Life and Health Insurance
2017 Tax changes: Everything you need to know!
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On January 1, 2017, new contracts issued by SSQ will comply with the new tax rules. Learn more now on the upcoming tax changes by visiting our dedicated web page!
PRODUCT CHANGES
Certain changes to our product features will be made effective January 1, 2017 to comply with the new tax rules.
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Multi-life coverage will no longer be offered for universal life insurance.
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The conversion of multiple term life coverages covering more than one insured into different universal life coverages within the same contract will no longer be possible.
CHANGES TO IN-FORCE CONTRACTS AND GRANDFATHERING
Policies issued prior to January 1, 2017, will be grandfathered under the current tax rules, UNLESS specific policy changes are made on or after January 1, 2017 in which case the new tax rules will then apply. Policy changes that could result in a loss of grandfathering should be considered now, before the start of the new rules, as they may be in the best interest of your client.
Who would benefit from preserving or obtaining a contract governed under the current tax rules?
IMPORTANT DATES
Generally, in order for a contract to be governed under the current tax rules, meaning rules in place prior to January 1, 2017, the date that the policy is approved by underwriting as well as the policy date (or coverage effective date) must be on or before December 31, 2016. All other contracts will be governed under the new tax rules.
REMINDER – LIFE INSURANCE TAX CHANGES
Following a series of measures adopted in the 2012 federal budget, a number of changes will be made to tax rules affecting life insurance contracts, effective January 1, 2017. These changes will have an impact on all contracts, particularly universal life insurance contracts. Prescribed annuity contracts will also be affected.
Overview of tax changes affecting life insurance – Effective January 1, 2017
The changes stemming from the new tax rules are significant. You are advised to contact your clients and to review their current needs. However, these changes will not have a major impact on most clients.
Each case is unique, depending on the financial and tax situation of your client. A separate analysis is required.
NEED HELP?
Contact you SSQ representative or Client Services who will be able to assist you during this important transition period.