Permanent (Whole Life) Insurance

A whole life policy covers you for your entire life. This differs from a term policy since that only lasts for a specific time period. Whole life insurance also builds cash value, which is a return on a portion of your premiums that the insurance company invests. Your cash value is tax-deferred until it is withdrawn. A whole life policy also offers a variety of choices. This includes single-premium, traditional, and interest-sensitive policies. A single-premium is for someone who wants to make one large payment therefore purchasing the policy up front. Like other whole life insurance options, single-premium whole life insurance has the same tax protection on returns, while also accumulating cash value. A traditional whole life insurance policy offers you a guaranteed minimum rate of return on your cash value portion. An interest-sensitive whole life insurance policy offers a variable rate on your cash value portion. With interest-sensitive whole life insurance it is possible to have more flexibility with your life insurance policy. This includes increasing your death benefit without raising your premiums depending on the market and the rate of return on your cash value portion.

What are the benefits of a Whole Life Insurance Policy compared to other life insurance policies?

Unlike term life insurance, a portion of your premium money goes toward your cash value which in turn could pay off your entire policy only after a few years. Also, unless you make a change to your whole life insurance policy, you have lifelong coverage with no future medical exams. Your premium will remain the same during the time you are covered unless you choose otherwise. Lastly, Whole life is also an excellent choice because of the tax savings.

Universal Life

Life insurance solutions are designed for a variety of needs including helping you protect your financial resources, such as your present and future income, preserving your estate for your heirs, supplementing your retirement income and helping you meet other financial planning needs. The proceeds from a life insurance policy could mean that your family or business would not have to sell assets to pay outstanding expenses or taxes. What's more, the death benefit, or proceeds from a life insurance policy are paid tax-free to the named beneficiary of your policy.

We invite you to explore the possibilities and, together with your insurance advisor at DFG, build a financial security plan to help you reach your goals. Universal life insurance is a form of permanent insurance that covers you for your entire lifetime rather than a specified portion of your lifetime as with term life insurance policies. Another key difference between universal life coverage and term life insurance is that in addition to providing life insurance protection, there is also a savings component to your policy. Similarly to RRSPs, a universal life policy allows you to accumulate interest while tax is deferred*, enabling you to realize returns that may be significantly higher than those offered by traditional savings vehicles.

The returns you earn depend on the investment option you select. Returns of the Treasury Bill and Fixed Rate Interest Options are guaranteed. With other interest options, you accept the risk of price variations - both upward and downward. Within the limits of your policy, and as long as you cover the minimum cost of your insurance protection, you can decide how much or how little money would you would like to pay into the policy. As you accumulate funds within your universal life policy, you decide how your premium is invested and can withdraw cash from your policy (some withdrawal charges apply) or borrow against it.