Life Insurance / Permanent Life Insurance
Permanent Life Insurance: Coverage That Lasts a Lifetime
Permanent life insurance never expires as long as premiums are paid. It guarantees a tax-free payment to your family, builds cash value over time and can play a key role in your estate plan.
Term insurance protects your family for a set number of years. Permanent insurance protects them for life, so the benefit will be paid no matter when you pass away. That makes it ideal for needs that never go away: final expenses, taxes on your estate, a business succession plan or a legacy for your children.
Types of permanent life insurance
Whole life
- Premiums and death benefit guaranteed
- Cash value grows at a guaranteed rate
- Participating policies may earn dividends
Universal life
- Flexible premiums within limits
- Choose how the savings part is invested
- Higher potential growth, more responsibility
Term to 100
- Lowest-cost lifetime coverage
- Level premiums, usually paid to age 100
- Little or no cash value
Learn more about whole life and universal life insurance.
Why families choose permanent coverage
Pay estate taxes
Cover the tax due on RRSPs, RRIFs, a cottage or investments, so your family doesn’t have to sell them.
Learn more →Leave a legacy
Pass on a guaranteed, tax-free amount to children, grandchildren or a charity.
Final expenses
Pay for the funeral and final costs without using your family’s savings.
Tax-advantaged savings
The cash value grows tax-sheltered within the limits set by the Income Tax Act.
Business planning
Fund a buy-sell agreement or protect a business from the loss of a key person.
Lifelong protection for a dependant
Provide for a child with a disability or anyone who will always depend on you.
Learn more →Life insurance and tax in Canada
- The death benefit paid to a named beneficiary is generally tax-free
- Naming a beneficiary keeps the payment out of your estate and probate
- Growth in the cash value is tax-deferred within legal limits
- Withdrawals or policy loans above the adjusted cost basis may be taxable
- Personal life insurance premiums are generally not tax-deductible
Tax rules are complex and can change. We work with your accountant to fit your policy into your overall plan.
Frequently asked questions
Is permanent insurance worth the higher cost?
If you only need coverage while your children are young or your mortgage is unpaid, term insurance is usually the better value. If you have a lifelong need, such as estate taxes or a legacy, permanent coverage guarantees the money will be there.
Can I borrow against my policy?
Yes. Whole and universal life policies with cash value let you take a policy loan or use the policy as collateral for a bank loan. Any outstanding loan reduces the death benefit.
Can I convert my term policy to permanent later?
Many term policies can be converted to permanent coverage without a new medical exam, usually before a certain age. Check your policy’s conversion option.
Talk to Devendra Kumar, Financial Planner (CLU, CHS)
DK Insurance & Investments Inc. serves families across the GTA from offices in Vaughan, Mississauga and Brampton. Call or text +1-647-761-0517 for a free, no-obligation conversation.