You could be right. If you’re in your teens or early twenties and you’re not married or have no obligations, you likely don’t need insurance. However, for the rest of us, insurance can plan a vital role in our financial and/or estate plans.
Below are some of the reasons why insurance may be important to you:
1. You have financial obligations such as loans or mortgages and/or have a wife and children that depend on your salary to live.
2. You are planning to start a business with or without partners. This may be a requirement of any bank or shareholder agreement.
3. You are contemplating succession planning where one or more children aren’t involved in the business and require equalization payments.
4. You and your spouse have maximized your RRSP and TFSA limits and are looking at alternative means to invest in tax-sheltered investments to bolster retirement savings.
5. You and your spouse have saved up a sizeable nest egg and would like any remaining monies go to your children. Insurance can play a role in maximizing the estate and paying taxes upon death.
6. You own a successful business with built up retained earnings. Insurance can play a role in minimizing passive income while increasing your overall estate value.
7. Your client owns a business and/or farm that is expected to appreciate in value. Insurance can play a vital role in an estate freeze or reducing taxes upon death.
Unlike other countries in the world, cash values and death benefits within life insurance policies remain tax exempt to the owner and tax free to the beneficiaries.
