subject: Insurance Broker Canada: The Need Of Life And Health Insurance For The Canadian [print this page] If you live anywhere in Canada you know that we are lucky enough to live in one of the most wealthy and best countries in the world, yet a lot of Canadians do not do adequate financial planning or get insurance advice. Even with the recent economic down-turn, the unemployment rate in Canada was much better than in America, and our banks surpassed the crisis compare to any other country in the world. Canadians still have one of the highest average standards of living in the entire world. Even with economic uncertainty| still out there, Canada shows signs of a solid and stable economy and the capability to become a resource supplier to the world. The future appears bright for Canada and Canadians coast to coast.
With all this flourishing and a promising future, you can consider that financial planning, risk planning and life insurance advice would be a main concern for the average person in Canada. But, in regard to life insurance planning, Canadians are extremely under-insured.
People in Canada are not getting good Life Insurance Advice
Canada has a low average ownership of life insurance. The LIMRA, North Americas premier research organization for the life insurance industry, reports life and health insurance ownership statistics for Canada. The 2009 report showed Canada as having a very low average ownership of life insurance compared to The US at only 55%. Some provinces are much higher, with Quebec having the highest level of life insurance ownership at 63%, followed by Ontario at 59%. Alberta was on of the lowest average life insurance ownership provinces at only 50%.
Probably the uninsured Canadians dont really want personal life insurance since life insurance is covered through their group benefits plans at work. If we were to add all Canadians who owned personal life insurance with those that have some life insurance through work, only 76 percent of Canadians would possess any form of life insurance coverage. That indicates almost one in four people in Canada are wondering around with no life insurance at all. Many of these uninsured Canadians have families who rely on their incomes to provide a comfortable standard of living. They need to get competent life insurance advice, now!
The life insurance funding gap
The average sized life insurance policy in Canada is about $275,000. With Canada's population of 34.1 million, and with 24% of the population having no life insurance, how many people would need to buy at least the average sized life insurance policy to fill this gap in Canadas personal risk protection portfolio?
Lets reduce the number of Canadians to those between the ages of 15 64 (working age Canadians). This is 64% of the population. That means 5.24 million Canadians in their working years are without life insurance coverage (34.1 million Canadians 64% of these 24% of remainder). This works out to $1,441 Billion of life insurance coverage that need to be put in place to protect Canadians who don't have risk protection.
Why the lack of coverage are people in Canada cheap?
People in Canada are costly! They are not willing to risks their familys future to save few dollars a month in life insurance premiums. From personal experience, when sitting down with clients in Canada (and Ive worked in Alberta, Saskatchewan and Ontario selling life insurance), I find them to be very willing to get insurance advice and shell out their hard earned money on personal risk protection plans that make sense. The problem really rests with the Life Insurance Industry in Canada.
There are various factors contributing to the general lack of life insurance advice in Canada.
The average age of insurance advisors in the province is now 57 years old. Many of these agents have built a solid books of business and are living off their existing client base. There is no inspiration to continue to find new clients and make new sale because these aging life insurance brokers are moving into their retirement years.
Insufficient new advisors are getting into the business, and there is a general lack of support when they start. Upwards of 85% of new life insurance brokers/agents joining the industry don't succeed within the first 5 years.
Many effective life insurance brokers in Canada are concentrated on the high net-worth clients, wasting their time and money wooing these clients. Far fewer life insurance brokers/advisors are serving average, middle income Canadians.
Banks in Canada have started to sell insurance through call centres or insurance kiosks, presenting creditor/mortgage insurance or cheap term life insurance. Banks usually offer no in-depth insurance advice or permanent life insurance solutions. People dealing with banks for life insurance coverage are usually also under-insured for their needs.
It boils down to a not having enough advisors across Canada. There just arent enough insurance advisors in Canada, having adequate quality interactions with average Canadians, discussing their insurance and risk management needs. It will become more difficult to find skilled insurance advice as the group of aging life insurance brokers start to leave the industry and release their existing clients. A skilled life insurance broker with experience will become very hard to find. Even today, there are not so many life insurance advisors who are willing to take on middle income clients with limited budgets for life insurance.
Life Guard Insurance can get you professional insurance advice
At Life Guard Insurance we believe in protecting you from any and all risks that life can throw at you. Protecting your family and yourself from risk is our primary concern, and adequate budget, we build in long-term cash values and equity into your plan. We are focused on providing answers to all Canadians, from the middle income family to the wealthy executive and business owner. If you are interested in life and health insurance advice we can link you with one of our many qualified life insurance brokers across Canada.
by: Mitch Reynolds
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