Purple Shield Insurance vs other Products | Pros, Cons, Tips

For over 100 years, Purple Shield has been offering life insurance and final expenses solutions in Canada.

In this article we will provide an expert overview of Purple Shield insurance products and address the following questions:

• What products does Purple Shield Offer?
• Pros of Purple Shield products
• Cons of Purple Shield products
• What makes Purple Shield Products unique?

So, let us begin.

Purple Shield’s products are sold through its in-house sales team. The policies are underwritten by Assurant Life. Assurant Life is a member of the non-profit organization Assuris that protects Canadians if their life insurance company fails.

What products does Purple Shield offer?

Purple Shield offers end-of-life products to ensure that beneficiaries are not left with high expenses. The focus of Purple Shield is insurance-funded preneed and final expense solutions.

A range of additional riders can be added as well for an additional cost. An example is a travel assistance rider that helps with numerous final expenses if something should happen to the insured while they are traveling.

Extra money can be put into the plan to help cover extra costs that may occur, such as cemetery expenses, donations, traveling expenses, and other incidentals. Some people choose to put extra money aside, just so their family has immediate financial help.

There are limits to how much money a person can shelter in a single plan, and these limits are impacted by the size of the policy and the insured’s age. Also, the beneficiary on these insurance policies can either be a funeral home or a named beneficiary.

Pros of Purple Shield products

There are several aspects that speak for using Purple Shield products – our experts highlight two in particular:

1. Funeral home assignment

You can assign your plan to a funeral home where you will lock in the price of the funeral at today’s cost. Given the constantly increasing costs of living (and, unfortunately, passing away) this is a meaningful financial decision. This way, you are not worried about funeral planning or burial costs going up in the future.

2. Lack of smoker rates:

The rates for some segments of customers might be cheaper in some cases. For example, male smokers enjoy lower rates as compared to other life insurance plans because Purple Shield does not have smoker rates. Most life insurance companies do increase their rates significantly for both male and female smokers, with insurance costs being almost double of those who do not smoke. Obviously, if you are not a smoker, the odds are not in your favour.

Cons of Purple Shield products

There are several important aspects that one must know about Purple Shield insurance – here are the main ones:

1. Post-claim underwriting:

Purple Shield does underwriting only at time of claim. From one side, it is more convenient when you are buying a policy. From the other side, the risk of your claim not being paid is significantly higher since the insurer did not go through a rigorous underwiring process (i.e. initial risk assessment) and may decide that you have not disclosed a particular health pre-condition.

2. Strict handling of people with diabetes:

With Purple Shield, people with diabetes have a waiting period of two years. Comparatively, Canada Protection Plan and Assumption Life do not have a waiting period. A waiting period means that, if a policy holder passes away during that time, no claim will be paid; just the paid premiums will be returned.

3. High rates for many customer segments

Purple Shield’s rates tend to be higher compared to other life insurance plans, especially for women since the rate for females is the same for men. Typically, life insurance rates for women are significantly lower than rates for men because of women’s longer life expectancy and better health. Also don’t forget absence of smoker rates; that would obviously impact non-smoker rates.

4. Purple Shield is owned by an American company

One does not have to see that necessarily as a negative aspect, but there are cases in Canada where American companies either were not successful or sometimes used questionable practices (e.g. Primerica).

5. Purple Shield products are sold by its own agents

This means that these products are not available through insurance brokers. Buying funeral insurance products from a company’s agents means that you are not able to compare the costs easily to other providers. For example, our brokers have access to over 20+ Canadian Insurance companies completing a true comparison of the market to get you the best and most affordable insurance plan.

What makes Purple Shield Products unique?

Purple Shield puts a strong focus on final expense products. They have a special rider called FDS (Final Document Service).

As described by Purple Shield: “FDS is a pioneer in estate documentation … assisting in the accurate and timely processing of necessary forms and documents after the passing of a loved one, speeding up the time to claim and secure closure, and helping to maximize government and corporate benefits. The customer’s family receives a customized package with a cover letter taking them step-by-step through the signing of the prepared documents. Also included are attached preaddressed stamped envelopes and copies of all correspondence for their files. A complicated and time-consuming process is simplified to assist at a difficult time.”

Final word

Funeral insurance (aka burial insurance, or final expense insurance) is a very important topic that emerges closer to the end of one’s life path. Nearly every Canadian life insurance company offers life insurance plans that can help Canadians to plan financially their life’s end.

Though Purple Shield has a long history in life insurance products associated with end of life, we recommend that you compare, compare, compare. You can decide, then, if a few additional features are worth higher premiums. Our life insurance brokers can do all of the leg work for you if you are searching for a funeral insurance plan / final expenses plan. This way you are able to make an informed financial decision. We look forward to hearing from you.