New question in Life Insurance FAQ

New question in Life Insurance FAQ:

Hello I'm looking for life insurance policy in Canada that: 1) Requires no medical exam, 2) Can be paid up in 10 years or less and, 3) May be purchased without going through a broker. Thanks for your help

Thanks for the question. In term of a no medical life insurance options. You can choose between Guaranteed Issue (no health questions and no medical tests) and Simplified Issue (3 to 12 health questions and no medical tests) Simplified Issue plans have lower premiums, higher face amounts and can provide coverage from day one. Guaranteed Issue plans have a two year waiting or longer on non accidental deaths. Most direct suppliers of No Medical Life Insurance plans offer Guaranteed Issue plans and non that we are aware of are paid up in 10 years.

Read more questions and answers about Life Insurance FAQ.

Life Insurance for Nurses

There are life insurance
opportunities for nurses.
Photo by Timefornurses

Statistics from the government of Canada indicate that Canadian registered nurses total 273,051 across the country earn an average of $36.22 an hour.

Many of them may get opportunities to purchase life insurance through their group benefits plan or professional associations or organizations. However, individual life insurance may give them more personal customization options to their current life situation.

Life insurance can be broken down into two categories, Term insurance and Permanent Insurance.

Term Insurance starts off lower in costs and increases as the insured gets older. The length of the term can vary. As a rule of thumb, the longer the term, the higher the initial premium, but the shorter the term, the lower the initial premium.

Most term life policies in Canada are renewable and convertible, which means the insured can renew the coverage without a medical, albeit at a much higher premium. They can also convert the coverage to a permanent plan without a medical exam. Term rates can vary significantly from company to company, and many companies offer preferred rates, which can lower the insured’s premium by as much as 30 per cent, but only if the insured happens to be in very good health and has an excellent family health history.

Group vs. Individual Health and Dental Insurance

Getting your health and dental covered
individually or as part of a group.

Group health and dental insurance plans provide coverage for a group of people, while individual health and dental coverage provides coverage to an individual and/or his family.

Group plans can be established through a company, an association, or a religious organization. There are many advantages to a group health and dental plan versus an individual plan. The following are some of the advantages:

1. Group insurance premiums often provide a better value because the cost of coverage is pooled among a larger number of individuals

2. Group insurance policies generally do not require a medical exam making it easier for individuals who have a past history of poor health and pre-existing conditions to qualify for the coverage.

3. Employers generally cover all or part of the group insurance premium.

4. Some group life, disability and critical illness coverage plans allow the employee to continue all or part of the coverage.

Strategies for Maximizing the Value of Your MGA

What it takes to strengthen
the value of your MGA.
Photo by Lin Mei

When evaluating the value of your MGA, don't expect the same level of consistency as you would evaluating a bottle of wine; neither individual books of business, nor MGAs have aged very well.

"It's important to be aware that you can't assume that things will be the same as they have been," said James Hilton, managing partner of Jacox-Hilton Producer Consulting, during an audio presentation sponsored by Advisor.ca.

James Hilton and Cameron Jacox have also joined forces with LSM Insurance for a series of articles on buying or selling a book of business.

"You have to factor in the unpredictable [regulatory] world we are now entering and it's impact on margins and you have to factor this risk into the valuation because the risk is now higher than ever before," he continued.

Traditionally, businesses were valued purely based on revenue multiples such as, three to five times service fees or three times segregated fund trailers.

"The problem here is it really assumes the MGA operates in a vacuum and it's purely cash-flow based," said Hilton. "It ignores the advisors and their books of business, and these are what generally comprise the MGA." Jacox added, "A shoddy advisor base with low productivity that's retirement age is far more important than historical service fees".

Jacox-Hilton's valuation model considers the advisor-centric business , so you can't ignore their books of business and their skill in managing them when valuing the MGA.

Though it may be difficult to accurately pin a price on something -- since prices change on a daily basis -- Hilton and Jacox firmly believe you can go deeper than the traditional calculation being used in the financial industry today.

How Does a Group Disability Insurance Offset Work?

You can offset
your disability insurance.
Photo by Dave Gingrich

Individuals who are looking at augmenting their individual disability insurance, but also have group disability insurance, should be aware of how group offsets work.

Group insurance offsets protect the insurance company from over insuring individuals for disability insurance. If an individual has group disability insurance coverage, their individual disability insurance may be offset by their group coverage.