Frequently Asked Questions

I’m a stay-at-home parent; why do I need life insurance?

Stay-at-home parents need life insurance for the same reason breadwinners do: Your passing would place a financial burden on your family. What would be the cost of childcare and home maintenance? Would your spouse be able to work at the same level they do now?

Who should I name as beneficiary of my policy?

A beneficiary is the person who is to receive the death benefit of the policy. The benefit can be split among multiple beneficiaries.

There are primary beneficiaries and contingent beneficiaries. A primary beneficiary is the person who will receive the death benefit. Contingent beneficiaries are individuals/trusts who will become the primary beneficiary were the primary beneficiary to pass away before the insured does. A common example is having a spouse as the primary beneficiary and children (via a living trust) as contingent beneficiaries.    

Should I name my children as beneficiaries even if they are minors?

If you want to name your minor children as either primary or contingent beneficiaries, we would not recommend naming them directly. If they receive the death benefit while they are minors, the courts would require a guardian to administer the benefits. This can be costly.

We would recommend talking to a lawyer and having a revocable trust drawn up and naming the trust as beneficiary. The benefit of a revocable trust is you can amend it in the future if you have another child or want to change how payments are made, while the trust itself remains the beneficiary on your policy. In it, you can specify exactly how funds should be distributed.

The other option would be to establish a Uniform Transfer to Minors Act (UTMA) account and select a guardian for it. The UTMA is fine for one child, but inflexible in the future if you have another and want to add them.  

Who should be the owner of the policy?

Either you or your spouse could be the owner of your policy, keeping in mind that the owner is responsible for making sure premiums are paid and has the ability to change payment options or beneficiaries down the line.

Are the premiums deductible for life insurance if they are paid by a business?

For business ownership of a life insurance policy, if the business owns the policy and the insured is the beneficiary, the business can deduct the premium and the insured will pick the premium up as ordinary income on his or her personal tax return.

If the business owns the policy and is the beneficiary, they cannot deduct the premium.  

Would buying a motorcycle and riding it affect my life insurance?

Buying a motorcycle and riding recreationally would not have any effect on in-force coverage or even on new coverage, unless you are racing.

Why do I need to have a medical exam?

Life insurance is medically underwritten and the results of your exam will help determine your premium. The medical exam allows you to qualify for coverage that is significantly less expensive than “guaranteed no exam” insurance based on your physical health.

What should I expect in the exam?

The medical exam is a 30-minute exam which can be done at your home, office, or any other place that is convenient. An examiner will take blood and urine during the exam and ask you about your medical history. Since you will need to fast before the exam, we recommend scheduling it first thing in the morning before strenuous exercise and caffeine consumption.

I just had a physical and had bloodwork done; can I use those results instead of having a new exam?

Unfortunately not. The insurance company will want to check for things that may not have been looked at in your recent bloodwork.