Strategic Legacy Building: Navigating Term Life Insurance, Estate Planning, and Identifying Who Needs It*

By March 29, 2024 April 3rd, 2024 Advisor, Blog, Consumer, News

Strategic legacy building is not just about wealth preservation; it is a thoughtful process that ensures one’s assets and values are passed on to future generations in the most effective and meaningful way.

Life insurance offers a straightforward approach to helping provide financial security for beneficiaries. With term life insurance, individuals can make thoughtful decisions today that can forge a lasting impact, and help ensure that their legacy is preserved and continues to benefit their loved ones in the years to come.


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Estate Planning Essentials

Estate planning is a crucial component of strategic legacy building, encompassing a range of essential tools and documents designed to ensure that your assets are distributed according to your wishes while also providing care and protection for your loved ones.1 These are the core elements of estate planning:


A will is a foundational legal document that outlines your wishes regarding the distribution of your assets and the care of any minor children upon your death. It specifies who will inherit your property, who will act as the executor to manage your estate, and who will serve as guardian for any dependents.


Trusts allow you to place assets under the management of a trustee for the benefit of your chosen beneficiaries. Trusts can be used for various purposes, including avoiding probate, protecting assets from creditors, managing estate taxes, and providing for minors or individuals with special needs.

Power of Attorney

This legal document authorizes someone you trust to handle your financial and legal affairs if you become incapacitated. By designating a power of attorney, you ensure that someone you choose can make important decisions on your behalf, such as paying bills and managing investments.

Healthcare Directives

Also known as a living will, healthcare directives outline your preferences for medical treatment in situations where you are unable to communicate your decisions due to illness or incapacity. These directives specify which life-sustaining treatments you would or would not like to receive.

Who Needs Estate Planning?

Estate planning is not just for the wealthy or elderly; it is vital for anyone interested in managing their assets and ensuring their wishes are honoured in the event of their death or incapacitation.

Young Adults

Often overlooked, young adults, even those just starting their careers, can benefit from having basic estate planning documents in place.2 It ensures that their wishes are respected and that their loved ones are provided for, no matter how modest their estate may be.

Parents with Minor Children

For parents, estate planning is crucial for naming guardians for their children in the event of their untimely death, setting up trusts to manage assets for their care and education, and ensuring financial security for their future.3 Without a will or estate plan, the decision of who will care for your children falls to the courts, which may not align with your wishes.

Business Owners

Estate planning is essential for business owners for succession planning, protecting the business’s future, and seamlessly integrating personal and business assets.4 A well-structured estate plan can ensure the business transitions smoothly to the next generation or a chosen successor, minimizing disruption and potential disputes.


As individuals enter retirement, estate planning becomes crucial for delineating how assets should be distributed and planning for potential healthcare needs and end-of-life decisions.5 This can include setting up trusts, updating beneficiaries, and ensuring their estate plan reflects their current wishes and circumstances.

High Net Worth Individuals

Those with significant assets may require more complex estate planning strategies to manage estate taxes, preserve wealth for future generations, and establish legacy funds or charitable contributions.6 Advanced planning can help minimize tax liabilities and ensure wealth is distributed according to the individual’s wishes.

Blended Families

Estate planning can help navigate the unique challenges of blended families, such as distributing assets among biological children and stepchildren and ensuring fair treatment of all family members.7 A clear estate plan can prevent misunderstandings and conflicts among surviving family members.

Individuals with Special Needs Dependents

For families with dependents who have special needs, estate planning is critical for setting up special needs trusts.8 These trusts ensure that dependents are provided for without jeopardizing their eligibility for government benefits, offering financial support and peace of mind.

Understanding Term Life Insurance

Term life insurance is a straightforward and more affordable type of life insurance designed to offer financial protection for your beneficiaries over a specific period, known as the “term” of the policy. These terms are often set at intervals such as 10, 20, or 30 years, providing coverage that meets the policyholder’s needs during critical periods of financial responsibility. If the policyholder were to pass away within this term, the beneficiaries would receive a death benefit—a tax-free lump sum that can help cover funeral expenses, repay outstanding debts, and support ongoing living costs.9

Term life insurance tends to be less expensive than permanent life insurance policies like whole life or universal life due to its finite duration and lack of a savings component or cash value accumulation. This makes term life insurance an accessible option for many people looking for basic life insurance coverage without the higher premiums associated with policies that include an investment aspect. Many term life policies also offer the option for conversion to a permanent policy without an additional medical exam, providing an avenue for those who later decide they want lifelong coverage and a cash value component.10

Estate Planning with Life Insurance

Incorporating life insurance into your estate planning11 is a strategic measure that can significantly enhance the financial security of your beneficiaries. Term life insurance can serves as a cornerstone for providing immediate liquidity upon the policy holder’s passing, which can be critical to help cover funeral expenses, settle outstanding debts, and address estate taxes promptly. It can also act as a tool to minimize the impact of lost income , helping ensure that dependents can maintain their standard of living by covering day-to-day expenses and education costs or offering financial support to the surviving spouse, particularly in families that were heavily reliant on the policyholder’s income.

Integrating life insurance into estate planning can help serve as a solution for paying estate taxes and fees for larger estates, thus preserving the estate’s wealth for beneficiaries. It also provides a means to equalize inheritances among heirs. In scenarios where certain assets, such as a family business or real estate, hold sentimental value or are indivisible, life insurance proceeds can be allocated to specific beneficiaries to ensure a fair and equitable distribution of the estate’s value, mitigating potential conflicts.

Life insurance can be instrumental in funding special needs trusts for dependents with special needs, ensuring they have the necessary financial support throughout their lives without compromising their eligibility for government benefits. It can present an opportunity for philanthropic efforts; policyholders can designate a charity as a beneficiary, enabling a meaningful contribution to causes close to their heart upon their passing.

Contact Canada Protection Plan today to explore your options, get a free quote, or speak with one of our experienced advisors who can help you navigate the complexities of life insurance and estate planning.

Canada Protection Plan is one of Canada’s leading providers of No Medical and Simplified Issue Life Insurance. Our mission is to provide reliable protection and compassionate service from coast to coast with easy-to-purchase life insurance, critical illness insurance and related products. Our expanding product choices will help you get the coverage and peace of mind you need for a better financial future. Canada Protection Plan products are available through over 25,000 independent insurance advisors across Canada.
To learn more about Canada Protection Plan and our line of comprehensive No Medical and Simplified Issue life insurance solutions, call Broker Services at 1-877-796-9090 and we will be happy to assist you or put you in contact with Sales support in your region.

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