MTHEL131 Lecture Notes - Lecture 5: Life Insurance, Term Life Insurance, York Region Transit
12 Apr 2016
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Permanent life insurance: whole of life, term to 100. Reason is it does not have cash surrender value: endowment. If they die before 65, it pays out. At 65, it pays out at age: pays out policy at maturity date. It charges more than whole life because with whole life, person would keep paying ater age 65. Government program introduced rrsp"s which took away from endowment plan. The cost of insurance is drained out on a daily basis. As long as there is suicient funds in account when cost of insurance is withdrawn, policy stays in force. The deposits into plan can be whatever you want it to be. Can make lump sums, take of making payments for 2 years. The cost of insurance would just increase for the daily basis. Investments the policy holder gets to choose what investments his money is put into.
