Can someone with Alzheimer’s or dementia get life insurance?

Most Canadians want to protect their family and provide for them financially, even if the worst were to happen. But how can someone do that when they’re dealing with a disease that might cause them to forget their family members entirely? This is one of the complex challenges faced by many people who become diagnosed with Alzheimer’s disease or dementia.

Nearly 600,000 people in Canada were living with dementia in 2020 (Alzheimer Society of Canada). By 2030, it’s expected that close to 1 million Canadians will be diagnosed with the disease. It’s no surprise, then, that 56% of Canadians are concerned about getting dementia. Especially when big-name stars like Bruce Willis have shown that this serious illness can affect anyone.

So, how can someone with Alzheimer’s or dementia make sure their family’s finances are protected no matter what? Life insurance is one way, but what kind of options do they qualify for? We’ll take a look at the details in this article.

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Can you get life insurance if you’ve been diagnosed with Alzheimer’s or dementia?

Yes, a person with dementia can still get life insurance, even if they have Alzheimer’s disease. It’s tough when someone has a serious illness like this, and it can be emotional for them and their family. But the good news is there are usually choices for life insurance, even in the most severe situations.

The exact type of insurance policy someone with a serious illness can get depends on their unique circumstances. Life insurance companies will want to know:

  • Your current age
  • How old you were when you were diagnosed
  • How many months/years it’s been since you were diagnosed
  • How severe your illness is
  • What kind of treatment you’re taking
  • Your family history (for instance, do you have relatives who had dementia or passed away as a result of the disease?)

Most people with dementia will qualify for guaranteed acceptance life insurance, which we’ll talk more about below. Although, someone a bit younger and in the early stages of Alzheimer’s, or some other form of dementia, may have more coverage options than someone whose illness has already reached an advanced stage. It all depends.

It’s best that you speak with a licensed insurance advisor who can review your situation and recommend the life insurance options that would match your budget and needs.

What is Alzheimer’s?

Alzheimer’s is a disease that affects the brain and makes it hard for people to remember things, think clearly, and behave like they used to. It’s a difficult illness for both the person who has it and their family because it can make them forget important things. People with Alzheimer’s may have trouble doing everyday tasks, remembering their own name, or even recognizing their friends and loved ones.

Dementia, including Alzheimer’s disease, doesn’t have a cure right now, which makes it an especially tough illness for families to go through. It is a “progressive disease”, which means symptoms get worse over time.

People with dementia can be more likely to get other serious illnesses, like pneumonia. The disease can even lead to premature death. There are medicines that can help control the symptoms and slow down how fast the disease gets worse. This helps to give the person suffering from the disease a chance to live their life as normally as they can after being diagnosed.

Quotes Icon Author Photo
Diarmuid Shiels
Life insurance advisor, LLQP
Someone with dementia can still get life insurance. Guaranteed acceptance plans can offer coverage, even for the most complicated situations.

What causes Alzheimer’s?

Alzheimer’s is thought to be caused by a buildup of too much protein in the brain, which disrupts normal brain activity. But no one knows for sure exactly why this happens to start with. Some experts think it may have something to do with someone’s genes, the environment they live in, and their lifestyle (Cleveland Clinic).

What is the life expectancy of a person diagnosed with Alzheimer’s

People with Alzheimer’s disease are expected to live another 8-10 years after being diagnosed, depending on how old they were when they got the disease. But there are many cases of people living another 15-20 years with treatment.

Are Alzheimer’s and dementia the same thing?

Alzheimer’s and dementia are similar, but not exactly the same. Alzheimer’s is a type of dementia, which means it’s one of the many ways dementia can happen. People sometimes use the words “Alzheimer’s” and “dementia” to mean the same thing, but Alzheimer’s is considered one of the more serious types of dementia.

What is dementia?

Dementia is not actually a specific disease on its own. Rather, it’s an umbrella term for brain-related health issues that affect things like memory and reasoning. When someone has dementia, it means their brain doesn’t work as well as it used to. They might have trouble remembering things, thinking clearly, or figuring out solutions to problems.

Quick facts about dementia

1. It’s often hereditary, meaning it’s usually passed down from parent or grandparent to child. But not always.

2. It usually affects people age 65 or older. Early-onset dementia can affect people as young as 40 years old, but it’s pretty rare.

3. There are multiple types of dementia. Some of the most common types are:

  • Alzheimer’s disease: Most people with dementia are diagnosed with Alzheimer’s. In this case, an unusual amount of protein in the brain prevents it from working properly.
  • Vascular dementia: This type of dementia happens when there’s not enough blood flowing to the brain. It can happen after a stroke, which also happens when not enough blood flows to the brain. Vascular dementia affects memory and can also affect physical coordination.
  • Lewy body dementia: Like Alzheimer’s, Lewy body dementia is also caused by too much protein in the brain. But its symptoms are different. It can also cause memory loss, hallucinations, and trouble with physical movement.
  • Frontotemporal dementia: This type of dementia affects the front part of the brain. Instead of memory loss like other forms of dementia, this type can cause changes in someone’s personality and behaviour.
Most existing life insurance policies do cover dementia or Alzheimer's as a natural death.

What kind of life insurance can someone with Alzheimer’s/dementia get?

A person with dementia may have to choose guaranteed acceptance life insurance. But let’s look at the three most common types of coverage and whether each would be feasible for someone with Alzheimer’s or dementia.

1 Traditional Life Insurance

This is the standard life insurance that most people get. But someone with Alzheimer’s or dementia likely will not qualify for it. This kind of insurance asks a lot of health-related questions and might even need you to go through a medical exam.

Many companies will not give regular life insurance to someone who already has a serious disease. Or, if they do approve the application, they may give a rating, which means they would ask for much more money than usual for a life insurance policy.

Based on our in-house research and our experience working with more than 30 of Canada’s best life insurance companies, many providers will not give regular life insurance to someone who has been diagnosed with Alzheimer’s or dementia. But, thankfully, this is not the only option.

2 Simplified Life Insurance

Simplified issue life insurance policy is a type of no-medical life insurance and can be a good option for those with pre-existing conditions. These policies do not ask you to take a medical exam, and they have fewer health questions than regular life insurance does. They’re also more likely to accept people with health issues. But people with dementia may not qualify for it.

Even though simplified issue life insurance is more flexible, there’s still a chance the company might say no to someone’s application. Or, if they say yes, there’s still a chance that they might not offer as much coverage or for as long of a time period.

3 Guaranteed Acceptance Life Insurance

Guaranteed acceptance or guaranteed issue life insurance is just like it sounds – it guarantees that you will get insurance coverage. It does not ask any medical questions, so you’ll definitely be approved. However, even though the name sounds good, this type of policy has some downsides you need to know about:

– Price
It’s by far the most expensive form of life insurance of the three options discussed in this article.

