Life Insurance with More Than a Death Benefit: The Value of Complimentary Estate Planning Tools

When people buy life insurance, they usually focus on one question: How much will my beneficiaries receive? It is an important question — but protecting a family involves more than leaving money behind. Who should manage your estate? Who can make financial decisions if you become incapable of doing so? Who should speak for you about personal or healthcare decisions when you cannot speak for yourself?

That is why some Canadian life insurance arrangements include access to complimentary online legal document preparation services as a member benefit, including tools for preparing wills, powers of attorney and healthcare directives.

Life Insurance Is Only One Piece of Estate Planning

Life insurance creates money for beneficiaries after the insured person’s death. A will serves a different purpose. Among other things, a properly prepared will can document how you want your estate handled and identify the person responsible for administering it, subject to the laws of your province or territory. Without appropriate estate planning, family members may face unnecessary uncertainty at an already difficult time.

Life insurance and a will therefore complement one another: one can provide financial resources; the other helps document what should happen to your estate.

What Is a Power of Attorney?

A power of attorney allows you to authorize another person to make specified decisions or act on your behalf, depending on the type of document and provincial law. This becomes particularly important if illness or injury leaves you unable to manage certain affairs yourself.

People sometimes assume their spouse or adult child will automatically be able to handle everything. In reality, legal authority and terminology vary by jurisdiction. Preparing the appropriate documents in advance can make your wishes clearer and reduce uncertainty for the people around you.

What Is a Healthcare Directive?

The terminology differs across Canada, but healthcare or personal-care planning documents can help record your wishes and/or establish who can make certain decisions if you become incapable of communicating or deciding for yourself.

These documents address a very different question from a will. A will primarily deals with matters after death. Advance healthcare and personal-care planning concerns decisions that may arise during your lifetime. Having both can therefore be important.

The Convenience of Online Document Preparation

Estate planning is one of those jobs people can postpone for years. It feels complicated. There is paperwork. There are uncomfortable decisions. And there is always something more urgent to do today. Online document-preparation tools can remove some of those barriers by allowing eligible users to work through customizable documents from home.

One complimentary member service currently available with certain Canadian life insurance coverage provides customizable online tools for wills, powers of attorney and healthcare directives. The documents use information supplied by the member and adjust according to the applicable jurisdiction. That convenience can turn “I really should do this someday” into an actual completed document.

Online Tools Do Not Replace Legal Advice in Every Situation

This point matters. An online document-preparation service may work well for relatively straightforward circumstances, but it should not automatically be treated as a substitute for individualized legal advice.

People with complicated estates, blended families, dependent family members, businesses, property in multiple jurisdictions, trusts or unusual beneficiary arrangements may benefit from speaking directly with a qualified lawyer. The validity and execution requirements for wills, powers of attorney and healthcare-related documents also differ between Canadian jurisdictions. The tool should therefore be viewed as exactly what it is: a useful document-preparation resource, not universal legal advice.

Review Your Documents When Life Changes

Creating estate documents is not necessarily a one-time job. Marriage, separation, divorce, children, grandchildren, buying or selling a business, moving to another province, major changes in assets or the death of a named beneficiary or decision-maker may be reasons to review your arrangements. Your life changes. Your documents should still reflect the life you actually have.

Protection Means More than Money

Life insurance answers an essential financial question: What happens financially to the people I care about if I die? Estate planning asks several more: What do I want to happen? Who should handle it? Who can act for me if I cannot act for myself?

Combining insurance protection with access to tools for preparing a will, power of attorney and healthcare directive can therefore create a more complete approach to family protection. After all, protecting the people you love isn’t only about leaving them money. Sometimes it is also about leaving them clarity.