Term Life Insurance

To begin with, you need to understand that life insurance falls into two very broad categories: Whole Life Insurance and Term Life Insurance.

Many people are unaware even of the existence of term life insurance, which is a shame because term life insurance is usually much cheaper than the whole life insurance equivalent.

If you are a shrewd investor then term life insurance could be just the option you are looking for. It can work out thousands of dollars cheaper every year giving you that extra money to invest yourself.

Term Life Insurance Cost
The obvious advantage of taking a term life insurance policy over a whole life insurance policy is the cost. Often a term life insurance policy will cost you hundreds of dollars a year but a similar whole life insurance policy can cost as much as thousands.

Term Life Insurance Flexibility
Term life insurance offers you a greater level of flexibility over it's whole life insurance counterpart. For less money you are able to take out short 10, 20 or 30 year plans and you are able to determine the exact level of cover that this offers.

You may have a 4-year-old son and a partner who has opted to stay at home and look after him. Right now he is dependant on your earning money to feed, clothe and care for him but in twenty years he will have finished school, finished college and hopefully got himself a job. This means he is no longer your dependant and you may not need to make financial allowances for him in your life insurance.

Alternatively, your mortgage may expire in ten years. You won't need to pay to cover your mortgage once it has been fully paid up. See Canadian Mortgage Insurance to learn why you should not buy mortgage insurance from a bank.