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Canadian Life & Health Insurance Facts // 2024 Edition 22 Glossary L I N E S O F B U S I N E S S Life insurance Term insurance provides cost-effective, temporary coverage. Premiums typically increase over time in five, 10 or 20 year "steps". Term insurance usually provides a right to convert to permanent insurance with the same insurer without further underwriting, providing consumers with the ability to adjust coverage features to address long-term needs. Permanent insurance – such as universal life or whole life – meets life-long protection needs. In addition to death protection, cash values are accumulated and can be used for financial emergencies, or to supplement retirement income. Premiums can be paid over a set number of years or for life. Whole life insurance is a type of permanent life insurance that provides coverage for your lifetime. It has fixed premiums and builds up cash value. Universal life insurance allows consumers to select – and change – premium levels and investment options while the insurer assumes the risk related to death. Health insurance Supplementary health reimburses a variety of expenses, such as prescription drugs, dental, hospital and medical expenses that are not covered by provincial government plans. Disability insurance helps replace lost income due to disability (frequently integrated with public pension plans, workers' compensation benefits and Employment Insurance), usually paying around two-thirds of earnings. Accident & other insurance includes coverage for accidental death and dismemberment, long- term care and critical illness. Retirement solutions Accumulation annuities are a flexible and secure investment product used to build up income to be used later in life. They can be registered as RRSPs, RRIFs, TFSAs, etc., and can be offered through group retirement and savings plans. Pay-out annuities are a type of decumulation annuity that provides guaranteed income for life or over a defined term in exchange for an upfront payment. Segregated funds are a type of investment funds that life insurers offer to provide future income – an annuity. Insurers keep these funds segregated from the company's general assets, so that only investors have access to them.