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BEYOND BASIC PROTECTION

March 9, 2026

The Strategic Role of Insurance in High-Net-Worth Planning

For high-net-worth (HNW) investors, insurance can play a far more strategic role than simply providing protection. With greater wealth comes more complex structures, broader objectives and, often, a desire to ensure that hard-earned success creates a lasting impact. The right insurance strategy can help achieve all of this—enhancing tax efficiency, preserving estate value and supporting family and philanthropic goals.

Here are some ways that the needs of HNW investors are unique and why they deserve special attention:

Estates are often more diverse and may require tailored planning for liquidity or protection. Wealth among HNW families is often spread across investment portfolios, real estate holdings or private companies, which may present unique challenges when it comes to estate planning. Life insurance can provide the liquidity needed to cover taxes or equalize inheritances when certain assets—like a business or cottage—are passed through generations. It can also simplify estate settlement by bypassing probate and transferring proceeds privately, a benefit valued by many HNW families who prioritize confidentiality and efficiency for their heirs.

Tax efficiency becomes increasingly important as wealth grows. As wealth grows, so does tax exposure—making insurance a useful tool for improving tax efficiency. Permanent life insurance can serve as a tax-advantaged investment vehicle: the cash value within the policy can grow on a tax-deferred basis, and the death benefit is generally paid out tax-free. At death, many estates face significant capital gains taxes due to the deemed disposition of assets. Using insurance strategically can help offset those liabilities and preserve more of your estate for beneficiaries or charitable causes.

For many HNW individuals, wealth planning isn’t just about preserving capital—it’s about shaping a legacy. Life insurance can play an integral role in supporting future generations, protecting vulnerable family members or funding philanthropic efforts. Some families choose to use permanent life insurance as a long-term estate planning tool to help secure a child’s future financial security, as the cash value inside the policy can grow on a tax-deferred basis and be used for various purposes throughout the child’s life (subject to tax implications). Parents or grandparents can transfer ownership of the policy to the child when they reach adulthood, and death benefits are generally paid out tax-free to beneficiaries, making it an efficient way to transfer wealth across generations. Others use insurance-funded trusts to provide ongoing care or support for loved ones, while maintaining flexibility and control over how funds are distributed.

Insurance may help to enhance portfolio diversification and tax efficiency once traditional tax shelters are maximized. Most HNW investors have maximized tax-advantaged accounts like RRSPs and TFSAs, with additional assets often held in taxable, non-registered investment accounts. For investors seeking greater efficiency, permanent life insurance can offer an attractive complement to traditional portfolios. Participating whole life policies, for instance, offer the potential for tax-deferred growth and a guaranteed death benefit—features that can improve after-tax returns, particularly when compared to low-yield fixed-income investments. In this way, insurance can act as a conservative, tax-efficient asset class that complements investment portfolios by providing an element of diversification.

Business ownership brings unique protection, succession and liquidity challenges. HNW business owners often face complex questions about how to protect partners, transition ownership and ensure family fairness in succession. Insurance can play a role—for example, replacing income in the event of the death or disability of a key person, providing liquidity to facilitate ownership transitions, funding buy-sell agreements and preventing forced asset sales. When held within the
business, corporate-owned insurance may also offer tax efficiency by allowing death benefits to flow through the company’s capital dividend account, enabling tax-free (or tax-advantaged) distributions to shareholders and helping preserve wealth for future generations.

Integrating Insurance Into the Bigger Picture
For HNW investors, insurance should be viewed as a strategic planning tool—one that can support and even enhance protection, growth and legacy objectives. When thoughtfully integrated, insurance not only safeguards wealth but also enhances the efficiency and flexibility of an overall wealth plan. I/We can help you explore how a customized insurance strategy can strengthen your broader wealth plan and create lasting value for generations to come. For a deeper discussion, please call the office.

The information contained herein has been provided for information purposes only. The information has been drawn from sources believed to be reliable. Graphs, charts and other numbers are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. This does not constitute a recommendation or solicitation to buy or sell securities of any kind. Market conditions may change which may impact the information contained in this document. Wellington-Altus Private Wealth Inc. (WAPW) does not guarantee the accuracy or completeness of the information contained herein, nor does WAPW assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Before acting on any of the above, please contact your financial advisor. Transactions of the type described herein may involve a high degree of risk, and the value of such instruments may be highly volatile. Such risks may include without limitation risk of adverse or unanticipated market developments, risk of issuer default and risk of illiquidity. In certain transactions prospective investors may lose their entire investment or incur an unlimited loss. This brief statement does not disclose all the risks and other significant aspects in connection with transactions of the type described herein, and prospective investors should ensure that they fully understand the terms of the transaction, including the relevant risk factors and any legal, tax, regulatory and accounting considerations applicable to them, prior to transacting. The information contained herein may include the opinions of representatives of third-party companies or organizations and may not necessarily reflect that of Wellington-Altus (WA) or its representatives. All third-party products and services referred to or advertised are sold by the company or organization named. While WA may have referral arrangements with some third-party companies or organizations, WA does not specifically endorse any of these products or services and is not liable for any claims, losses or damages however arising out of any purchase or use of third-party products or services. All insurance products and services are offered by life licensed advisors of Wellington-Altus Insurance Inc. or other insurance companies separate from WAPW.

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The opinions contained herein are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Wellington-Altus Private Wealth. Assumptions, opinions and information constitute the author’s judgement as of the date this material and subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance. All third party products and services referred to or advertised in this presentation are sold by the company or organization named. While these products or services may serve as valuable aids to the independent investor, WAPW does not specifically endorse any of these products or services. The third party products and services referred to, or advertised in this presentation, are available as a convenience to its customers only, and WAPW is not liable for any claims, losses or damages however arising out of any purchase or use of third party products or services. All insurance products and services are offered by life licensed advisors of Wellington-Altus.