It’s not easy to raise a family today. As the cost of living rises, education and extracurricular activities for children are becoming more costly. It isn’t easy to make ends meets and still have enough money at the end of each month. To protect your family with life insurance, it is advised to take the life insurance policy as soon as possible.
Today, most families require both parents to work to enjoy the lifestyle they like. Many families would struggle to cope financially if an income source disappeared due to illness or early death.
What Are Your Options To Ensure The Safety Of Your Family Members In Canada?
Family insurance refers to a group of insurance products that protect your family in case of any catastrophe. The below are the types of insurance coverage that are commonly included in family insurance:
- Life insurance protects your family by providing financial resources to replace income, pay off any debt, and fund future school expenses if one of your parents dies.
- The term “income replacement insurance” is also used to describe disability insurance. It compensates for the lost income of a person unable to work due to an accident or illness.
- Critical illness insurance will pay a one-time payment if you are diagnosed with one of the severe diseases.
- Optional riders for children’s term insurance is a children’s life insurance policy that pays if they die before 17.
- Coverage costs typically range between $5,000 and $30,000. The coverage is meant to pay for the funeral of a child. However, it also serves to meet financial obligations during times of grief.
- Full coverage family insurance typically covers both life, critical illness, and disability insurance. If you live in Ontario, you can add the children’s term insurance riders and OPCF44R insurance to your family. The SEF 44 auto coverage endorsement is also available in other provinces.
It may be worth switching the insurance coverage to a first to die policy for your life insurance. This policy covers two people and pays a death benefit if the first one dies. This type of coverage is inexpensive but must be converted into individual insurance if there is a breakdown in the family.
How Much Life Insurance Do I Need?:
If either of you dies, the family will need a lump sum of cash to replace lost income. You should have enough cash to cover the following costs:
- Insurance to pay any outstanding mortgages or debts.
- Sufficient income from the invested money for future school expenses.
- Enough income from investments to replace any lost income.
How Much Does A Family Policy Of Life Insurance Cost?:
Many factors can influence the amount of life insurance you need for your family. These are the main factors insurance companies consider when determining the cost of your insurance.
- Coverage amount and term length
- It is important to consider the health of the insured.
- Critical illness and disability insurance riders.
The cost of family life insurance will depend on how much coverage you need to protect your family in case of the death of either your spouse or yourself. There will be enough coverage to cover your obligations, including your mortgage, and support your family’s education. You may also need to provide care for your spouse.
Your financial situation and life stage will determine the insurance you need to cover all these variables.
Many online calculators can help you determine the right amount of life, disability, and critical illness insurance to purchase for your family. You can find the Full List Here about all the life insurance calculations in Canada.
Here’s The Bottom Line:
Family life insurance should be an essential part of your home budget. It is important to ensure that your family can survive without you. If you are unsure about the insurance type you need, get in touch with a licensed broker, and they will help you get a good deal.