A recent poll from a major Canadian insurer reveals that many Canadian couples are leaving an important topic out of their conversations: life insurance planning. In fact, the poll found that almost a third (31%) of couples — many of them with children — had never discussed life insurance. And those under 35 were the least likely to have talked about it.
This oversight has potentially serious implications. Not discussing insurance could mean not having any coverage, having insufficient coverage, or even having the wrong type of insurance.
Why don’t couples talk about insurance? Of those who were reluctant, 59% said they had never thought about it while 35% attributed it to a lack of seriousness in their relationship.
If you’ve never thought about it, now’s the time. Life insurance planning is essential to your family’s financial well-being. It ensures that your surviving partner — and children if you have them — will be financially secure. If you should both pass away, it ensures that your children’s guardians will have the financial resources needed to provide your children with the lifestyle you want them to have.
And the sooner you have the conversation, the better. Life insurance premiums are based on age and life expectancy, so the younger and healthier you are, the less you’ll pay. In addition, if you purchase permanent insurance or term insurance that’s guaranteed renewable, you can ensure you’ll have coverage even if you later develop health issues that would otherwise make you uninsurable.
Whole life insurance can also be leveraged to plan for your children’s education and provide you with a tax efficient way to save. Some whole life insurance policies will even allow you to borrow against them if an unforeseen financial problem arises during the course of your life.
Even if you already have insurance, it’s important to revisit it at least every few years. Your needs will change over time as your life changes.
For example, we should definitely review your coverage if you undergo a significant life event, such as the birth or adoption of a child, a change in marital status, or the purchase of a home or vacation property.
We may need to increase your coverage, decrease it, or select new beneficiaries based on your new circumstances.
We understand how difficult it is to talk about life insurance planning. After all, it means considering the consequences if you or your partner were to pass away. But the death of a family member is difficult enough to manage without having to face the prospect of financial hardship or a major change in lifestyle.
Sitting down with an objective, knowledgeable third party can often make the discussion easier. Meeting with a licensed insurance broker is your first step to starting the discussion. That will give you a chance to learn about some of your other common goals, and help ensure that your overall financial strategy is a joint effort that suits both your needs, as well as those of your children.
Then you’ll have the peace of mind knowing that, in the case of a negative life event, there’s better financial security in your family’s future.