Is Cover Direct A Good Insurance Company?

Is Cover Direct A Good Insurance Company?

Is cover direct a good insurance company? Cover Direct offers repackaged basic term life insurance underwritten by Canadian Premier. These policies are advertised as low-cost alternatives to life insurance, but they lack key features available with typical life insurance plans, including renewal, convertibility, and the ability to add riders.

Is Cover Direct A Good Insurance Company?

While Cover Direct can provide affordable life insurance, it is limited by a lack of adaptability and convertibility, as well as age-related policy price increases. You may find a better solution than Cover Direct life insurance.

Who is CoverDirect?

Cover Direct is a very new entrant to Canada’s life insurance ecosystem, not operating in the country until 2021. They are a division of Neilson Financial Services, a British insurance brand conglomerate that specializes in “hybrid distribution”. Neilson creates direct-to-consumer brands, such as Cover Direct in Canada, and links them to insurers (accounts payable insurer Canadian Premier in the case of Cover Direct) Neilson has been in business since 2012 and is relatively new to life insurance compared to more established Canadian companies.

Direct Cover: Fast Facts

  • Founded: 2021 (Neilson Financial Services – 2012)
  • Headquarters: Toronto, ON
  • AM Best Rating: N/A (Canadian Premier A [Excellent])
  • Better Business Bureau Accreditation and Rating: Unaccredited
  • Assets: N/A (Canadian Prime Minister $0.2 billion)
  • Annual premiums: N/A (Canadian Prime Minister $27.3 million)
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Who owns Cover Direct Insurance?

Coverage Direct family life insurance is backed by the Canadian Premier Life Insurance Company, which has insured more than 2 million Canadians and has helped protect their families for more than 60 years. You are in good hands.

Coverage Direct Life Insurance Review

Cover Direct also sells term life insurance underwritten by Canadian Premier. They offer these products through a telephone consultation or by completing a quotation form. They offer term life insurance with coverage up to $1.5 million. These term policies are not convertible or renewable. Cover Direct offers supplemental health insurance, but not disability insurance.

Renewability allows a term life insurance policyholder to upgrade their current coverage without having to re-qualify. Convertibility allows a policyholder to trade in term life coverage for a lifetime policy when the term expires. None of these options are available with Canadian Premier policies sold through Cover Direct.

In addition to the lack of options for these two basic aspects of a life insurance policy, Cover Direct does not offer additional life insurance policies – optional add-ons to choose from when applying for traditional term life insurance.

Cover Direct’s main life insurance offering is known as the “Age-Based Policy”. Essentially, it is an annual renewable term life insurance policy. Instead of the standard conditions, this type of insurance is offered year after year, with the premium increasing by the same coverage amount each year.

Cover Direct is a relatively new entrant to the Canadian life insurance landscape, offering its services primarily over a telephone line with no online application option. At this time, we cannot recommend Cover Direct for those looking for comprehensive life insurance.

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Coverage Direct Coverage for Kids

  • Cover Direct also offers child insurance.
  • Limited to $30,000 benefit.
  • Must be purchased before the child turns 17.
  • Benefit in the event of death or contracting the following illnesses or injuries:
  • bacterial meningitis
  • Blindness
  • Deafness
  • Encephalitis
  • Loss of hands or feet.
  • Paralysis
  • Traumatic Head Injury

Benefit:

  • No medical or blood tests are required.
  • Terminal Illness Benefit – Receive your death benefit earlier if you are diagnosed with a terminal illness
  • Lower starting price in the early years of coverage (although rates increase exponentially with age)

Cons:

  • No renewal options (cannot be renewed for another term once cover ends)
  • There are no options for life insurance riders to increase coverage (ordinary riders such as temporary riders, children’s temporary riders, critical illness riders, etc. are not available)
  • Relatively inexperienced in life insurance compared to established Canadian providers
  • No convertibility options for permanent life insurance
  • Rates increase as you age due to the annual renewable coverage structure
  • Handled by phone only
  • There are no options to buy policies after the age of 65

Cover Direct Phone Number

To talk to Direct Cover about your existing policy or to apply to make a change, call their TOLL FREE at 1-844-990-4466. Their Customer Service team is available Monday to Friday from 9am to 8pm ET.

Who sells Cover Direct life insurance?

Only Cover Direct sells your policies underwritten by Canadian Premier. These policies are only available through a phone call to a Cover Direct agent. While you can submit some information on the Cover Direct web portal, the result is an agent calling you to complete the application process.

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How much does a Cover Direct life insurance policy cost?

As mentioned above, Cover Direct primarily sells its age-based policy, an annual renewable term life insurance policy that renews annually at a premium price. Although premiums can be quite low in the first year of coverage, the table below shows how premiums can rise exponentially. Compared to traditional term life insurance, a Cover Direct policy can cost you dearly in the long run.

For example, a 35-year-old non-smoking male would pay $45.30 per month for $1 million in coverage under Cover Direct’s age-based policy. While this may seem like a great price at first, the premium will be $192.70 per month when the policyholder turns 55. Again, while this may seem like a difference of a few hundred dollars, in 20 or 30 years it could cost tens of thousands of dollars for coverage.

Is Cover Direct Life Insurance right for you?

Cover Direct may offer cheap life insurance, but this is due to a lack of flexibility and convertibility, as well as rising premium rates as your policy ages. There may be better options for you than Cover Direct life insurance. As insurance advisors to multiple life insurance companies and products, we can help you decide if Cover Direct is the best option for you or if another Canadian insurer is a match.