– Survival period
It also has a two-year waiting period where anyone who’s approved has to live for at least two years after the policy starts. Otherwise, the company will not pay the death benefit to the insured person’s loved ones if they pass away within the first 24 months. Although, they may give back the premiums that had been paid up until that point.

– Limited coverage
Even though you may be approved easily, you’ll have fewer options for how much insurance you can get. For example, if a company only agrees to provide $50k in coverage, you might have to buy multiple policies from different providers to get as much coverage as you need. This can end up being fairly costly.

– Limited type of policy
There are two main types of life insurance: term or permanent. Term lasts for a specific number of years while permanent lasts for the rest of your life. Term life insurance is much more affordable. But with some guaranteed acceptance policies, you can only get permanent life insurance.

– No riders
Traditional life insurance can often allow extra add-ons called “life insurance riders“ that allow you to get more coverage for more things. But guaranteed acceptance policies do not have this option.

This type of policy may be the only possible life insurance for seniors with dementia because they’ll definitely be approved.

What's the difference between simplified and guaranteed life insurance?

If you’d like to speak to an expert who knows the ins and outs of the industry and can give insight into the different options, you can always contact us. We’re happy to provide tailored advice that will help you make the right choice for your family.

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Is Alzheimer’s or dementia covered by existing life insurance?

Yes, if someone already has life insurance, their policy will cover death caused by dementia, like Alzheimer’s. So, if they were to pass away because of dementia, their loved ones would still receive the money from the insurance policy. Insurance companies consider it a natural death, so they would pay out the death benefit.

Frequently asked questions

Will getting diagnosed with Alzheimer’s or dementia affect life insurance prices?

It depends on whether you already have life insurance or not.

If you already have a life insurance policy:

  • No, it will not affect your premium costs
  • Once your coverage starts, your price is locked in — even if you are diagnosed with a serious illness later down the line

If you do not have life insurance already:

  • Yes, it will affect what type of coverage you can get and how much your life insurance premiums will cost

If you already have life insurance but you’re looking to buy a new policy:

  • Yes, it will affect what type of coverage you can get and how much your life insurance premiums will cost

How much life insurance should someone with Alzheimer’s or dementia get?

In general, you should get 10-12 times your annual income in life insurance coverage at the very least. But, it also depends on what you plan to use your death benefit for. For example, someone with a serious disease like dementia might use life insurance for planning end-of-life expenses such as funeral costs. Meanwhile, someone with young children might use their policy for making sure their children are provided for until they reach adulthood. So, the right amount of coverage will vary.

Here are some factors you should consider:

  • Financial obligations
    Do you need your policy to cover outstanding debt like a mortgage, student loans, or credit card debt?
  • Income replacement
    Does your spouse or family need your income to continue living comfortably? If so, think about how much money they would need from your life insurance to replace your lost income.
  • Estate planning
    Do you want your life insurance to be there as something of a nest egg for future generations? This applies more to permanent life policies than term, but it can still affect how much coverage would work best.

Another thing to keep in mind is that policies that aren’t regular insurance, like guaranteed acceptance or non-medical, can offer lower coverage amounts than traditional life insurance policies. Most of us dream of being able to get $1 million in life insurance coverage for our family. But you may only realistically be able to qualify for $50,000, depending on what type of life insurance you get and how much coverage the company agrees to give you.

You can use our life insurance needs calculator to help you pinpoint how much coverage would work for your situation. Or, you can chat with our friendly advisors to find out.

Check out PolicyAdvisor's life insurance calculator.

Is Alzheimer’s or dementia considered a mental illness?

No, dementia and Alzheimer’s disease are not considered mental illnesses. Even though they affect the brain and how we think, they are different from mental illnesses like depression or anxiety. Doctors treat them as separate conditions because they are caused by physical changes in the brain, rather than by chemical imbalances in the brain like mental illnesses are.

Is Alzheimer’s or dementia considered a disability?

It depends on factors like how bad the dementia is and how well treatment is going. Some forms of dementia, including Alzheimer’s disease, could be seen as a disability if the symptoms make it hard for someone to do daily activities normally.

This is also the case for disability insurance, which replaces a part of your income if you become disabled in either the short or long-term. Each company has their own rules for what counts as a disability. So, companies will look at each individual situation to decide if they will cover dementia or not. But this is only for people who already have disability insurance before they get are diagnosed with dementia.

Someone who already has dementia would probably not be able to get new disability insurance. Most companies would tell them no.

Is Alzheimer’s or dementia considered a terminal or critical illness?

Yes, Alzheimer’s and dementia are considered critical illnesses and are covered under most enhanced critical illness insurance policies. This type of insurance pays out a tax-free lump sum if you are diagnosed with a serious and life-threatening disease.

However, dementia is not usually seen as a terminal illness. This is because people who are diagnosed with dementia can often live for decades longer. So, the disease is usually not covered under policies for terminal illnesses, such as the Accelerated Death Benefit rider. This rider provides a portion of the death benefit early if the insured person is diagnosed with an illness that leaves them with less than 12 months to live. Because those with Alzheimer’s can live for much longer than 12 months, it would not qualify.

But, someone who already has the illness may not be approved for critical illness insurance or terminal illness riders. Or, if they are approved, their policy might list Alzheimer’s or dementia as an exclusion that will not be covered. In that case, they may consider guaranteed acceptance critical illness insurance, which would cover other critical illnesses except their Alzheimers (as it is a pre-existing condition).

Get one-on-one help

Not everyone’s situation will be the same, so there’s no one-size-fits-all coverage option for someone who has been diagnosed with Alzhemier’s or dementia. The best way to get the life insurance you and your family need is to speak with one of our licensed advisors who can help you come up with a customized solution for your coverage needs.

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What is the Extreme Disability Benefit Rider?

You likely already know the importance of life insurance: it is extremely beneficial for your family when you pass away. But what about those tough financial times that can arise when you are still alive? If you were unable to work due to severe disability, would your family still survive financially despite your loss of income? 

An Extreme Disability Benefit rider is an additional benefit that you can add to your life insurance policy. It provides a financial payment if you’re in a state of “extreme” physical disability. Insurers might define “extreme disability” differently, but it commonly includes the inability to bathe, eat, or dress on your own — among other challenges.

At PolicyAdvisor, we have significant experience helping Canadians understand whether they need an extreme disability benefit rider as part of their life insurance coverage. We can also find alternatives that could better fill the gaps in one’s needs.

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What is a life insurance rider? 

A life insurance rider is an optional feature added to your policy to better address your unique insurance needs. Insurance riders typically require an additional premium payment, which is added to your monthly premium. Some riders may also be included at no extra cost.

 Learn more about life insurance riders.

What is the Extreme Disability Benefit Rider

How does the extreme disability benefit rider work? 

The extreme disability benefit rider is a form of accidental death benefit. It provides an advance payment of your life insurance payout in the event of an extreme physical disability. For instance, it could be either 50% or 25% of your death benefit, up to a maximum of $250,000. The payment is made after a pre-determined waiting period that varies by insurance provider.

