Understanding insurance of persons

What is insurance of persons?

Insurance of persons covers people rather than physical property. It includes life insurance, disability insurance, health insurance and, in some cases, annuities.  

In practice, although all these types of insurance are essential depending on each individual’s situation, life insurance is often the first product recommended by advisors, since it can serve as both a financial protection and planning tool.  

That said, the choice of insurance type really depends on your personal situation, needs and goals. Certified advisors in insurance of persons and group insurance of persons are well-positioned to recommend products that fit your financial reality—a reality that is constantly evolving over time.

The benefits of life insurance

Life insurance offers many benefits, including providing beneficiaries with the support they need to cover funeral expenses and mitigate the financial impact of your death.

Inheritance

Life insurance is a good way to leave money to your family and secure the financial future of your loved ones. Since the benefits paid to beneficiaries are generally tax-free, they receive the full amount without it affecting their tax rate.

Savings and investment

Some policies offer a cash value or investment potential. Whole life insurance policies, for example, are tax-efficient because they allow the cash value to grow tax-free. 

Debt repayment

Life insurance can be used to repay your personal and mortgage debts and prevent them from being passed on to your family or estate.

Business continuity

Life insurance can help ensure the continuity of a business, particularly by financing the buyout of a deceased partner’s shares.

Donation to an organization

Life insurance allows you to designate beneficiaries of your choice, including charitable organizations. The funds can therefore be paid out directly and without dispute.