Universal life insurance is an option that provides permanent lifetime protection with a tax-savings component. This type of policy can be modified over time to fit your lifestyle. Upon the insured’s death, the beneficiaries, estate or corporation will receive the death benefit tax free.
Universal life allows additional deposits into the policy, that are in addition to the cost of insurance, this additional funding is deposited into an investment option where funds may benefit from potential growth on a tax-deferred basis. This allows you to make withdrawals, borrow from the policy account, or use its accumulated savings to help pay insurance costs.
Universal life insurance is an ideal choice for individuals and businesses seeking insurance protection with an investment component.
Whole life and Universal life insurance are customizable with features that can help you meet the following needs:
- Retirement Planning
- Creates a tax-deferred savings opportunity if you have maximized your RRSP and TFSA contributions for the year.
- Business Owner Planning
- Provides protection for your company with additional executive compensation and tax-free funds to the company upon death that may be used to satisfy liabilities or can be distributed to facilitate shareholder buyouts.
- Provides financial options if you are a small business owner.
- Estate Planning
- Provides protection for your family and heirs, as the proceeds from the life insurance can be paid tax-free to your beneficiaries. These funds can then be used to pay capital gains taxes on the final tax return.