September 04, 2021

Popularity of pay-as-you-drive car insurance continues to grow

If you drive infrequently, you could save a bundle on car insurance by paying as you drive, rather than a flat amount for coverage every six months.

U.S. insurance companies have been offering potentially cheaper, pay-as-you-drive plans that, for billing purposes, track when, how, how much and where drivers use their vehicles instead of basing rates on statistics and past trends. The theory is that they can offer lower rates to people who seldom drive and are deemed less risky.

Progressive Insurance introduced the product seven years ago and several carriers now offer it, including at least three that launched versions late last year.

And the idea is gaining traction among consumers, it seems.

More than one-in-three drivers would consider switching from a traditional vehicle insurance plan to one based on when and how much a vehicle is driven, according to a survey conducted by Lynx Research Consulting.

Drivers could save anywhere from 5 to 30 per cent on insurance premiums depending on driving habits, according to analysts.

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July 26, 2021

Hosting a guest in your home may be opening the door to trouble

IStock_000000369764Medium[1]Hosting your home to strangers may be opening a whole new host of problems.

More and more Canadians are participating in home exchanges, hosting guests or even renting out rooms in their homes.

While this may give homeowners an extra little cash in their pockets or even provide an affordable vacation, it may also open the door to unexpected circumstances that are not covered by insurance.

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July 15, 2021

Canada needs to get it right on pension reforms

Policy-makers must start thinking "outside the box" to ensure Canada and Quebec Pension Plan (CPP/QPP) reforms will address projected gaps in future retirement income.

A new study from the Institute for Research on Public Policy (IRPP) reveals that these new reforms, as they stand, will be of little help to the next wave of Canadian retirees.

Michael Wolfson, former chief statistician, Statistics Canada, examines the impact of various options for CPP/QPP in the study Not-So-Modest Options for Expanding the CPP/QPP.

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June 25, 2021

Baby boomers underestimate cost of long-term care: study

Baby boomers have mistaken ideas about the future costs of long-term care and about the years they will spend in retirement, according to a recent Nationwide Financial survey.

When asked to estimate how much a year nursing home care will cost in 2030, they estimated an average of $111,507  -- roughly half the actual estimated costs for that year. However, most correctly estimated current costs at approximately $67,000 a year.

"Nursing home costs have increased more than 4 per cent annually since 1974,” says John Carter, Nationwide's president of retirement plans. "What a year of nursing home care costs today will not even come close to the actual cost when boomers really need it."

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June 17, 2021

Life insurance simply not a top financial priority: study

According to LIMRA research, both men and women are less likely to own life insurance than they were 10 years ago, but the declines were larger for men.

Men are now approaching the traditionally lower ownership rates of women. Thirty-nine percent of men and 43 per cent of women actually have no life insurance coverage at all.

Most notably, middle-aged (35-54) married men are typically in their highest earning years, and half are fathers. Yet, this group had double-digit decreases in the proportion owning individual life insurance from 2004-2010.

And that trend seem to be continuing. People just aren't buying the way the used to. For instance, even though one third of new parents agree they lack suffient coverage, 6 in 10 of tem don’t shop or buy life insurance within two years of the birth, according to LIMRA research.

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May 23, 2021

Looking for lost insurance money can pay off

Millions of dollars in life insurance goes unclaimed each year for one simple reason: the beneficiaries simply don't know the money exists.

Even in this wired age, if the insurance company can't locate the beneficiary — or for that matter, even ascertain that the policyholder has died — that money will go unclaimed, eventually being turned over to the public purse, Consumer Reports reveals

Sometimes it's a communication problem. All too often, however, people buy life insurance and don't let their beneficiaries know about it. But Consumer Reports argues that insurance companies know that policies sometimes go astray and may not be working as hard as they might to find beneficiaries. 

If you know or suspect that a particular insurer underwrote the policy, contact that carrier’s claim office by phone or online. If you don't get a positive response, don't give up. Many companies have an ombudsperson to contact, for instance.

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May 17, 2021

Victoria Day weekend signals the start of summer travel

1414861_51130807It's beginning to feel a lot like summer.

And with the Victoria Day long weekend upon us many Canadians have turned their thoughts to adventure and warmer climates.

Even though there's a lot of excitement about upcoming fun in the sun trips, travellers have three top worries while away: the weather, losing something important and requiring medical attention.

According to a study by BMO Insurance, 83 per cent of Canadians are planning on taking a vacation this summer however, only half actually purchase travel insurance.

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May 08, 2021

Best to be prepared for any emergency

The Boy Scouts motto says it all: Be Prepared.

It's Emergency Preparedness Week May 5-11 and what better time to make sure you're ready for any emergency to protect your family, your home and your business.

Just think of the devastation from hurricane Katrina. Not only did it cause billions of dollars in property damage but it also resulted in the tragic loss of human lives, as well as years of rebuilding lives and communities.

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March 27, 2021

How much are your employee benefits actually worth?

Although they vary sharply across companies, employee benefits are designed to add value to an overall compensation package. Typically, they include things like vacation time, sick days, health and drug plans, disability benefits, life insurance, and retirement plans.

If you're lucky, they might also include items like a car or gas allowance, child-care, employee discounts, education assistance, legal assistance, gym memberships, etc.

But many people find it difficult to place a value on their benefits, preferring instead to focus on salary since it's immediate and tangible.

After all, you can't eat benefits and who says you'll even need glasses down the road?

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January 21, 2022

Are you willing to hit the road without travel insurance?

Most Canadians don’t think twice about the need for car insurance, but many are willing to take the risk of travelling uninsured, according to a survey from American Express Canada.

Only 59% plan to purchase travel insurance prior to taking off on their next trip, which isn't that surprising considering that 30% (42% of those 18 to 34) admit that they’ve actually never purchased such coverage.

What's holding them back? Well, they're not sure whether they're getting a good deal or not (72%), think there's too much jargon and don't understand what coverage includes (66%), and that it's just too complicated to compare one product to another (65%).

And, even when they do buy, it's tough to collect. At least that's what one Toronto man argues, even though he may not have been completely forthcoming during the application process.

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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...