Buying life insurance for the first time can be a daunting process. But it doesn’t have to be.
If you’re thinking about buying life insurance for the first time, chances are you’re familiar with some of its advantages. For example, you’ve probably heard from friends and family that life insurance can provide your beneficiaries with financial assistance when you pass away. That could be particularly important if you’re responsible for a large part of your household’s income or if you carry out valuable tasks, such as looking after children.
That said, buying life insurance for the first time can feel overwhelming. But it doesn’t have to be that way. Here are some helpful tips that can make the process a lot easier.
1. Know what you need
Take advantage of the resources we’ve provided on this website to gain a better understanding of life insurance and the options available to you.
Term life insurance offers more affordable coverage for a specific period of time, while permanent life insurance – like participating life insurance and universal life insurance – provides more comprehensive, lifelong coverage that can build cash value to support your future financial needs. Keep in mind that term life insurance becomes more expensive each time it’s renewed.
2. Find an insurance provider that meets your needs
The insurance you buy is only as good as the company behind it. After all, insurance has to be there when you need it – and that could be tomorrow or a few decades from now.
That’s why it’s important the company providing you with insurance is strong, stable and able to support their guarantees. London Life has been in the Canadian insurance business for nearly a century and a half.
3. Determine how much insurance you need
Calculate the expenses your family will incur after your death, including one-time expenses like funeral costs, as well as ongoing costs, such as groceries, tuition and mortgage and car payments. You should also consider future expenses, such as paying for a child’s post-secondary education.
This should give you a rough idea of how much money your family would need if you passed away.
4. Don’t overlook critical illness and disability insurance
Keep in mind that, as your career progresses, you may experience a serious illness or injury. That’s why it’s a good idea to consider buying critical illness and disability insurance with life insurance.1Footnote 1
After all, ask yourself this: Would you be able to support yourself if you couldn’t work for a month? How about 6 months to a year, or even longer?
A financial security advisor can help you build a comprehensive financial security plan that will help meet your needs as well as those of your family.
An advisor can help you understand the products that best fit your needs and budget today. And, as time goes on, you and your advisor can work together to update your financial security plan to reflect your changing needs and lifestyle.