Insurance: A Sophisticated Financial Tool

April 21, 2022 / Insight from Chris Schoonderwoerd, CFP®, Wealth Advisor

Insurance imaged by an alarm clock during a downpour

Wealth Advisor Chris Schoonderwoerd prides himself on ensuring his clients are doing everything possible to not just maximize their wealth, but to protect it: for later in life — come what may, and for after life ends.

“Insurance is a huge part of estate planning and wealth management. It tackles some uncomfortable questions like what happens if you get sick or injured or die — which is why when you first talk to people about it, you often hear back “I’m good, thanks,” Schoonderwoerd says. “When people are open to learning a bit more about insurance, they start to see it’s a very sophisticated financial tool.”

Difficult discussions shouldn’t scare people away from exploring insurance options. It’s a critical part of protecting the money you’ve worked for and the people you care about.

“We have a duty to provide holistic planning to meet your goals and take smart steps to protect your progress. That includes making a roadmap to meet your goals and taking steps to protect your progress,” Schoonderwoerd says.

Wealth advisors can help people determine the type and amount of coverage they need to meet their goals, including things like debt servicing, savings, or income replacement.

Schoonderwoerd says the top insurance categories are health and life.

Health insurance is commonly broken into two categories: disability and critical illness.

“Disability insurance helps replace lost income and pays out for a term until you can return to work. Critical illness pays a one-time, lump-sum payment for particular conditions. It pays out once, and the contract is done,” Schoonderwoerd says.

Life insurance offers more options.

Term insurance has lower initial premiums. It is most commonly sold in 10 or 20-year policies designed to cover temporary costs that go away over time — things like debt repayments, mortgages, the cost of raising kids, or new business expenses. However, longer-term policies can get quite expensive, and most people “leapfrog” into a more permanent insurance product as their temporary expenses fall away, Schoonderwoerd adds.

He recommends most people have some insurance in place by the time they are 60.

Permanent insurance can offer a death benefit or cash value, or both. In addition, some term plans can be converted into permanent plans.

“There are two kinds of permanent insurance too,” Schoonderwoerd says. “Universal offers flexibility to reduce or increase the benefit by adjusting premiums. Whole life offers a guaranteed value, but it can be more expensive.”

Knowing which type of insurance is right depends on several factors, including age, the state of your health, affordability, and whether you own a business.

Schoonderwoerd says people who take the time to explore their options come away with a strong appreciation for insurance and the value of seeking expert advice.

So, the next time someone asks them about insurance, they can say, “I’m good, thanks,” and be sure it’s true.

Chris Schoonderwoerd, CFP®

Wealth Advisor


The particulars contained herein were obtained from sources we believe to be reliable, but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

Insurance products and services are provided by NBF Financial Services (NBFFS). NBFFS is not a Member of the Canadian Investor Protection Fund (CIPF). Insurance products are not protected by the CIPF.

Contact us

Get contact information for our team members and find out where our offices are.