The extreme disability benefit rider provides you with extra funds in your time of need. Your ailment might mean you can no longer earn income to support your family. Additionally, your household might need to enlist Disability Support Services or hire extra help, depending on the nature of disability. They may even need to adjust your living environment, such as by purchasing accessible vehicles or installing stairlifts due to your health status. 

This rider isn’t to be confused with disability insurance or critical illness insurance, although all of these typesof coverage can help in the event of loss of income due to illness or injury. The extreme disability benefit rider provides partial benefits in the form of a lump-sum advance on your life insurance payout.

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How extreme disability is defined

Statistics Canada has estimated that around 22% of the population has some form of partial or permanent disability. But the definition of extreme disability varies among service providers. Some use “Severe Loss of Independent Existence” to measure extreme disability. Severe loss of independent existence occurs when you’re diagnosed with a total inability to perform four out of six daily living activities without assistance. 

These daily activities include:

  • Bathing: Washing yourself 
  • Dressing: Putting on or removing clothing, braces, artificial limbs, and other surgical appliances 
  • Toileting: Getting on and off the toilet and performing personal hygiene tasks
  • Bladder and Bowel Continence: Managing bladder and bowel function with or without a protective undergarment or other appliance to maintain hygiene
  • Transferring: Moving to and from a bed, chair, or wheelchair
  • Feeding: Eating or drinking 

After you receive a diagnosis of extreme disability from a specialist, your insurance company may have a waiting period of 90 to 180 days before providing the advanced payout.

Who offers an extreme disability benefit rider? 

Beneva (formerly SSQ Insurance) and UV Insurance provide two of the most popular extreme disability benefit riders with their life insurance policies. 

Beneva Insurance

Beneva offers flexible life insurance coverage that reaches a maximum benefit of $10,000,000. They provide terms of 10, 15, 20, 25, 30, 35, and 40 years. Their life insurance policies generally include the extreme disability benefit for free. 

Beneva’s extreme disability benefit provides the perks mentioned earlier in this article. Before the age of 60, 50% or 25% of the initial insurance amount may be payable in advance, up to $250,000, if you face a state of extreme disability for at least six months. 

Read our full review of Beneva Insurance’s term life insurance. 

 

UV Insurance

UV Insurance provides a form of the extreme disability benefit rider as an integral part of their T-20 Superior+ policy and other products. This rider provides 50% of the insurable amount, up to $100,000, if you face a severe loss of independent existence before your 60th birthday. The benefit is paid after 90 consecutive days of severe loss of independent existence.

Read our full review of UV Insurance’s term life insurance. 

The extreme disability benefit rider differs from standard disability insurance policies.

Extreme disability rider vs catastrophic disability rider 

A catastrophic disability rider usually comes as part of or as an optional add-on to disability insurance policies. Catastrophic benefits give extra coverage in addition to your disability policy’s monthly benefits payout. This rider is primarily an income replacement option. It allows your disability insurance benefit to replace 100% of your prior income instead of only partial benefits.

Is it possible to add a rider to an existing life insurance policy?

There’s no straightforward answer here. Whether you can add a rider to an existing life insurance or disability policy depends on your insurer and your policy’s terms and conditions. It could further vary between riders. 

Adding a rider to an existing application often requires submitting a new application. You may have to take a medical exam or submit an Attending Physician’s Statement (APS) to qualify. 

Dropping a rider from your policy is much easier than adding one. Your insurer generally won’t need additional information, so it’s commonly a matter of filling out an application or informing your insurer of your wishes. After you drop the rider, your insurer adjusts your premiums accordingly. 

If you’re interested in a life insurance policy with an extreme disability benefit or another rider, our expert advisors can help. We can assess what life or disability insurance policies are right for you. Schedule a call with one of PolicyAdvisor’s insurance experts today and learn more about our competitive rates and coverage options.

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Best Whole Life Insurance Companies in Canada (2024)

The best companies for whole life insurance in Canada include Manulife, BMO Insurance, Sun Life, Empire Life, Desjardins, and more. The one you should choose depends on your needs.

Our expert advisors have ranked the top 15 Canadian whole life insurance providers to help you find the perfect match. We’ve ranked them based on the best for performance, the best for added features, the best for children’s policies, and more.

Keep reading to see our ratings and reviews of the best companies for whole life insurance in Canada!

Want to do more research first? Learn the whole life insurance basics.
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WHAT IS
WHOLE LIFE INSURANCE?

Whole life insurance is a type of insurance policy that lasts for your entire life.

Whole life policies provide your beneficiaries with a tax-free death benefit, plus they have a built-in investment component that generates cash value you can use in your lifetime. Some policies also pay dividends.

Most people get whole life insurance to cover long-term needs like paying final expenses or managing future estate taxes.

Question mark

The best whole life insurance in Canada 2024

Our team at PolicyAdvisor.com has spent years studying the industry to bring you a list of top companies with the best offerings in different categories.

The following reviews are a must-read for anyone thinking about purchasing whole life insurance. They will help you decide the best options for you and your family.

Full list: 15 Best Whole Life Insurance Companies in Canada – March 2024

Read our ratings and reviews of the best whole life insurance Canada.

Reviews: Our Top-Rated Whole Life Insurance Companies

Find the top Canadian life insurance companies for whole life coverage using our ratings and reviews. Read them below.

PolicyAdvisor Rating

Best For Quick Issue

AM Best Rating A-

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Assumption Life Whole Life Insurance Review

Canada’s best whole life insurance for:
Quick-issue policies

Assumption Life Insurance wins the award for its potential for a fast-issue policy with no doctors or blood tests. They don’t ask you to do a medical test if you’re 18-45 and if you want whole life insurance coverage up to $999,999. This is sometimes called accelerated issue policies.

As you get older, they may not give you accelerated issue for as much coverage. But you can still get up to $50,000 without a medical exam up to age 69.

But that’s not the only reason Assumption came out on top in our rankings. They offer two types of coverage: one that pays dividends (participating) and one that doesn’t (non-participating). If you choose the participating policy, you have 5 options for how you get dividends, and you can change your options every year.

They also offer extra options called life insurance riders to help you add more coverage. And, if you want a plan without answering any medical questions at all, they also offer non-medical plans.

