makes this type of policy a popular choice for Canadians seeking both coverage and an additional source of income during retirement. However, permanent life insurance policies have higher premiums than term policies, but they’re often worth it.

Term Life Insurance

With term life insurance, coverage lasts only for a set period, like 10, 20, or 30 years. This means if your policy expires before or during retirement, you might find yourself without coverage at a time when you may need it most.

However, many term policies do offer conversion options that allow you to shift to a permanent policy if you’re nearing the end of your term or are close to retiring. It’s always advisable to review these options by consulting with an insurance broker.

What Happens to My Life Insurance Policy When I Retire?

When you retire your life insurance can change depending on what policy type you have, your financial situation, and your personal needs.

If you have a permanent or whole life insurance policy, nothing changes. As long as you continue making premium payments your policy will remain active till you die.

If you have a term life insurance policy or a group plan you may lose coverage upon retirement or have to cash out your policy. However, most life insurance plans can be maintained, adjusted, or converted to ensure continued coverage during your golden years.

You may have to pay slightly higher premiums but you can convert your term policy to a permanent policy or change your group plan to a personal plan without having to undergo a medical exam or paying any unnecessary costs.

Do I Need Life Insurance in Retirement?

Again, “it depends”.

Ask yourself, what do you need life insurance for? Do you have a spouse or children who can benefit from keeping the policy? Do you have a small business or business partner that your policy can protect? What are the sources of your retirement income? Do you have enough to pay for premiums?

If you aren’t making an income, or don’t have dependents, you may not need life insurance when retiring.

However, if you do have dependents, and you feel that your family would benefit from a life insurance payout, opting for a permanent life insurance policy, particularly one with a cash value component, can be in your best interest.

You can borrow against this cash value or even use it to cover unexpected expenses without having to rely on your primary retirement savings.

Adjusting Life Insurance Upon Retirement

When you retire, it’s wise to reassess your coverage needs to ensure your policy matches your new lifestyle and financial situation.

Without dependents or a mortgage, your coverage needs may be lower than during your working years. Lowering your coverage amount or even switching to a different type of policy could potentially help you save on premiums.

Another option, if you’re holding a term policy nearing expiration, is policy conversion. Many term policies let you switch to a permanent policy, which is helpful if you still want coverage but without the time constraints.

Tax Implications of Life Insurance for Retirees

Life insurance has some unique tax benefits that retirees can use to their advantage.

Proceeds from life insurance are generally tax-free, meaning beneficiaries won’t owe taxes on the payout. This is especially helpful when estate planning because it allows you to pass on wealth without significant tax deductions.

Therefore, life insurance also acts as a valuable estate planning tool. By designating policy proceeds to cover any estate taxes or final expenses, you can preserve assets for heirs.

This financial planning approach can lower the tax burden on your estate and ensure that more of what you’ve worked for is passed on without loss to taxes.

Life Insurance as Part of a Comprehensive Retirement Plan

Your life insurance should coordinate with other financial plans like pensions, RRSPs, TFSAs, and savings accounts.

By making life insurance part of a broader retirement strategy, you can support your goals for long-term financial security, ensuring that all your assets complement each other.

Consulting with a financial advisor or insurance broker can also be incredibly beneficial here.

These experts can help you decide how life insurance fits within your broader goals, whether as a source of income, emergency fund, or asset for legacy planning. Advisors can also help identify the best type of policy for retirees, making sure you’re not over- or under-insured.

Challenges & Considerations of Life Insurance for Retirees

Retirees face unique age and health factors when it comes to life insurance. As you age, premium rates can increase, and certain health conditions can make getting coverage harder or more expensive.

Therefore, if you’re looking at policy changes or upgrades, it’s good to consider this sooner rather than later to avoid any unnecessary complications.

Another top tip is to pick a policy that aligns with your future needs rather than your current ones and to find the right balance of coverage and cost, especially when working with a fixed retirement income.

Future Trends in Life Insurance for Retirees

With Canada’s aging population more and more life insurance products come with features like long-term care riders and flexible death benefits. These options provide added coverage for medical or long-term care expenses, allowing you to use your life insurance if you need ongoing care.

In Canada, these types of policies are helping seniors maintain coverage without facing prohibitive costs or restrictions and there are certain providers that are even specializing in life insurance for seniors.

Life Insurance for Nova Scotian Retirees

Life insurance in retirement can be much more than a safety net—it’s a versatile tool that, when managed well, can help support a secure, comfortable retirement that provides peace of mind to retirees and their families alike.

Have more questions? Book a free no-obligation meeting with Nova Scotia’s most trusted life insurance brokerage – McIver Insurance Inc.

FAQs

What happens to my term life insurance when I retire?

Upon retirement or expiration, your term life insurance policy will end without a payout. However, most policies do allow you to convert your term policy to a permanent policy without taking a medical exam.

How can I use the cash value of my life insurance in retirement?

You can tap into the cash value of your permanent life insurance policy in several ways. The most common way is to withdraw directly from the cash value or borrow against it through policy loans. Some policies even allow for cash value to be converted into an annuity or pay out dividends to help supplement retirement income.

Should I keep my life insurance policy after I retire?

Speaking to a financial advisor or insurance expert is the best way to determine whether you should keep your policy or not after you retire. Experts will determine your financial goals, your dependents’ needs, and the type of policy you hold to help you make an informed decision.