Life Insurance

How do I know if I have right amount of life insurance?

Life insurance provides a sum of money to survivors that replaces the financial loss caused by the death of a partner or family member. The amount should be a minimum of the sum of all outstanding liabilities, including the mortgage principal, plus an immediate expenses fund, plus an emergency fund. It is also very advisable, once all immediate bills are paid after death, to provide for an income paying investment, to replace the lost contribution of the deceased person to the family.

Sitting down with a CF Insurance Advisor will ensure that a documented Financial Needs Analysis is completed and the appropriate insurance requirement is determined for every individual situation.

There are many different types of life insurance coverage, how does one select?

Large amounts of coverage can be obtained inexpensively through temporary term insurance policies.This typically works very well for young people seeking financial protection for their family in case of unexpected premature death.It is often used to insure the mortgage principal for the family home.

Long term financial plans and effective estate planning in addition to immediate protection are structured with permanent insurance, which provides for certainty of benefit payment at the time of death, while offering principal guarantees and attractive rates of return, with effective tax sheltering opportunities for both individuals and businesses. Permanent insurance is also one of the most efficient savings and accumulation tools available to Canadian families.

The opportunity to achieve outstanding rates of returns for those wishing the independence and flexibility of managing their own investment portfolio, universal life insurance is a form of permanent insurance, which combines insurance protection with an investment portfolio, and is ideal for investors willing to accept market risk to obtain superior results.

Sitting down with a CF Insurance Advisor will ensure that a risk profile is determined to assist matching investment choices, to an investor’s level of comfort with market fluctuations.

What do I want Life insurance to do for me ?

Life insurance can guarantee financial independence to your family or survivors at the time they will need it most;It can be be structured as of the most tax effective retirement plans available in Canada;It can provide some of the highest returns on savings available in Canada while maintaining complete principal guarantees;

It can provide your business with large tax advantaged strategies;
It is the most effective tool available for estate and succession planning;
It is money available when you need it, growing for you when you don’t need it.

Sitting down with a CF Insurance Advisor will ensure that the proper insurance strategies are identified by yourself; we will help you design them to fit your financial goals and objectives, as they relate to you, your family and, potentially, your business.

Retirement Planning

Why prepare a Retirement Analysis today if I am not Retiring for many years?

Retirement planning simply like planning your road map to a destination that you’re dreaming for. The money you save also needs time to grow to the level that it can be able to provide lifetime for you to rely on after your retirement. Financial experts urge Canadian to start planning for retirement as soon as possible, even a
small amount of money in the beginning.

How much will I receive from Canada Pension Plan (CPP)?

As of July – September 2016, the maximum CPP pension amount for age 65 in Canada is $1,092.50. The amount will be adjusted annually in January base on Customer Price Index of the previous 12 months percentage change over the one 12 months period before the previous 12 months. CPP is taxable to the pensioner.

For example: For 2016 CPP amount change:

Average CPI ( November 2014 – October 2015 ) / Average CPI ( November 2013 –
October 2014 ) = CPP Rate Increase in January 2016.

How much will I receive from Old Age Security (OAS)?

OAS is one of pension for all Canadian. There might be a small percentage of Canadian not receiving CPP because he/she was never work in Canada and being a single at age 60. This mainly because CPP needs employee and employer to contribute equally as long as the employee is working in Canada. However, OAS

pension does not require ant contribution but need to have been living in Canada for at least 10 years at age 65. The maximum OAS pension between July – September 2016 is $573.37. OAS is non-taxable income to the pensioner. If you live in Canada for 40 years at age 65 since age 18, you’ll receive the full OAS pension. Otherwise you’ll be receiving a portion of OAS maximum base on the number of years you live in Canada for at least 10 years. The income will adjust 4 times a year ( January, April, July, October )

Employee Benefits

Why should I start an employee benefit plan for my employees?

Benefit plans accomplish three things – they help you recruit, retain and safely retire your employees, making you more competitive in your market.

Benefits are also a tax effective way to compensate your employees, because payroll deductions such as taxes, CPP, EI and WBC are not applicable to your contributions, if you structure your benefit plan correctly.

Can I cover all my employees under an employee benefits plan?

Yes, though insurers usually require that employees work a minimum of 20 hours per week in order to be eligible for coverage. As a business owner, you can set this requirement higher for the group plan. There are individual health and dental solutions to cover employees working less than 20 hours per week.

As an employer, are my premium payments a deductible expense?

Yes, all premium payments by the employer are a tax deductible expense to the corporation.

As an employer, are my premium payments taxable in the hands of my employees?

Yes and no.

Employer premium payments for Life Insurance, Dependent Life Insurance, Accidental Death and Dismemberment and Critical Illness Insurance are deemed income to your employees, and must be reported as such (i.e. taxable benefits). The actual payment of these benefits to the beneficiary are tax-free.

Employer contributions to Short Term Disability, Long Term Disability, Extended Health Care and Dental Care are not deemed a taxable benefit to your employees. However, if you pay any portion of the premium for Short Term Disability or Long Term Disability Coverage, the benefit itself is taxed in the hands of the claimant.
*Where there is premium cost sharing with employees, plans can be structured to avoid these potential pitfalls.

Is group insurance less expensive than individual insurance?

Generally, yes. There are some group plans that are more expensive than individual plans but these are typically plans that have had experienced excessive usage.

May my employees with health issues be covered under a group plan?

As a principle, group insurance is provided to all eligible employees and dependents regardless of their health status. A medical questionnaire is only required for voluntary benefits like Optional Life Insurance and Optional Critical Illness. Also, in some cases, proof of good health may be required for life and disability coverage over a certain amount. There is also typically a     pre-existing condition clause under Long Term Disability benefit (e.g. if an employee is diagnosed or seeks medical attention for a condition in the period 3 months prior to employment, or within 12 months after employment, a disability claim related to that condition will not be approved).

Is there a way to cover health and dental expenses not covered under my plan?

Yes, a Private Health Services Plan (aka Cost Plus arrangement) will allow you to expense items and procedures not covered under your basic group plan, or to cover expenses that exceed the limits of you basic group plan.

I have more than one company. Is there any advantage for me to group them all together under one plan?

Generally, yes. The more employees on a plan, the lower the overall administration costs of the plan and typically the lower the rates. Plans can be set up to accommodate any number of divisions or affiliated companies.