Read our Assumption Life Term Life Insurance reviewRead our Assumption Life Critical Illness Insurance review
Assumption Life Whole Life Insurance Product Details
Product name:

Assumption Life ParPlus (participating)

Assumption Life ParPlus Junior (participating)

Essential Whole Life (non-participating)

Limited pay:

20 years or until age 100 (participating policies only)

Dividend options:

Cash dividends, cash accumulation, enhanced coverage, premium reduction, paid-up additions

PolicyAdvisor Rating

Best for Complimentary Additional Features

AM Best Rating A

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Beneva Whole Life Insurance Review

Canada’s best whole life insurance for:
Complimentary additional features

Beneva whole life insurance products are a good choice if you want a whole life policy that includes additional benefits. Their plans have all the usual benefits included in a whole life insurance plan. But their plans can also:

  • Cover multiple lives — up to 5, depending on the plan
  • Include 4 benefits free of charge to give you additional coverage: Extreme Disability Benefit, Disability Waiver of Premium Benefit, Accidental Death & Dismemberment (AD&D) Benefit, and Accidental Fracture Benefit
  • Have 2 rider options, which can give you extra coverage at a low price: Critical Illness Insurance Rider and Child Rider

They give you several payment options if you want to finish paying your life insurance premiums early. And you can get policies without a medical exam with their simplified or guaranteed plans.

Most of Beneva’s plans are life insurance with cash value but not dividends. But they do offer Universal Life Insurance, which is a permanent life insurance plan that pays out dividends but comes with a higher risk.

Read our Beneva Term Life Insurance reviewRead our Beneva Critical Illness Insurance review
Beneva Whole Life Insurance Product Details
Product name:

Whole Life 20

Whole Life 100

T-100

Limited pay:

Life pay, 20-pay

Dividend options:

N/A

PolicyAdvisor Rating

Best for Non-Participating Plans

AM Best Rating A

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BMO Whole Life Insurance Review

Canada’s best whole life insurance for:
Non-participating plans

Bank of Montreal (BMO) is a great choice for people who want whole life insurance with cash value and aren’t too concerned about getting dividends.

Their policies are all non-participating, so you don’t get dividend payments. But you get cash value and a yearly Performance Bonus that you can use similarly to how you would use dividends.

BMO Insurance also gives you A LOT of choices for how to handle your life insurance costs:

  • Premium switching, which lets you change your premium payment period
  • Premium offset, where you can stop paying premiums and have them deducted from your paid-up cash value instead
  • Additional payments, where you can pay extra premiums to increase the death benefit and cash value
  • Policy loans, where you can borrow against your cash value
Read our BMO Term Life Insurance reviewRead our BMO Critical Illness Insurance review
BMO Whole Life Insurance Product Details
Product name:

Estate Protector

Wealth Accelerator

Limited pay:

Life pay, 10-pay, 20-pay

Performance bonus options:

Paid-up additions (automatic), premium offset

PolicyAdvisor Rating

Best for Charitable Giving

AM Best Rating A+

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Canada Life Insurance Whole Life Insurance Review

Canada’s best whole life insurance for:
Charitable giving

Canada Life’s My Par Gift is the perfect plan for people who want to leave a lasting impact by donating to charity. This whole life policy was created just to help you do that.

You just pay one tax-advantaged lump sum premium of $10,000 and the policy is locked in. The charity receives the policy’s cash value and dividends, which they can then use however they need to.

Once you pass away, the charity receives the full death benefit. This means you can help the charity and its work for more than a lifetime.

Read our Canada Life Term Life Insurance reviewRead our Canada Life Critical Illness Insurance review
Canada Life Whole Life Insurance Product Details
Product name:

Wealth Achiever Plus

Estate Achiever Plus

Canada Life My Par Gift

Limited pay:

Life pay, 10-pay, 20-pay

Dividend options:

Cash dividends, premium offset, paid-up additions

PolicyAdvisor Rating

Best For Non-Medical Plans

AM Best Rating N/A

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Canada Protection Plan Whole Life Insurance Review

Canada’s best whole life insurance for:
Non-medical coverage

Canada Protection Plan is a great option if you want whole life coverage without taking a medical test. The plans are non-participating, so you will not get dividends. But they’re still straightforward, affordable life insurance policies that can give you at least $10,000 in coverage.

Their plans are also good for funeral insurance. This type of insurance covers expenses related to the end of life, such as funeral costs or any remaining debts.

CPP gives you a wide range of coverage options if you have health isssues, so your chances of finding a plan that fits your needs are very high.

They also have regular policies for people who are healthy and who want quick approval.

Read our Canada Protection Plan Term Life Insurance review
CPP Whole Life Insurance Product Details
Product name:

Guaranteed Acceptance Life

Deferred Life

Deferred Elite Life

Simplified Elite Life

Preferred Life

Preferred Elite Life

Limited pay:

20-pay, pay-to-100

Dividend options:

N/A

PolicyAdvisor Rating

Best for Paying Off Premiums Early

AM Best Rating N/A

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Desjardins Whole Life Insurance Review

Canada’s best whole life insurance for:
Paying off premiums early

Desjardins gives you some of the best options to pay off your policy early so you only have to pay it for a certain number of years. This is called limited pay, and Desjardins is one of the only Canadian companies that lets you pay it off in as little as 5 years.

You pay higher yearly or monthly premiums for those 5 years only and then you don’t have to pay anything else for the rest of your life. Or you can choose to pay in 10, 20, 15 years, or until age 100.

When you choose limited pay, you can rest easy knowing you have lifetime protection, cash value growth, annual dividends, and no more bills!

Desjardins’ plans also come with a lot of benefit options you can add on for even more coverage. They offer basic plans without dividends, and a special permanent life policy for seniors 50+ who don’t want to take a medical exam.

Read our Desjardins Term Life Insurance reviewRead our Desjardins Critical Illness Insurance review
Desjardins Whole Life Insurance Product Details
Product name:

Desjardins Basic Permanent Life Insurance

Estate Enhancer

Accelerate Growth

5 Pay Par

Limited pay:

Life pay, 5-pay, 10-pay, 20-pay (par plans)

Life pay, 10-pay, 15-pay, 20-pay, pay-to-65 (non-par plans)

Dividend options:

Paid-up additions, deposit with interest, cash dividends, premium reductions, enhanced coverage

PolicyAdvisor Rating

Best for Balanced Performance

AM Best Rating A

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Empire Life Whole Life Insurance Review

Canada’s best whole life insurance for:
Balanced performance

Empire Life’s whole life product, EstateMax, is a great option for people who want to build wealth in the long term and increase their life insurance payout. They don’t give the highest cash values in the Canadian market, but they’re far from being the lowest.

This is a good choice if you want steady, secure growth — especially the longer you have your policy.

Their Optimax plan is also designed specifically for people who plan to retire soon and want to access their plan’s cash value in the policy’s first 20 years.

Empire’s policies can be just as affordable as some Term-to-100 policies. It’s no wonder they’re one of the most popular choices for whole life coverage in Canada.

Read our Empire Life Term Life Insurance reviewRead our Empire Life Critical Illness Insurance review
Empire Life Whole Life Insurance Product Details
Product name:

Empire EstateMax

Empire Optimax Wealth

Solutions 100 with Cash Values

Limited pay:

Life pay, 8-pay, 10-pay, 20-pay

Dividend options:

Annual premium reduction, cash accumulation, cash dividends, enhanced coverage, paid-up additions

PolicyAdvisor Rating

Best Mutual Company

AM Best Rating N/A

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Equitable Life Whole Life Insurance Review

Canada’s best whole life insurance for:
Mutual values

If you specifically want to work with an insurance company that is partially owned by the people who have insurance with them, Equitable Life may be the right choice for you.

