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All You Want To Know About Whole Life Insurance

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Whole life insurance refers to a type of life insurance that is permanent in nature. Life insurance is a contract between an insurer and an insured person where the insurer promises to pay a designated beneficiary in event of the death of the insured person. There are different types of life insurance, of which whole life insurance is the most common. As the name itself suggests, whole life insurance is valid for the entire life of the insured. If you get a whole life insurance Canada policy, then the coverage lasts for your lifetime.


Basic concepts


Whole life insurance is the traditional form of insurance. When you want to be insured, the objective is that if something happens to you, your family needs to be protected. With a whole life insurance policy, in case of your death, the beneficiary named by you will receive the sum assured. The policy lasts for your lifetime, unlike term insurance that lasts for a specific number of years. This is why whole life insurance is known as permanent insurance. Due to this nature, the premium to be paid for whole life insurance is higher as compared to term insurance.


To purchase a whole life insurance policy, you need to decide the sum assured or the coverage for the policy. Based on your age and the sum assured, the premium amount would be decided. This is the amount you need to pay at specified intervals (annually, quarterly, etc.). Your policy will remain valid as long as the premium is paid. On the death of the insured person, the death benefit is paid to the beneficiary or beneficiaries named in the policy.


The types of whole life insurance


There are two types of whole life insurance, universal and participating.


1. Participating insurance: This is permanent insurance offering coverage for the lifetime. You are guaranteed the cash value as well as the insurance payout. These policies generally offer a dividend every year. The premium for this policy would be the same throughout its tenure. The money you invest is managed conservatively.


2. Universal insurance: It offers coverage for the entire lifetime. You can decide how you want to invest your money. This form of life insurance clubs insurance with investment. Based on your risk appetite, you can invest your money in different options to earn the best returns. There is greater flexibility for the payment of premiums. The premium is less expensive than participating insurance.


Getting a policy


If you are looking for a whole life insurance Canada policy, then you can get in touch with an insurance advisor. The advisor would be able to guide you about the best policy that meets your needs. Based on your present age, your financial plans, and your tolerance for risk, the advisor would suggest a policy that provides you the best coverage. It is the advisor’s job to ensure you get sufficient protection and also are able to get good returns from your policy.


Life insurance is a contract between an insurer and an insured person where the insurer promises to pay a designated beneficiary in event of the death of the insured person. There are different types of life insurance, of which whole life insurance is the most common. As the name itself suggests, whole life insurance is valid for the entire life of the insured. If you get a whole life insurance Canada policy, then the coverage lasts for your lifetime.


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