Insurance

Insurance

Insurance is essential to any comprehensive financial security plan. If tragic events like death, disability or critical illness strike, insurance can protect you and your family from undue hardship. Some life insurance policies also provide tax-advantaged savings that you can draw on to achieve goals like buying a house or retiring comfortably.

I have access to a variety of insurance products that can help meet your financial security planning needs. No matter your personal situation—if you’re single or in a family; a professional or a seasonal employee; an executive or small business owner—we will work together to design a customized plan.

 

Life insurance

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People buy Life Insurance to replace a financial loss that would result from a death. For example, a "Bread Winners" future income may need to be replaced. Frequently, Life Insurance is used to create an estate for survivors, or to provide a pool of money to pay income tax owed by the deceased.

The amount you pay to buy Life Insurance is called the 'Premium'. This amount will vary, depending upon:

You must apply for Life Insurance, however once approved, the insurance company must continue to cover you, as long as you pay your premiums.

In the event of a death, a "death claim" is filed. Once approved, a lump sum tax-free amount is paid directly to the beneficiary. If the beneficiary is a person, the payment is made directly and bypasses the estate, and, as a result, avoids probate fees.

Life insurance is frequently used as a tax shelter, as federal legislation permits additional funds to be invested within the policy on a tax-exempt basis. This important tax-planning tool is used to defer or avoid taxation.

The design of proper Life Insurance coverage is an important issue, as part of an individual financial plan. The purchase and implementation of a group benefits package is complex. "Oracle Financial Services has a Chartered Life Underwriter, Chartered Financial Consultant, Registered Health Underwriter and Certified Financial Planners, Elders Planning Council, and Certified Senior Advisor
We can provide you with advice and help you implement the right benefits package for your employees.Key issues to consider when purchasing Life Insurance

The amount of Life Insurance required to provide income for a surviving individual or family depends upon:

  • The amount of income required by each survivor
  • The survivor's Tax Rates
  • The duration over which income will be required
  • Inflation
  • A pre-tax investment return

In addition, capital may be required to pay

  • Final Expenses including burial expenses
  • Probate fees
  • Other debts such as the mortgage on the family home
  • Costs associated with post-secondary education for survivors, and
  • Income taxes upon death

Term Life Insurance

Term life insurance provides coverage for a specified period of time - the term of the policy. Term Insurance may be purchased for a variety of durations ie. 5-year, 10-year, 20-year etc. 
Two important features that may be included are renewability without medical evidence and convertibility to permanent insurance. 
Your policy is paid out only upon death within duration of the term. 
Term life insurance has the lowest price, initially, and it provides temporary protection. 
It provides protection for short term needs. i.e.: mortgage protection, debt elimination, while children are financially dependent on you.

Whole life Insurance

Whole Life Insurance features a level premium and can have increasing death benefit to age 100 with an accumulating cash value that increases over time until it equals the death benefit at age 100. 
Whole Life Insurance covers you for as long as you live. 
Whole Life Insurance pays a tax free death benefit to your named beneficiary and offers you a cash value account with tax deferred accumulation. 
The policy remains in force during your entire lifetime and provides permanent protection for your dependants while building a cash value account. 
The insurance company manages your policy's cash account.

Universal life Insurance

Universal Life is a combination of term life insurance with an investment component attached. 
It is a flexible policy that lets you vary your premium payments and/or adjust the face amount of your coverage. 
The premiums you pay less the cost of insurance, are credited to an investment component within the policy. 
The insurance company manages your investment component.

 

Disability Insurance

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People buy Disability Insurance to replace employment income that has stopped as a result of an illness or injury.

Disability Insurance replaces a portion of monthly income, and can be paid on a tax-free basis.

Payments continue, until recovery occurs, as decided by the insurance company, or the policy completes, or death occurs.

The amount you pay to buy Disability Insurance is called the "Premium". This amount will vary, depending upon:

  • The amount of insurance you purchased;
  • The definition of Disability;
  • Own Occupation
  • Any Occupation
  • Your Job Classification;
  • Your Annual Income;
  • Extent of Coverage;
  • Duration of Coverage;
  • The company you buy insurance from, your age, gender, health, occupation, sporting activities, life style,
  • Whether or not you use tobacco products.

The purchase and implementation of a group benefits package is complex. "Oracle Financial Services has a Chartered Life Underwriter, Chartered Financial Consultant, Registered Health Underwriter and Certified Financial Planners.
We can provide you with advice and help you implement the right benefits package for your employees.