This is called a mutual company. This kind of business doesn’t have to answer to stakeholders or market pressures like other carriers do. They can sometimes offer more competitive rates on insurance as a result.

There are other insurance mutuals, like Beneva and Wawanesa. But we feel their strongest points are in other areas, so Equitable takes the cake in this category.

Equitable only offers whole life policies that earn dividends, and their cash values can grow quite well in the long run.

Read our Equitable Life Term Life Insurance reviewRead our Equitable Life Critical Illness Insurance review
Equitable Life Whole Life Insurance Product Details
Product name:

Equitable Equimax

Estate BuilderEquitable

Equimax Wealth Accumulator

Limited pay:

Life pay, 10-pay, 20-pay

Dividend options:

Annual premium reduction, cash accumulation, cash dividends, enhanced coverage, paid-up addition

PolicyAdvisor Rating

Best for Smokers

AM Best Rating A

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Foresters Financial Whole Life Insurance Review

Canada’s best whole life insurance for:
Smokers

If you’re planning to quit smoking, wouldn’t it be better if someone was paying you to do it? Foresters Life Insurance doesn’t exactly give you money, but their Quit Smoking Incentive Plan is a great motivator.

Smokers usually get charged more for life coverage, or they can be denied completely. Foresters Financial offers the opposite. They give you lower rates if you commit to stop smoking within 2 years.

That’s more air in your lungs, more money in your wallet, and lifelong coverage that your family can rely on!

All of Foresters’ plans give you cash value, and some also pay dividends. Plus, they have a wide variety of life insurance options for people who have health issues.

Read our Foresters Term Life Insurance reviewRead our Foresters Critical Illness Insurance review
Foresters Whole Life Insurance Product Details
Product name:

Foresters Non-Par

Advantage Plus

Limited pay:

10-pay (Advantage Plus only), 20-pay, pay-to-100

Dividend options:

Paid-up additions, cash, deposit, premium reduction, enhanced coverage

PolicyAdvisor Rating

Best for Health Accommodation

AM Best Rating A+

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Industrial Alliance Whole Life Insurance Review

Canada’s best whole life insurance for:
Health accommodation

If you have health issues, you should seriously consider Industrial Alliance (iA) for your insurance needs. They have something called a Superior Risk Tolerance Program, where you’re more likely to get approved even if your health isn’t in peak condition.

You can get a participating or non-participating plan, and they give you a lot of flexibility. You have options like:

  • Limited pay options to pay off your premiums early
  • Cover up to 9 people under the same policy
  • Optional life insurance riders and benefits to add to your coverage
  • Pay premiums semi-annually, instead of monthly or yearly like most providers

Of course, many Canadian companies also offer no-medical insurance — which we rated Canada Protection Plan as the best in. But if you want standard coverage despite health concerns, iA is a great choice too.

Read our iA Term Life Insurance reviewRead our iA Critical Illness Insurance review
iA Whole Life Insurance Product Details
Product name:

Whole Life Insurance

iA Par

Child Life & Health Duo

Life and Serenity 65

Limited pay:

Life pay, 10-pay, 20-pay, pay-to-65

Dividend options:

Paid-up additions, cash dividends, deposit with interest, annual premium reduction

PolicyAdvisor Rating

Best for Overall Performance

AM Best Rating A+

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Manulife Whole Life Insurance Review

Canada’s best whole life insurance for:
Overall performance

There’s a reason why Manulife is one of North America’s largest life insurance companies. They’re quite successful and most of their products are high-quality. In Canada, their whole life plans are no different.

If you want all-around good performance that you can rely on, Manulife is a great choice. They offer both participating and non-participating plans, and plans that don’t make you take a medical exam.

You get all the standard benefits of a whole life policy with Manulife. And, they even give you the option to change your mind and choose a different payment option if you like.

Choose Manulife if you’re not really looking for anything specific but need a policy that checks all the boxes:

  • Affordable
  • Flexible
  • Reliable
  • Robust investment options
  • Good amount of coverage
  • And more!
Read our Manulife Term Life Insurance reviewRead our Manulife Vitality Term Life Insurance reviewRead our Manulife CoverMe Life Insurance reviewRead our Engineers Canada Manulife Life Insurance reviewRead our Manulife Critical Illness Insurance reviewRead our Manulife Mortgage Protection Plan review
Manulife Whole Life Insurance Product Details
Product name:

Manulife Par

Manulife Par with Vitality Plus

Performax Gold

Limited pay:

Life pay, 10-pay, 15-pay, 20-pay, pay-to-90

Dividend options:

Paid-up additions, cash dividends

PolicyAdvisor Rating

Best for Children's Plans

AM Best Rating A

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RBC Whole Life Insurance Review

Canada’s best whole life insurance for:
Children’s plans

If you’re looking to buy the best whole life insurance for children, Royal Bank of Canada (RBC) Insurance could be a great option.

They have a special feature called the Juvenile Guaranteed Insurability Benefit that will give children a financial leg-up once they grow up. This benefit acts like a Hall Pass for your child or grandchild. When they reach adulthood, they can buy a new policy or add more insurance to their plan without having to take a medical test or go through any hassle to get approved.

Many other companies will give you the option to buy this kind of benefit — but RBC includes theirs for free! This is why we have to recommend them for whole life insurance policies for children in Canada.

Their plans are great for other uses too, like estate planning or just long-term financial planning in general.

Read our RBC Term Life Insurance reviewRead our RBC Critical Illness Insurance review
RBC Whole Life Insurance Product Details
Product name:

RBC Growth Insurance

RBC Growth Insurance Plus

Limited pay:

Life pay, 10-pay, 20-pay

Dividend options:

Paid-up additions, cash dividends, premium reductions, dividends on deposit, enhanced coverage

PolicyAdvisor Rating

Best for High Net-Worth Individuals

AM Best Rating A+

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Sun Life Insurance Whole Life Insurance Review

Canada’s best whole life insurance for:
High net-worth individuals

The more you earn, the more insurance you’ll likely need. You’ll want to choose a provider who you know can provide those high amounts of coverage, and Sun Life Insurance is exactly that choice.

Sun Life is another one of Canada’s largest life insurance providers. They offer a minimum coverage amount of $250K, which is way higher than the $10,000 or less some other providers start with.

They offer plans with just cash value (non-participating) and plans with both cash value and dividends (participating). Plus, even if you have health issues you can apply for their plans that don’t ask you to take a medical exam.

