How do you know if you still need life insurance?

Your need for insurance will change as factors such as your income, investment portfolio and dependants change. Therefore a regular review of your coverage with your financial advisor is important.

Although you may no longer need to provide replacement income for your dependants after your death, life insurance is a useful tool to fund capital gains taxes at death, provide for estate equalization or to pass on a larger inheritance to your beneficiaries. Be sure to name the beneficiaries and not just leave it to your estate. That way, you can avoid probate fees and estate taxes (this applies outside Quebec).

Other types of insurance you may need

Critical illness insurance. This will provide a lump sum payment if you are diagnosed with a critical illness or condition, such as cancer, stroke or a heart attack. You and your family can use the money for daily living expenses, debt payments, and medical expenses and equipment that aren’t covered – easing the financial strain while you focus on recovering.

Long-term care insurance. Failing health can derail even the best-laid plans and quickly erode savings. Our health care system does not cover some of the costs associated with extended long-term care such as nursing home care, rehabilitation and therapy, personal care and homemaking services.

Home and auto insurance. Remember to shop around for home and auto insurance, as you may be eligible for a discount.