Many people choose term insurance to meet their estate creation needs. Usually, cost plays a big role in their decision. The premiums for term insurance are generally lower than they would be for a comparable amount of permanent life coverage.

Insurance for life. For financial protection that lasts a lifetime, however, universal life (UL) coverage may be a more appropriate choice. A UL policy can provide both the vital protection your family needs today and a solid foundation to meet your changing needs for tomorrow:

A UL plan can be used to cover taxes on family assets, such as a cottage, vacation condo, investment property, or Registered Retirement Savings Plan (RRSP). You can make an insurance bequest to your favourite charity as well, with significant tax benefits. In the year of death and the preceding year, charitable donations can be as high as 100 per cent of net income. The usual limit is 75 per cent of net income. A UL policy offers a tax-effective way to pass on wealth to your heirs. The investment earnings grow on a tax-deferred basis, and the beneficiaries receive the proceeds tax-free. In addition, there are no probate or legal fees to erode the payout. How universal life (UL) works. A UL policy has two parts: life insurance and an investment account. You have the flexibility to adjust premium payments as your needs and cash flow change.

You can increase or decrease your coverage as needed when important events occur, such as starting a family, buying a home, making a career change, or retiring. You can also adjust the investment mix to suit changing market conditions.

A young family with a big need for insurance, for example, can choose a minimum premium option for maximum coverage. As their income grows, they can build on that secure foundation by gradually accumulating earnings within the investment component of their UL policy, where they can grow tax-deferred.

Extra income in retirement. Many professionals use UL to supplement their RRSPs and pensions to meet their retirement income needs. For example, a couple planning to retire in their late 50s can defer tax liabilities on their growing assets and build up their savings with UL.

Those who are self-employed, or whose earnings fluctuate, can make large deposits in peak-earning years and smaller deposits in lower-income years. They can even use the growth in the investment component of the policy to cover the insurance premiums.

Call your Investment Planning Counsel Representative for an analysis of how much insurance you need to protect your loved ones and your life's plans.

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This report is written by Investment Planning Counsel, a fully integrated Wealth Management Company. Mortgage services provided by IPC Save Inc. Mutual Funds available through IPC Investment Corporation and IPC Securities Corporation. Securities available through IPC Securities Corporation, a member of CIPF. Insurance products available through IPC Estate Services Inc.