Read our Sun Life Term Insurance review
Sun Life Whole Life Insurance Product Details
Product name:

Sun Spectrum Permanent Life Insurance II

Sun Permanent Life

Sun Par Accelerator

Sun Par Protector II

Sun Par Accumulator II

Limited pay:

Life pay, 8-pay, 10-pay, 15-pay (Sun Permanent Life only), 20-pay

Dividend options:

Cash dividends, cash accumulation, enhanced coverage, premium reduction, paid-up additions

PolicyAdvisor Rating

Best for Long-Term Growth

AM Best Rating N/A

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UV Whole Life Insurance Review

Canada’s best whole life insurance for:
Long-term growth

If you want an insurance policy that can give you a LOT of growth over years, UV just might be the right pick for you. They just came out with a new Whole Life High Values plan in 2022 (fairly recent for insurance!) that promises your patience will pay off.

If you keep the plan until you’re 65, your cash value growth could be as much as 50% of what your original coverage amount was with this high-performance plan. That’s no small figure!

UV also gives you life insurance options if you have health issues. But UV’s plans are all non-participating, so you won’t get any dividend payments from them.

Read our UV Term Life Insurance review
UV Whole Life Insurance Product Details
Product name:

Whole Life High Values

Whole Life Pay to 100

Adaptable

Limited pay:

Life pay, 20-pay, pay to age 25, 35, 45, 55, 65, 75, or 85 (non-par only)

Dividend options:

N/A

PolicyAdvisor Rating

Best Value for Guaranteed Benefits

AM Best Rating A

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Wawanesa Whole Life Insurance Review

Canada’s best whole life insurance for:
Value for guaranteed benefits

Most investments involve some level of risk. Not so with Wawanesa! They offer high cash values that you can access early on if you need to, especially if you pay the policy off in 20 years.

With Wawanesa, there’s a very good chance you will “break even” — have a higher cash value than the entire amount of premiums you paid to the company in those 20 years or less!

They give you more insurance coverage and have some of the lowest whole life insurance quotes in Canada. It’s no surprise that they’re one of the most affordable options people choose.

You get to choose between a participating or non-participating policy, or one that doesn’t make you take a medical exam.

Read our Wawanesa Term Life Insurance review
Wawanesa Whole Life Insurance Product Details
Product name:

Wawanesa Whole Life

Limited pay:

Life pay, 20-pay

Dividend options:

Paid-up additions

More choice. Lower price.
PolicyAdvisor saves you time and money when comparing Canada’s top whole life insurance companies. Check it out!
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Methodology: How did we come up with the rankings?

We determined the top-ranking whole life companies in Canada based on industry knowledge, the hands-on expertise of our advisors, and factors like:

  • Financial strength ratings
  • Policy details
  • Key features
  • Premium costs
  • Coverage amounts
  • Cash value growth potential
  • Dividend options
  • And more

We’re all about helping Canadians get the coverage they need. Use this list as a guide to which whole life insurance is best for you and your family, based on your specific needs.

You can find Canada’s best whole life insurance quotes on our website in minutes. Or, contact us and let our experts help you out one-on-one.

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What’s the difference between participating and non-participating life insurance?

  • Participating

Participating or par is a type of whole life insurance policy where you earn cash value AND dividends.

 

  • Non-participating

Non-participating or non-par type of whole life insurance policy where you earn cash value only — you DO NOT get dividends with this type of policy.

Why should I get permanent life insurance Canada?

There are 3 very good reasons why you should get permanent life insurance:

  1. To cover your final expenses
  2. To access cash value now/during retirement
  3. To plan your estate

1 Covering end-of-life expenses

You can use permanent life insurance to make sure your family doesn’t have to go into their pockets to pay for your final expenses in life. If you happen to pass away before paying any bills, your family can use your whole life policy to take care of it.

2 Accessing cash value

Cash value grows over time, and you can use it in many ways — as supplemental income in retirement, as collateral for a loan to buy a home, or any number of other ways. 

Cash value is one of the key differences between term vs whole life insurance.

💡 Learn more about how to access cash value.

3 Estate planning (estate taxes)

The best permanent life insurance policies can also be used to pass on your planned inheritance to your loved ones without them having to pay taxes. The death benefit or insurance payout is tax-free, so the final amount they get won’t be lower.

💡 Learn more about estate planning with life insurance.

Of course, you don’t need to fit into just these categories to get permanent life insurance quotes. Most people can benefit from whole life insurance in Canada one way or another!

If you’re unsure, speak with an advisor or insurance broker to find out if a permanent plan can work for you.

Talk to a licensed professional

We hope our ratings and reviews of the Best Permanent Life Insurance Canada were helpful to you. If you have any questions or need any help, don’t hesitate to contact us!

Book some time with our licensed advisors to make sure you’re getting the right plan for you and your family’s financial security.

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The Cheapest Life Insurance Quotes in Canada – Updated 2024

Many Canadians want the cheapest life insurance policy that still has the most coverage. We do love our bargains, after all! And in this inflating economy, everyone wants to do their best to get the best deal we can!

Insurance is no different. But getting a cheap life insurance policy depends a lot on each person’s current situation. In this article, we’ll show you some real quotes of how affordable life insurance can be. And, we’ll give you insider tips on how to get the lowest rates possible.

Click here to skip straight to the quotes.

WHAT IS
TERM LIFE INSURANCE?

Term life insurance is a type of insurance policy that covers you for a specific period or “term”.

Term lengths are usually 10-40 years, or until age 65 (when you retire). You can customize your term to match specific needs, like the length of your mortgage or until your children reach adulthood.

Term life insurance has a low cost because it’s temporary. It’s also flexible and easy to understand.

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What is the cheapest life insurance policy?

In general, the cheapest life insurance is term life insurance. The way term life insurance works is that you get coverage for a specific period of time. This is different from other types of policies that can cover you for your entire life or come with investment options.

Term life insurance premiums are cheaper:

  • The shorter the length of time you’re covered for
  • The lower amount you’re covered for
  • The younger you are
  • The healthier you are

For example, a 20-year-old who doesn’t smoke and buys only a basic policy will have some of the cheapest life insurance quotes in Canada.

The average cost for term life insurance is around $22 to $25 for a young, healthy Canadian under 40 years, says Senior Life Insurance Advisor Jason Goveas. The cost depends on age, so prices increase the older you get. But even a 40-year-old can expect to pay around $28 for a 10-year policy.

What are the lowest term insurance quotes?

Term insurance in Canada can cost as little as $20 or less for a basic plan. It depends on your age and other details. But, generally, life insurance in Canada is a lot more affordable than most people realize.

As Canada’s best online insurance broker, we work with more 30 of Canada’s best insurance companies. We’ve gathered real-time quotes from leading life insurance providers to show you how low rates can get. Check out the chart below to see some of the cheapest quotes for term life insurance in Canada.

