April 6, 2023

Juvenile Critical Illness with Return of Premium

Chris Lubell

Insurance for Serious Illnesses Isn't Just for Adults

The majority of us have either personally experienced or are aware of someone whose family has been significantly touched by a parent receiving a diagnosis of a serious illness. What about though when it involves kids? Unfortunately, childhood illnesses include Type 1 diabetes, congenital heart disease, cerebral palsy, cystic fibrosis, and muscular dystrophy impact youngsters much too frequently.

These types of diagnoses can have catastrophic effects on a family's mental and financial well-being.

Why would having coverage for severe illnesses in children matter?

  • provide money to locate the greatest medical care and treatment for your child, either inside or outside of Canada.
  • enables you to focus on your child's needs without having to worry about: o Working o Additional childcare costs for family members' children o Additional costs related to the sickness.
  • By being ready for an unforeseen circumstance, you'll have the priceless freedom to spend more time with your child without worrying about money.

While the majority of life insurance providers in Canada provide critical illness coverage for adults, not all of them do the same for kids. Among those who do, Sun Life offers a policy that is exceptionally special when coupled with a Return of Premium Option.

What distinguishes Sun Life's Juvenile Critical Illness?

  • adds the aforementioned kid ailments to the 25 adult conditions it covers.
  • Childhood conditions cease to exist at the age of 24, and the insurance automatically converts to an adult plan.
  • When you reach age 25 or 15 years after the policy's start date, whichever comes first, the Return of Premium Option automatically refunds 75% of any premiums you've already paid.
  • After that date, the policy can be surrendered for a reimbursement of the remaining total premiums paid if done so 15 years or later.

What occurs if there isn't a claim?

For their 5-year-old son Michael, Bob and Sally acquire a $200,000 Critical Illness Term to 75 with Return of Premium Rider. The policy's yearly premium is $1,393, of which $462 is allocated to the Return of Premium Rider.

An automatic premium refund at Michael's age of 25 results in a payout of $20,895. This accounts for 75% of all premiums paid thus far. A $462 annual cost for the Return of Premium Rider adds a tax-free rate of return of 7.26% on that portion of the premium.

In Michael's case, he can cancel the coverage at any moment after turning 40 and receive a complete return of all previously paid premiums.

Refund of Additional Premium at Surrender:Ages 40 to 50 cost $27,860, 34,825 and 41,790 respectively.

A particularly special plan that offers assurance if you require the protection and a complete refund of your money if you do not is Sun Life's Critical Illness Insurance plan with the Return of Premium Option for minors.

Call me and I will be pleased to help if you want to learn more about this outstanding plan. Please feel free to use the share buttons to send this post to anybody you think will find it useful.

*- presuming an application for non-smoker rates is submitted at age 18

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