In collaboration with Canada’s life insurance experts at PolicyMe.
Let’s be real. Life insurance isn’t something most of us want to spend a lot of time talking, thinking, or learning about.
But many new parents don’t understand how life insurance works, why it’s needed, and how to buy it. I know because as the mom of two boys, I have been this parent. But I can also tell you that securing coverage is something you need to have sorted just in case (morbid, I know, but hear me out).
As a new parent you already have a lot on your mind and are likely sleep-deprived. Here’s how you check the task of securing life insurance off of your to-do list in the span of a nap (which is never long enough).
I’ve asked the professionals at PolicyMe, an online Canadian life insurance provider, to give me the scoop. They’re experts, industry insiders, and most importantly, parents who get it.
Here’s what you need to know about life insurance, how to get a quote online (without leaving the comfort of your couch), and how to secure a policy that’s affordable for you and your family.
What is Online Life Insurance?
and why do you, as a new parent, need it?
Life insurance is a lump sum payment that is offered to your loved ones in the event of your death as long as you make your payments and your death occurs within the lifetime of your contract. This payment is paid out all at once so your family is able to use the money as needed immediately.
I like to equate life insurance for new parents to packing a stacked diaper bag.
Since I have a baby and a toddler I never ever leave the house without my diaper bag. I might not need everything I’ve packed, but I’m prepared for the worst. I’ve got diapers, food, wipes, and a change of clothes for the kids on hand wherever I go.
In the same way, affordable life insurance allows you, as a parent, to feel prepared for the worst. Sometimes that means having your diaper bag packed in case of an impending potty training disaster, and sometimes that means responsibly and seriously planning for the future.
So the question is, how do we make getting a life insurance quote and buying a policy online as easy as shoving a few extra diapers into a bag?
What’s the Best Life Insurance for New Parents?
and how do you get this done without the hassle?
Traditionally, securing life insurance has been a convoluted and overly complicated process that truthfully, no new parent has time for.
It involved physically heading to a meeting or sitting through a lengthy phone call (while your kids demand your attention in the background), dealing with an underwriter (someone who decides if your application should be accepted based on several risk factors), navigating customer service, working with a broker, and depending on your unique health factors, possibly a visit to the nurse.
I don’t know about you, but I’m tired from just reading that lengthy list.
Thankfully, Canadian online provider PolicyMe has taken the unnecessary steps out of the equation. They offer a streamlined digital process that allows you to get a life insurance quote online instantly. Because their services are offered completely online and their advisors aren’t paid a commission, they can pass the savings on to you, making them one of the most affordable insurance companies in Canada. But digital doesn’t mean distant, as you can still get personalized advice online without a phone call or meeting.
You can use the online recommendation tool to see what coverage you may need, get an instant quote, and submit a life insurance application online all while your kids make a mess of your house in the background. You can also get personalized advice from an online advisor (who isn’t paid commission) and sign off on your policy whenever you’re ready.
Where to start with your online policy
- Start with the online recommendation calculator: it will tell you exactly how much you need to spend, so you’re not overspending. It will also honestly tell you if don’t currently need life insurance depending on your unique circ*mstances, which can offer some peace of mind. It takes less than 5 minutes to complete and all you need to do is anwer a few questions about your family, lifestyle, financial commitments, savings, and income.
- Then get an instant quote: this will give you an immediate decision without waiting to jump through bureaucratic hoops. Because everything is done online, you’re not waiting weeks for someone to review and approve your paperwork.
Why Buy Term Life Insurance as a New Parent?
It can be hard to consider an additional monthly expense when you have kids. They’re already very expensive! But, when you have children that depend on you financially (and in every other respect), a mortgage to pay for, and in some cases loans for your business, education, or home, this is actually exactly the time to consider purchasing term life insurance online because you carry these large financial liabilities.
Read more about term life insurance in an easily understandable way here.
Because term insurance offers you coverage when you actually need protection (when kids rely on you) but only lasts a set period of time (during which you’re often at a lower risk of passing away) it’s often a more sensible option for new parents.
But wait, what’s term vs. whole life insurance?
- Who is term life insurance vs. whole life insurance appropriate for? Whole life insurance can sound like it’s better, but it’s actually a whole lot more expensive and in most cases most appropriate for wealthy folks with complex financial situations.
- How long does the coverage last? It’s just like it sounds. Whole life insurance covers you for an entire lifetime, whereas a term insurance plan lasts a set period of time, such as 10, 20, or 30 years.
- Why is term life insurance more common for new parents? Term life insurance is generally more popular amongst young families because it’s more affordable but equally effective. Because term insurance offers you coverage when you actually need protection (when kids rely on you) but only lasts a set period of time (during which you’re often at a lower risk of passing away) it’s often a more sensible option for new parents.
Read more about term vs. whole life insurance explained easily here.
What if I already have coverage through my employer?
I had the same thought when I first began researching whether my family would need to purchase an online life insurance policy. I figured we didn’t need any more life insurance as we already have some through my husband’s employer. In fact, this is quite common. As many as 62% of Canadians have life insurance through their employer. That’s great! Some coverage is better than none. But, you should consider whether the coverage you have through group benefits is actually enough to maintain your family’s lifestyle in the event of death and do the math. Typically your group benefits only pay out one or two times the annual salary.
As many as 62% of Canadians have life insurance through their employer. That’s great! Some coverage is better than none. But, you should consider whether the coverage you have through group benefits is actually enough to maintain your family’s lifestyle in the event of death.
What sounds like a large lump sum may not go as far as previously thought when you calculate monthly bills, debt, childcare, or future education costs. How much would we really need to cover expenses in the event of death?
And what about me? Like many moms, I choose to stay at home and employ myself part-time for the time being, so let’s use me as an example.
I contribute a part-time income to my family, but as I work from home and take care of my two kids most days, I also provide childcare. In the event of my death, not only would my family lose my income, but those childcare expenses would also need to be covered by someone else. Two kids in daycare? That’s a considerable expense. Not to mention, my part-time income would also disappear.
I wanted to consider whether a second policy would be necessary to provide additional buffer room to get my family through a difficult time in the event of my passing. PolicyMe’s online recommendation tool provided me with the answer in approximately 4 minutes. I completed the application in only 15 minutes as all of the questions were available upfront online.
Why now may be the best (and most affordable) time to purchase online life insurance
I never realized that our current policy may not go as far as we previously thought. A second policy could greatly help with funeral costs (which are on average more than $9000), cover childcare, help to pay off debt like our mortgage, and contribute to my children’s future education costs.
And while it may seem odd to purchase life insurance when you’re young and healthy, it’s actually exactly the right time to do it. If you order take-out at least once a month, you can afford a life insurance plan from PolicyMe.
“Rates for younger people — the ones more likely to leave debt behind for young dependents — are especially affordable. For the cost of a single restaurant lunch each month, you can provide a life-changing amount of money for your family in the event that you’re no longer around.”
– Moneywise.ca
Turns out ensuring your family is protected in the event of your passing can be as easy as throwing some extra stuff in an oversized diaper bag. Now that you understand the basics of purchasing term life insurance online, you’ve realized that thankfully, securing affordable coverage isn’t nearly as complicated as it used to be.
Start with the online resources via the buttons below and rest assured that you’ve done what you can to ensure that your family is financially secure and prepared no matter what life throws your way.
Anna
Disclosure:This content was sponsored in collaboration with PolicyMe. All opinions and comments are my own.
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