IIA | Insurance

Insurance Offerings

The only time to obtain any insurance coverage, be it home, car, health / dental, travel, etc., is before you incur the risk. Some risks are short term in nature whereas others are ever present. IIA offers or provides access to every type of insurance coverage individuals are likely to require in their lives.

Buy The Right Insurance Up Front:

By not planning to have appropriate insurance coverages for each of your major insurable risks (health, disability, critical illness, life) you are effectively deciding to self-insure. Few people however have the financial capacity and flexibility to be able to realistically self-insure for these risks. It is always recommended to outline your personal, assets ownership, and business circumstances to a qualified insurance professional who can help you with a needs analysis identifying various insurance policies that may be strongly recommended for your situation. It is also recommended to revisit this on an annual basis as your circumstances and coverage needs evolve. By doing so, you can rest easy that no matter what happens, you and your loved ones will be reasonably protected.

Health Insurance – how to save money:

• Group health insurance plans offer larger buying power and typically more insurance coverage per dollar of annual premium cost, than personalized health insurance plans, and often do not require personal medical examination.
• If leaving a job, you can usually negotiate directly with the insurance provider within 30-60 days to continue with the same coverage at the same rate as your company had been paying. In addition to keeping an attractive insurance cost locked in, you will not have to re-qualify for the coverage.

Personal Tenancy Insurance Advice:

• Ensuring Adequate Coverage - Some possessions such as jewelry, bicycles, and computers may require a separate insurance rider or schedule to provide the desired level of replacement value coverage.
• Cost Saving Tip - The insurance premium is substantially higher for policies with low deductible than for policies with higher deductible.

Life Insurance Tips:

Show a Healthy Lifestyle:
1. Quit smoking
2. Lose weight
3. Improve diet
4. Visit your doctor regularly (Insurance companies don’t like it when you haven’t seen your doctor for many years).
5. Shop around (Prices and products change frequently. Clients should speak to an insurance specialist when buying an insurance plan, and ensure they’re buying level guaranteed cost. Products with embedded increasing costs are not a good choice).

Commercial Tenancy Insurance – how to save money:

If your lease is up for renewal and you can choose to relocate your business to one of several locations, consider that the premiums for this insurance are lower:
• In a non-combustible concrete or steel framed building than in a combustible wood framed building.
• In a sprinklered building than in a non-sprinklered building.
• In a building with security guard or monitored security system than without.

Auto Insurance – how to save money:

• If you can afford to, pay for your insurance in one annual lump sum instead of monthly payments – it saves you about 9% in financing costs embedded in the monthly payment option.
• If you are able to handle paying a higher deductible in the event of a loss ($500 to $1,000 range), the annual insurance cost of the Collision and Comprehensive insurance can be much lower than it would be if you buy insurance with a low deductible ($200 to $250 range).
• If you have multiple vehicles licensed for your own use (and given that you can only drive one of them at a time), you can save money on your Collision and Comprehensive insurance by bundling that coverage together among your vehicles in an Umbrella Liability Policy.

Travel Medical Insurance – how to save money:

• Various major credit cards provide some aspects of travel medical insurance relating to services purchased with the card (flights, hotels) and possible cancellations / postponements, or extensions of timing that may happen in case of illness or injury of the card holder. Each insurance provider will seek to push claim related cost or sharing thereof, onto any other active provider. You should obtain a Travel Medical Insurance policy that does not unnecessarily double up on insurance coverage already provided through your credit card.
• Some Travel Medical Insurance policies operate on an annual basis and cover the insured person for any trip of up to 60 days duration; if you are expecting to travel multiple times per year this type of policy will save money compared to buying a different insurance policy for each trip.

To buy or not to buy?

• Life insurance although optional for estate planning is generally recommended; it can be used to cover tax liabilities resulting from deemed disposal of the assets of the deceased, so more of their estate gets into the hands of their beneficiaries. The cost of life insurance is lower than the cost of settling the will where the spouse of the insured incurs a tax liability that arises upon the death of the insured person.
• A joint last-to-die policy is a much cheaper way of purchasing life insurance for two spouses or common-law partners than two individual policies. Depending on the age, buying life insurance this way can represent up to a 50% discount.

Commercial General Liability Insurance – how to save money:

•Premium financing as a tax effective payment option:

•The interest on premium financing loans is fully tax deductible (provided that only business insurables and no personal assets are involved);

•Since the insurance premium and interest are both deductible, they can be classified together or separately as an expense, based on the company’s accounting policies;
• Premium financing is considered off-balance sheet because the loans are funded directly through the broker to the insurance carrier. Since a premium finance loan is not a balance sheet liability, it does not impact a client’s external borrowing covenants or capacity to obtain external financing.
•If your lines of business involve several company entities, you can reduce your insurance cost if you set them up to be owned by one parent company as a corporate group rather than independent companies each requiring separate insurance policies.

Resources:

Insurance Quote Request

COC Form

Links:

Mortgage Insurance – how to save money:

• The cost of Canadian Mortgage and Housing Corporation (CMHC) mortgage default insurance can be avoided by home purchasers by putting more than 20% down as a downpayment.
• If your mortgage is through a bank and you need mortgage insurance (to pay off your mortgage rather than your estate having to do so in the event of your death) you should buy it from a separate insurance provider rather than the bank because they will require you to take on a policy with fixed premiums covering the whole mortgage value even though the mortgage principal amount will be progressively paid down under the scheduled payments.

Consider Universal Life Insurance after Age 45

Term Life Insurance is a more cost-efficient option for younger clients. But as age increases, so does the cost of Term Life Insurance, to a greater degree than the cost of Universal Life Insurance. Eventually Universal Life Insurance is cheaper. However, insurance isn’t a commodity clients can get in and out of at will. Clients must qualify medically to be insured, so it is a good idea to transfer from Term Life Insurance to Universal Life Insurance while you are still in good health. In most cases, the cost of waiting – even two or three years – might prove pricier than the original higher cost of Universal Life Insurance over Term Life Insurance. Note also that “evolutionary” insurance policies exist which start as Term Life Insurance but then transfer over to Universal Life Insurance.

Marine Insurance Tips:

• If you may use your vessel for business purposes and get paid for doing so, you have much higher responsibility and liability for the safety of the passengers, than you would have for a private pleasure vessel, and you need a much higher insurance policy as a result.

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