Life Insurance for Lawyers

Posted on December 13, 2011 and updated January 23, 2012 in Insurance Types, Life Insurance Canada News, Permanent Insurance, Term Insurance 3 min read

According to the Canadian Government, there are approximately 77,935 lawyers working across Canada, 93% of whom work full-time and make a median hourly wage of $40 — exactly double all the other occupations.

This translates to just under 80,000 lawyers who could potentially need life insurance.

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 that the insured can renew coverage without a medical exam, albeit at a much higher premium. They can also convert the coverage to a permanent plan without a medical. 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%, but only if the insured happens to be in very good health and has an excellent family health history.

Permanent Life Insurance can be subdivided into three types of plans:

Term to 100 insurance provides level premiums and lifetime protection. Term 100 policies generally do not build cash value. However, some companies offer reduced paid-up coverage if the insured wants to stop paying. Most Term 100 plans have increased in cost in recent years due to historically low interest rates, and many carriers in Canada no longer offer Term 100 coverage

Universal Life coverage offers lifetime protection with flexible premiums, and most Universal life policies come with an increasing cost of insurance. For example, where the cost of insurance starts off lower and increases as the insured gets older, or a level cost-of-insurance option, which provides a fixed cost-of-insurance for the life of the policy. Similar to Term 100 coverage, most Universal Life, level cost-of-insurance policies in Canada have increased in price, as a result of low interest rates

Whole Life policies can be broken down into Non-participating and Participating policies. The former offers lifetime protection, guaranteed premiums, and a guaranteed cash value. However, these policies do not produce a dividend. The latter (participating policies) offer fixed premiums, lifetime protection, and guaranteed cash value, but they also produce an annual dividend, which allows the insured to participate in the profits of their life insurance carrier.

For more details on which life insurance policy is best for you, please contact us at 1-866-899-4849 or visit our Term Life, Whole Life or Universal Life quote pages

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Tyronne
Tyronne

Does the Future Income Option on my disabity policy allow me to increase my benefit without a medical. It’s been a while since I looked into this.

LSM Insurance
LSM Insurance

A future income allows the insured to upgrade their disability coverage without a medical but their is still Financial Underwriting

Peter J
Peter J

Can I add a disability rider to my existing after it is taken out or do I need a add a new policy/ Thks

LSM Insurance
LSM Insurance

I assume your are talking about a disability income replacement component and not a disability waiver of premium which just waives the premiums if you become disabled. Some policies have disability insurance available as rider but most do not. Most higher end disability plans are only available on a stand alone basis.

Syed Raza
Syed Raza

Hi Howie, You may want to consider term and permanent combination scenarios using a strategy called ‘Layering’. For example, you can purchase $100k of permanent life insurance and add another $100k each of Term 10 and Term 20 as riders in the same policy. The policy would initially cover you for the full $300k face amount. As long as you cancel your riders as they come up for renewal, your coverage will decrease to $200k after 10 years and $100k after 20 years. You will be left with $100k of permanent insurance at the end to protect you for the… Read more »

LSM Insurance
LSM Insurance

Thanks for the note Howie.

It’s hard to advise you which plan is best without discussing your needs. If you are looking for coverage while your children are small you could likely go for a shorter term and a hence a lower initial premium. If you want some Permanent a 30 year won’t be a good solution beyond the 30 years.

We will you a separate email.

Howie
Howie

I’m a 50 yr old male, in good health; wife, 42 yrs, occasional smoker, also healthy; two children ages 14 & 10,. We are seeking a term life insurance quote for $300k over 30 years but aren’t entirely sure if that’s the best route to take given our age/stage. Hoping you can provide a quote and/or offer advise on a more economically sound plan??