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CNBC Vedio: Whole Life as Alternative to the Stock Market
Participating Whole Life Insurance as an Asset Class
Balancing to Reduce Risk
Whole Life Insurance for Children

Jake Jun Qiao, Certified Financial Planner (CFP), Chartered Life Underwriter (CLU), Member of Million Dollar Round Table (MDRT). Please contact me for any financial planning inquires.


Position: Home - Life Insurance hello - WARTROZ FR - Participating
Whole Life Insurance for Children

Protection and flexibility for a promising future

Setting aside money for children or grandchildren is smart planning. A key requirement is a solution that offers access to money when needed. Other important factors are stability, security and growth of assets. With a myriad of choices available, it can be hard to determine the most appropriate one to meet your needs.
Participating life insurance may be an option to consider. It provides more than a death benefit – it also has a cash value that grows inside the policy, which can be accessed in the future.
See how a participating life insurance policy works for Todd, Leanne and their granddaughter, Olivia.
Meet Todd and Leanne
• Proud grandparents of eight-year-old Olivia
• Know a head start on a savings plan will help create the type of future they want for Olivia
• Already funding Olivia’s registered education savings plans (RESPs)
• Beyond RESPs, they’re thinking of other events and opportunities where Olivia will need money – likely at times when her income may be limited.
Todd and Leanne both lost their parents and saw first-hand the effect not enough life insurance coverage can have on a family. They purchased life insurance on their own children and also want to know Olivia will have life insurance coverage to last her lifetime. They know if Olivia were to develop health problems, it could jeopardize her ability to get coverage.
Todd and Leanne’s advisor has told them a participating life insurance policy could provide both life insurance coverage and access to cash when needed. They want to learn more.

A Closer Look

Todd and Leanne consider some of the costs Olivia may have in the future. They recognize some key events could happen at times when income is limited.
Todd and Leanne want to ensure Olivia has enough money to pursue all her dreams and aspirations.

More Than a Death Benefit 

Participating life insurance provides permanent life insurance protection with a cash value component that can grow tax-advantaged inside the policy. This cash value can be accessed once, or several times during Olivia’s life.

How It Works

After considering possible expenses Olivia may face, Todd and Leanne decide to purchase a $100,000 20 participating life insurance policy for her. They purchase this policy because it has great long-term cash value growth and is contractually paid up after 20 years. There’s also potential to end out-of-pocket payments even sooner through a premium offset option.
They’ve added a benefit to allow for increases in coverage as Olivia’s life insurance needs increase. Already showing signs of being an outdoor enthusiast, activities like rock-climbing, scuba-diving or even travel to certain countries are all lifestyle choices that could affect Olivia’s insurability. Adding this benefit when the policy is first purchased means even if she’s eventually considered a higher risk and potentially uninsurable, she can still increase her coverage. Plus, this policy and benefit allow for permanent life insurance protection, with the added benefit of policy cash value that grows throughout Olivia’s life.
When Olivia turns 18, Todd and Leanne plan to sign the policy over to her. They will remain irrevocable beneficiaries. This way, the policy cannot be surrendered for its cash value without their consent. By signing the policy over to her, before withdrawals are made, future tax implications would also be Olivia’s responsibility. However, there are no tax implications on the transfer of ownership itself. 1
Todd and Leanne are happy with the flexibility of the participating life insurance policy. Looking at the long-term growth in cash value, Olivia could even use the money to enhance her retirement income, if needed.

Beyond RESPs 

In the past 10 years, tuition fees at Canadian colleges and universities have more than doubled. Based on the 2010 and 2011 school year, Statistics Canada reports the average tuition per year was $5,128. This is over $20,000 for a four-year program, just for tuition. This number doesn’t consider accommodation, living expenses, books, recreation fees or social activities. Students can easily graduate university with $40,000 to $50,000 of debt*.
RESPs are a good start, but will they be enough, and will they provide enough flexibility?
Participating life insurance is a great complement to RESPs. It provides life insurance protection for children or grandchildren, and a cash value component that can grow and be accessed to afford them more opportunities in life.
 Simply dial 416-835-8805 for details.


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