Whole Life Insurance

A Stable Option for Your Financial Plan

When market ups and downs cause concern, whole life insurance can offer a stable way to protect your family and grow your wealth. As a type of permanent life insurance, it provides lifelong coverage with features designed for predictability and peace of mind. Below we explore how whole life insurance works, detailing its benefits, and important considerations to help you decide if it fits your financial goals.

GUARANTEED BENEFITS FOR LONG-TERM SECURITY

Whole life insurance comes with three key guarantees:

• Death Benefit: A tax-free payment to your beneficiaries upon your passing, helping cover expenses like estate taxes or income replacement. Under Canada’s Income Tax Act, death benefits are typically tax-free, though specific tax rules may apply depending on policy use.
• Premiums: Fixed payments that won’t increase, as long as you maintain your policy, making budgeting easier.
• Cash Surrender Value (CSV): The amount you’d receive if you cancel your policy, which grows steadily based on a guaranteed minimum rate set by the insurer. This growth is tax-deferred, meaning you don’t pay taxes on it until you withdraw funds, though withdrawals may trigger tax consequences.

These guarantees provide a foundation of stability, but whole life policies may also offer non-guaranteed dividends, which depend on the insurer’s investment performance and are not guaranteed. Always review policy details to understand both guaranteed and non-guaranteed elements.