Cheapest Life Insurance Quotes in Canada (2024)

Age Quote 1 Quote 2 Quote 3
20 $5.73/mo
(Manulife Vitality)
$10.13
(Empire Life)
$10.80
(BMO)
30 $6.09/mo
(Manulife Vitality)
$10.58
(Empire Life)
$11.25
(Desjardins)
40 $9.81/mo
(Manulife Vitality)
$13.50
(Empire Life)
$13.73
(UV)
50 $27.00/mo
(Empire Life)
$28.13
(Desjardins)
$28.13
(Foresters)

*Real-time quotes gathered on February 27, 2024. Rates based on a non-smoker in average health. 

Six ways to get cheap life insurance premiums

There are ways you can also make sure you get the lowest insurance rates possible — it’s not just up to the insurance company alone. Our experts have put together 6 insider tips on how you can get the cheapest insurance premiums:

  1. Talk to an expert
  2. Reconsider renewing
  3. Get alternatives to lender’s mortgage insurance
  4. Get term instead of permanent insurance
  5. Say yes to underwriting
  6. Get healthy (quit smoking, lose weight, etc.)

1 Talk to a professional

We’re all unique, which is why life insurance policies never come with a single shelf price. An experienced and licensed life insurance broker can use their experience, knowledge, and access to multiple insurance products in your favour. They can help you find the cheapest rates and give you personal tips on how to save on costs.

Even if you already have a policy, a good broker can help you check if there are cheaper options available. Especially if you’ve made health or lifestyle changes, like if you stopped smoking or lost some weight.

2 Consider buying a new policy instead of renewing

This seems counterintuitive but it can be a great strategy to save money. If you renew your insurance policy when the term ends, your premiums normally go up. There are a lot of different reasons for this, which we go over in a different article.

Sometimes, buying a new policy is the cheaper option. It’s easy to shop around online or speak with a broker to find other Canadian providers with more competitive rates on life insurance. You can then let your first plan expire and buy a new one with a brand, new, spanking cheaper price.

3 Say no to creditor or lender's mortgage insurance

You may have bought mortgage insurance from your lender when you first bought your home. But what many Canadians don’t know is that this type of policy is not mandatory. There are better and cheaper ways to protect your mortgage, and term life insurance is one of them.

You can match your term insurance to your mortgage amortization period. That way, if you suddenly die, your family will have the money to pay off the mortgage AND still afford their same standard of living.

You can say no to mortgage insurance from banks/lenders and get term life insurance instead.
Read more about the ways mortgage insurance is a better option

4 Choose term life coverage over a permanent life insurance policy

Term life policies are cheaper than a permanent life policy, and can often serve your needs just fine. People choose permanent coverage because of its benefits — like covering you for the rest of your life and an investment feature you can use now.

Both types of coverage can give your family financial stability in the future. But term life insurance can be the best and cheapest option if you only need it to cover short-term expenses.

5 Go for full underwriting

Some life insurance companies ask you to do a medical exam to get a policy. There are no-medical plans that let you bypass this, but they tend to cost a lot more because insurers can’t accurately determine the level of risk.

If you opt for full underwriting, you get better rates automatically. Plus, if you’re in really good health, your insurance company may offer you something called preferred rates. This is when they give you even lower rates than normal just because you’re in great shape.

Tip

Life Insurance Tip

Unless you have serious health concerns, you should choose full underwriting. Some of the best Canadian life insurance companies won’t even ask you to do a medical if you’re getting less than $3 million in coverage anyway. Check with a licensed advisor about your best course of action to save hundreds in life insurance premiums!

6 Improve your health

In general, the healthier you are, the cheaper your insurance rates will be. If you first get life insurance coverage when you’re unhealthy, you have a financial reason to improve your health.

You can ask your insurance company to reassess your policy if you make major health changes a year after you get your policy.

For example, if you’re a smoker who quit smoking, you can ask to switch to non-smoker rates. (And, yes, vaping and marijuana count as smoking too.) Or if you were overweight and lost some pounds to get into your BMI, you can check if you’re eligible for better rates too.

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Why does smoking matter?

Simply put, life insurance is all about avoiding financial risk. The insurance company uses your personal details to determine the chances that they’ll have to pay your death benefit and how soon. People who smoke are considered more risky because of the negative effect smoking can have on their health. And it’s not just smokers. Even certain jobs can be seen as more risky, like pilots, firefighters, and other dangerous jobs.

Does life insurance ever go on sale?

No, life insurance companies don’t have sales in the same way a $20 shirt at the mall might cost $15 the next time you see it. For most standard insurance policies, your premiums will stay the same for the entire duration of your term.

But, Canadian insurers do offer deals on insurance products from time to time. For example, they may drop prices for certain products if you’re buying a new policy. Or, as is the case with Desjardins, they may give you certain discounts if you buy more than one type of insurance with them.

If you’re looking for the latest life insurance deals, you don’t have to look far! We’ve listed them on our website so you can see them at a glance. Click below to take a look!

Current life insurance deals and promotions
Quotes Icon Author Photo
Jason Goveas
Senior Life Insurance Advisor
The average cost for term life insurance is around $22 to $25 for a young, healthy Canadian under 40 years. The cost depends on age, so prices increase the older you get. But even a 40-year-old can expect to pay around $28.

 

*Based on PolicyAdvisor.com quotes for $500k in coverage and a 10-year term

How to apply for the cheapest life insurance rates?

Easily find Canada’s cheapest life insurance quotes on PolicyAdvisor.com. Get instant online quotes so you can compare the cheapest prices in less than a minute. Then, apply online when you find the plan that fits your needs.

You can also contact us directly to speak with a licensed advisor and get tailored advice. We scan the market for you and find you cheap rates from trusted insurance providers in Canada.

How are life insurance costs determined?

The cost of life insurance depends on two major factors:

  1. Your personal details, like age and health
  2. Policy details, like what kind of plan you are buying and whether you get any add-ons

For your personal history, an insurance company will look at a wide range of details such as your:

Insurance cost is based on life expectancy. So, companies look at these factors to assess how long a person will likely live.

Young women in excellent health who don’t smoke get the lowest life insurance quotes. On the other hand, someone with serious health issues who smokes or enjoys high-risk activities like extreme sports will see higher prices.

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Did you know?

In Canada, women generally get the most affordable life insurance policies. Premiums are based on how long you’re expected to live. Statistics show that the life expectancy for women tends to be higher than for men in general. So, Canadian provider give them better rates on life insurance.

When you apply for a term plan, you get to decide your policy details, like:

  • Term length — how many years your term insurance will last
  • Death benefit amount — how much money would be paid out if a claim is made
  • Type of insurance policy
  • Life insurance riders

This also affects your price. In general, policies with a short term length and low coverage amount will give you the most affordable premiums.

You can also choose to add life insurance riders to your policy. These are like optional, mini-policies that you can add to your policy to give you more coverage. They usually don’t cost a lot, but will make your premiums go up a bit.

list of factors that affect the cost of life insurance

Why the cheapest policy may not be the best policy

While we want to help you get the best possible life insurance deals, we have to note — sometimes the cheapest policy is not the best option for you and your family.

