MTHEL131 Study Guide - Midterm Guide: Whole Life Insurance, Life Table, Life Insurance
15 Oct 2013
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Primary financial concerns of canadians living too long (insufficient savings) Dying too soon (leaving family in bad financial situation) Becoming disabled (not being able to work) Ability to compete with other firms reputation, ability to keep a promise. Insurance: arrangement where any financial loss encountered will be covered by the policy. Not intended to improve financial condition, just reimburse losses. You can borrow 90% of your policy at a good rate. Policies are unparalleled in safety (claims always get paid) is protected from creditors (beneficiary can"t be sued to settle debt) is complete confidential (unlike will) Not available to individuals in poor health can be difficult to understand cost of premiums reduces current family funds that can be used for consumption or investment. It is valid for the whole of life. Premiums vary based on age of entry. In the case of public calamity, premiums could be increased, payout could be done in installments.