Key issues to consider when purchasing Disability Insurance

Most disability policies will only cover up to 60% of gross income. The 60% maximum approximates net income allowing for a 40% average tax rate. Since the benefits are received tax free if the premiums are paid out of after-tax income, the 60% approximates the amount of earnings at risk. The following are the key issues you should consider:

  • The definition of disability;
  • The elimination period (waiting period)
  • The available monthly benefit:
  • The maximum benefit period; and
  • The renewal provisions.

These elements affect not only the coverage provided by a disability income policy, but also its cost. If cost of coverage s a significant concern, there may be trade-offs because every feature has a cost.

Critical illness insurance

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People buy Critical Insurance to replace income that has stopped as a result of a Critical Illness, and to pay for new expenses that may be incurred as a result of the illness.

Critical Illness is relatively new in Canada. It was invented and first introduced in 1983 in South Africa by Dr. Marius Barnard as a top-up benefit to medical expense policies, and has only recently been available in Canada. Dr. Barnard recognized that many people were recovering from surgeries that in earlier years, would not have been conducted. (His brother Dr. Christian Barnard was a pioneer in heart transplant surgery). The additional life expectancy came with a cost, however, as frequently the patient could not continue to work, and had seriously depleted any savings they may have had to find medical and recovery expenses.

Critical Illness is unlike Disability Insurance, in the following areas:

  • Critical Illness Insurance provides a one-time, lump sum, tax-free cash payment, if you suffer a Critical Illness, and survive for 30 days. Disability Insurance pays a portion of your monthly income, until the insurance company decides that you have recovered.
  • Your doctor, rather than the insurance company, decides whether you have suffered a Critical Illness.

The amount you pay to buy Critical Illness insurance is called the premium. This amount will vary depending upon:

  • The amount of coverage you buy
  • The lump sums available range from $50,000 to $1,500,000
  • The extent of coverage. Some companies offer coverage for more types of Critical Illness than others do.
  • The duration of Coverage
  • 10 Year
  • To age 65
  • For Your Entire Life
  • The company you buy insurance from, your age, gender, health, occupation, sporting activities, life style,
  • Whether or not you use tobacco products. 

Critical illness Insurance proceeds are paid directly to you, on a lump sum, tax-free basis, and can be used for any purpose. Commonly used to pay for:

  • Debts, Loans & Mortgages
  • Alternative Medicine
  • Leaves of Absence
  • Childcare
  • Early Retirement
  • Nursing Care
  • Home Adaptation
  • Occupational Change
  • Job Retraining

Critical Illness Insurance covers some or all of the following conditions, depending upon the insurance company selected:

  • Heart Attack
  • Stroke
  • Coronary Artery Bypass Surgery
  • Loss of Speech
  • Loss of Limbs
  • Deafness
  • Kidney Failure
  • Parkinson's Disease
  • Multiple Sclerosis
  • Blindness
  • Life threatening Cancer
  • Severe Burns
  • Coma
  • Major Organ Transplants
  • Alzheimer's
  • Paralysis
  • Occupational HIV infections
  • Motor Neuron Disease
  • Benign Brian Tumor
  • Aortic Surgery
  • Heath Valve Replacement
  • Loss of Independence

It is expected that 80% of Canadian claims will be for Cancer, Heart Attack or Stroke. Key issues to consider when buying Critical Illness Insurance:

  • Awareness of Canadian Statistics regarding Critical Illness Experience
  • Extent of Coverage varies by Company
  • Definitions and Interpretations of Critical Illness

The purchase of Critical Illness Insurance is complex, and is relatively new in Canada. "Oracle Financial Services has a Chartered Life Underwriter, Chartered Financial Consultant, Registered Health Underwriter and Certified Financial Planners.
We can provide you with advice and help you choose the right Critical Illness i nsurance contract.

Health and dental insurance

Long Term Care Insurance

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People buy Long Term Care Insurance to provide cash to fund the cost of nursing care at home or in a facility. This kind of insurance provides daily benefits to fund new expenses that result from a decline in health and the loss of independence.

A variety of Long Term Health Care options are available:

  • Nursing Homes;
  • Assisted Living Facilities;
  • Adult Day Care; or
  • Community Services.

Some are publicly funded and some require payment by the Long Term Care recipient. Full-time residence in private facilities currently range in price from $2500-$6500 per month, depending on level of care required, daily duration and extent of service provided, etc.

Long Term Care Insurance Benefits are payable when it is determined that health or personal care is needed, usually upon certification by your physician.

