Do Younger Canadians Need Insurance?
In recent years, the COVID pandemic has brought our mortality into sharp focus, compelling us to confront the uncertain and often-unpredictable nature of life. Indeed, this uncertain time has made all of us wonder about the prospect and impact of death, regardless of age or circumstance.
Unfortunately, this period has also highlighted that nobody is too young to consider life insurance. The reasons why one may consider life insurance are diverse, ranging from important milestones like getting married, or having children, and buying a first home, or to simply securing a family’s income and future insurability. Here are a few reasons for your clients to consider life insurance… at any age.
Insurability
One great thing about purchasing life insurance at a young age is that once the carrier issues your client their contract and they settle it by paying the first premium, only they (your client) can change that contract. Their insurability is locked in and the younger they are when they procure their life insurance, the greater the chance they will be able to secure more favourable standard rates.
Mortgage Insurance
For your clients, securing life insurance on their mortgage is a way to ensure that, if anything happens to them, their family can retain their home and maintain some financial security. By obtaining a lump-sum payment upon the policyholder’s death, the surviving partner or family member can use it to settle any outstanding mortgage balance, thereby securing the home’s ownership and providing a measure of financial security during a difficult time.
There are also benefits to maintaining life insurance independent of a mortgage lender and we invite you to share this video INFOclip: Mortgage Protection with your clients, to showcase these benefits.
Income Earning
Your clients’ earning power is perhaps their greatest asset. What would your client do if they couldn’t rely on their income to cover a mortgage, rent, car payments, daycare, groceries, etc.? Having life, critical illness or disability insurance in place can offset a potential loss of income when your client, and perhaps their family, are going through a challenging period. Share this interactive tool Insuring Your Greatest Asset with your clients to establish the importance of earning power and how to protect it.
Aging Parents
According to one recent poll more than 25% of Canadians aged 30+ are caring for aging loved ones (1). Having life insurance in place to ensure your client’s aging parents get the care they need, if they were unable to, could be a significant consideration for your client. Without your client’s assistance, their parent or family member’s care may fall solely on government programs.
Debt
At a young age, your client may have accumulated some debt and even had a parent or family member co-sign for a loan or mortgage. In the event your client passes prematurely, they would be responsible for any outstanding payments. Life insurance could guarantee that their loved ones would not carry the burden of unexpected, additional payments or debt.
Final Expenses
The average cost of a funeral in Canada varies based on province, and that cost can be as high as $20,000 – which is no small amount (2)! By investing in life insurance, your client can ensure the financial responsibility for their funeral does not fall upon their loved ones and alleviates the potential of leaving behind an unexpected financial burden for their family during an already tough situation.
We discussed why a young individual should consider purchasing insurance, but now let’s quickly look at the biggest misconception about insurance of all – the cost. A 2021 study found that more than half of consumers overestimated the cost of life insurance by 300% (3)! However, life insurance is relatively inexpensive for a healthy young Canadian. For example, a 28-year-old Female non-smoker could pay as low as $20 a month for $1,000,000 in coverage with a Term 10 policy (4). Be sure to clear up these misconceptions with your client.
Everyone benefits from making wise financial decisions early in life and, as life circumstances change, insurance can provide your clients and their family with peace of mind and financial security as a safeguard against unforeseen events.
For more information about the benefits of insurance we invite you to review and share this additional content with your network Exploring Your Life Insurance Options
https://amiai.ca/explore-your-life-insurance-options