Eight Ways for Canadians to Lower Life Insurance Costs
There are number of factors that impact your life insurance costs. The average Canadian spends close to $58 per month (approx. $700 annually) on e.g. Term Life insurance, which is a significant cost block. This article lays out the main approaches that can be taken to lower your life insurance costs.
It is important to understand what you can do both before and after you purchase your Life Insurance Policy to keep your premiums low without affecting your coverage.
Certified Life Insurance agent, Zael Miransky, from Miransky Wealth Management (Toronto, Ontario) elaborates on the key levers that help to reduce life insurance costs.
You PLAN to get life insurance: What can you do to lower the costs?
Aside from the standard advice to shop around and get multiple quotes, there are number of things that you can do to get lower insurance quotes from life insurers, advises Zael.
1. Apply for the policy while you are young– most Canadians apply for life insurance in their early-to-mid thirties when they are getting engaged or married, or begin having children. Applying for the policy even earlier will often get you better rates in return. According to InsurEye data, Canadians pay an average of $40 per month for a Term Policy with a similar coverage ($250-500k) if they are 31-35 years of age, $47 per month if they are 35-40 years of age, and as much as $64 if they are 51-55 years of age.
2. Be healthy– when applying for the policy. Many insurance customers pay 25% more for their Life Insurance Policy because they are overweight. Staying in shape and maintaining a healthy lifestyle will not only eliminate this extra portion of the costs, but in addition can also result in a discount of up to 25%.
3. Stop smoking–well in advance of applying for a life insurance policy. Insurers will expect to see at least one year without smoking in order to be granted the standard premiums. Otherwise, prepare yourself for premiums that are nearly DOUBLE.
4. Drive safely– Maintaining a clean driving record will be rewarded not only by your auto insurer, but also by your life insurance provider. You can avoid an extra 25-50% of additional costs that result from a poor driving record. Having a flawed driving record with several at-fault accidents can even lead to declining coverage by life insurance companies.
You ALREADY HAVE a life insurance policy: How do you lower its costs?
Surprisingly, many people are not aware of the ability to lower their life insurance costs AFTER purchasing a life insurance policy. The key is to improve your own risk profile, thus, making it less risky for the insurance company. Below are four simple approaches to do it:
1. Stop smoking– If you are able to demonstrate that you gave up smoking and have not returned to it for at least one year, you may lower your insurance costs.
2. Stop drinking– Decreasing your alcohol consumption will positively impact your insurance budget and after one year it will be time to talk to your insurance provider. Having a few glasses of wine each week is not a problem; however, drinking three to four beers a day will not reduce your rates.
3. Lose weight– Improving your physical fitness and health condition can be positively reflected in your life insurance premiums. You not only have the opportunity to reduce your premiums to the normal level, but can also qualify for a ‘Premium Health Customer Discount’ of up to an additional 25% off your life insurance premiums.
4. Keep driving safely – If you received your life insurance policy with a poor driving record, there is a good chance it has increased your life insurance rates by as much as 25% to 50%. If your offenses are three or more years old, these do not concern insurers anymore and you can get your life insurance premiums adjusted accordingly.
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If you are interested in learning about the experiences that other Canadians have had with insurance companies, please visit InsurEye Consumer Experience, an independent platform for consumer insurance reviews. This tool covers most life insurance products and is free for all Canadians.
Zael Miransky is a Life Insurance Agent and Financial Advisor with Miransky Wealth Management.
InsurEye Inc. is a Canadian company that provides independent, innovative online services to help consumers better understand and manage their insurance.
Six issues at the top of tax and finance leaders’ agenda
New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.
According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.
And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.
Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.
Trend 1: Businesses seek more strategic counsel from tax
Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.
According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”
Trend 2: Tipping point for resourcing models
Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.
Trend 3: Digital tax administration is moving faster than expected
in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.
"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."
Trend 4: Data simplification and lower-cost resourcing are top priorities
Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.
At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”
Trend 5: Skillsets are shifting
Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.
Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact
Trend 6: 2020 brought productivity improvements
Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.