Certification could result from injury or sickness, the inability to perform a predetermined number of activities of daily living, a cognitive impairment or any continued service that is required as a result of chronic illness.

Coverage options vary. Long-term care contracts may include some or all of the following:

Eligible Services

  • Adult Day Care;
  • Hospice Care;
  • Respite Care;
  • Medical Equipment; and
  • Bed Reservations.

Daily Living Activity Qualifications

  • Eating;
  • Dressing;
  • Toileting;
  • Transferring;
  • Maintaining Continence;
  • Bathing;
  • Leaving the House;
  • Walking.

Long Term Care Insurance is a complex type of insurance. Oracle Financial Services has agreements with Insurance Companies and Registered Nurses to help you choose the right long- term care insurance for you.

Health and dental insurance

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Many health care expenses, such as dental work, prescription drugs, eyeglasses, private and semi-private hospital room accommodation etc. are not covered by a Government Health Insurance Plan. If you're without an employer group plan, these expenses are paid by you directly. A personal health and dental plan can cover these costs, usually for just a few dollars a day.

Tax savings potential - it may pay for itself

If you're self-employed or are an employee of your own business, health and dental premiums may be a non-taxable benefit and a tax-deductible expense. For others, the premiums may qualify as a medical expense and create a tax credit.

Oracle Financial Services provides our clients with several choices of Health & Dental providers.  The illustration is an example of the savings possible through the utilization of a health and benefits plan.

 

Group health benefits

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While there may be many different options and plan variations available though various group benefits providers, the following are common benefits found in most comprehensive benefit programs:

  • Life Insurance
  • Accidental Death & Dismemberment Insurance
  • Disability Coverage
  • Extended Health Coverage
  • Dental Coverage
  • Health Spending Account

Life Insurance provides your plan members with assurance that their families will be taken care of should they die suddenly or after a prolonged illness. The Life Insurance benefit is most often based on a multiple of the plan member's earnings. However, depending on the plan sponsor's wishes, the benefit may also be a flat amount or a combination of an earnings multiple and a flat amount.

In addition to basic amounts of Life Insurance, additional coverage such as Dependent Life Insurance may be part of a plan.

Accidental Death & Dismemberment Insurance is an additional benefit that can be bought in conjunction with Life Insurance coverage. The amount of coverage is usually equal to the amount of Life Insurance selected by the plan member. It provides plan members and/or their families with additional benefits should the plan members die, lose a limb, become paralysed, or lose their hearing, speech or sight as a result of an accident.

Extended Health Care benefits help plan members and their dependents pay for medical expenses that aren't covered by their provincial plan. Details of exactly what is covered, how much the plan pays, and what the deductible amounts vary among plans. An Extended Health Care package can include a combination of the following features:

  • Hospital care: semi-private hospital room in the plan member's province
  • Prescription drugs: medication prescribed by a doctor
  • Medical services and equipment: private duty nursing, ambulances, crutches, hearing aids, etc.
  • Paramedical services: chiropractors, naturopaths, podiatrists, etc.
  • Out-of-province: emergency travel assistance
  • Vision care: eyeglasses and contact lenses

Dental Care benefits help plan members and dependents pay for eligible dental procedures that are provided by a licensed dental professional. As well as covering preventive and diagnostic treatment, a plan may also cover:

  • Basic coverage, including procedures such as root canals
  • Major coverage, for procedures such as crowns and bridges
  • Orthodontics, as an additional option with Major coverage

Disability benefits are designed to replace lost income in the event plan members become totally disabled for a prolonged absence as a result of illness or accident. To qualify for this benefit while disabled, individuals must demonstrate that they are following appropriate treatment for their illness. Both Short-Term Disability and Long-Term Disability coverage are normally included in a disability benefit plan.

A Health Spending Account (HSA) is an easy, tax-effective way to offer health and dental benefits choice and self-service to plan members.

Plan sponsors deposit HSA credits ("dollars") into each plan member's account every year. The plan member may use the allocated credits as needed for eligible health-related expenses not covered by provincial health plans or by the organization's regular benefits plan. This can include expenses such as:

  • Deductibles or co-insurance payments for health and dental expenses
  • Health or dental expenses in excess of maximum coverage amounts
  • A wide range of other health-related expenses not covered by your organization's health and dental plan that qualify as a medical expense tax credit under the Canadian Income Tax Act

The purchase and implementation of a group benefits package is complex. "Oracle Financial Services has a Chartered Life Underwriter, Chartered Financial Consultant, Registered Health Underwriter and Certified Financial Planners.
We can provide you with advice and help you implement the right benefits package for your employees.

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