And, the price difference between the cheapest policy and one that gives you fantastic value is often not that big. Compare the term insurance quotes below to the cheapest ones we showed you above, for example.

Sometimes, getting better coverage for just a few dollars more makes more sense, especially the younger you are.

Canadian Term Life Insurance Quotes — $500K, 20-year term

Age Female Male
20 $15.65 $23.34
30 $16.65 $23.75
40 $29.39 $38.25
50 $82.20 $123.75

*Real-time quotes gathered on February 27, 2024. Rates based on a non-smoker in average health.

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What to look out for when buying life insurance?

With life insurance, you want to make sure your family would have enough coverage for whatever their needs might be. That may be paying off the mortgage, settling any outstanding debts, or making sure their child’s college expenses are paid.

Remember, the point of life insurance is to give your family financial protection. A life insurance payout acts like a safety net they can rely on if something suddenly happens to you.

Cutting costs doesn’t always pay off. Saving a few dollars now may mean not giving your loved ones the best tomorrow. And, you can get great security for your family while still saving on costs.

🌟 Not sure how much life insurance your family would need? Our life insurance needs calculator can help you figure out. Check it out below!

Check out PolicyAdvisor's life insurance calculator.
There are several factors you should think about when considering how much life insurance you may need.

Frequently asked questions

The cheapest form of life insurance is a term policy. The shorter the term, the cheaper the policy. But the cost is also dependent on other factors as well, such as your personal health history, family history of medical conditions, your coverage amount, and more.

Term insurance is the most basic form of life insurance. The insurance company agrees to pay your family a death benefit if you die within a specified amount of time (a term).

It’s easy to understand, doesn’t cost a lot, and the application process is simple. You can see why term coverage is such a popular type of policy in Canada.

Canada’s biggest insurance companies will give life insurance coverage amounts as low as $50,000. Whole life insurance policies can go as low as $10,000 because most people use them for end-of-life expenses or estate planning instead of short-term needs.

But, you should compare online insurance quotes before buying just the minimum. In a lot of cases, policies that give you more coverage can cost less.

A 1-year life insurance policy is a term life insurance product where your term is for one year. If you die within that year, the insurance company will pay your beneficiaries a tax-free death benefit.

You may also see them called an annual renewable term policy. These kinds of policies usually seem great at first glance because their premiums are extremely cheap.

But, read the fine print before you buy. Every year you renew this policy, your premiums will increase. Over time, you’ll end up paying a lot more than if you just got a policy with a longer term.

Take it from our experts — it’s usually better for you, your family, and your wallet if you get a policy that lasts 5+ years instead. At least then, your rate is locked in for a longer time.

Permanent insurance and no-medical insurance are the most expensive types of insurance policy.

A permanent policy gives you lifelong coverage and has something called a cash value component. You can use this cash value to access growth and build wealth during your lifetime. These are the main reasons why it costs more.

No medical insurance is usually an option for people with severe medical issues. It guarantees you’ll be approved for a policy. But the insurance company also takes a bigger risk to do that, so the cost is higher.

types of life insurance like permanent life insurance
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The Best Life Insurance Companies in Canada (2024)

The best life insurance companies in Canada include Manulife, Canada Life, Desjardins, Empire Life, BMO, RBC, and more.

These companies each have different features that can benefit you best depending on what kind of protection you need.

That’s why we’ve rated the best providers in several different categories to bring you our list of the Top 30 Best Life Insurance Companies in this article.

Related: What are the biggest life insurance companies Canada?

List of Top 30 Best Life Insurance Companies In Canada – February 2024

After careful research, PolicyAdvisor.com has created a list of the 30 Best Life Insurance Companies in Canada based on their strengths and weaknesses.

Our experts have years of experience profiling and analyzing the best of what the industry has to offer. This gives us the unique opportunity to give real insight on different life insurance providers and how they can meet your needs.

The following list of top providers will enable you to expertly compare and choose your best term life insurance options.

Which are the best life insurance companies in Canada?

The best life insurance company for you depends on your needs, but these are the companies we can recommend as the best.

List of best life insurance companies in Canada
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Our Top-Rated Canadian Life Insurance Companies

Discover the best Canadian life insurance companies with our ratings and reviews below.

Best Life Insurance for Simplified Issue: Assumption Life

PolicyAdvisor Rating

Best for Simplified Issue

AM Best Rating A-

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Our Assumption Life rating:

We’ve given Assumption Life Insurance Company 5 stars and rated them as the best life insurance company for Simplified Issue because of their wide variety of flexible options.

Read our full Assumption Life Insurance review

Assumption Life overview:

Assumption Life has 4 different types of non-medical life insurance policies that don’t require you to do a medical exam. This is a great option for people who may have health issues.

Their life policies also give you flexibility. You can get bigger amounts of life insurance if you want to get full underwriting that looks at factors like your medical history and your finances.

Assumption Life pros and cons

Pros Cons
Multiple term coverage options Wide range of options can be confusing
Simplified, non-medical issue options available High policy fees and rider fees on non-medical policies
Quick, easy electronic process
Decreasing option available for mortgage coverage
Online access to account
Digital e-policy
Exchange and conversion options to convert to longer term products or permanent coverage

Best Life Insurance for Combo Coverage: Beneva

PolicyAdvisor Rating

Best for Combo Coverage

AM Best Rating A

GET QUOTES

Our Beneva rating:

We’ve given Beneva 4 stars and rated them as the best life insurance company for combo coverage because of their full suite of insurance products and life insurance riders.

Read our full Beneva Life Insurance reviewLearn more about what happened to SSQ Insurance CompanyLearn more about what happened to La Capitale General Insurance

Beneva overview:

Beneva Life Insurance is the powerhouse product of a merger between the Quebec-based life insurance companies SSQ Insurance and La Capitale.

If you want to get a lot of insurance from one place, you should consider Beneva. It has a Term Plus life insurance product that can be customized and has features like its Extreme Disability Benefit. This is a unique option in the Canadian insurance market.

Beneva also offers a variety of life insurance riders. These are like add-on plans you can get to give you more coverage. Their term life insurance can also be combined with other insurance products, like critical illness or disability insurance.

Beneva pros and cons

PROS CONS
Built-in Extreme Disability Benefit (rare in the market) Longer turnaround times for policy approval
Options to add critical illness and monthly disability indemnity for comprehensive financial protection
Several optional riders: accidental death and dismemberment and children’s term coverage
Preferred rates available starting at $250,000
Online access to account
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Affordability: BMO Insurance

PolicyAdvisor Rating

Best for Affordability

AM Best Rating A

GET QUOTES

Our BMO Insurance rating:

We’ve given BMO Insurance 5 stars and rated them as the best life insurance company for affordability because most of their policies have good prices and can be used for multiple purposes.

Read our full BMO Life Insurance review

BMO Insurance overview:

BMO’s term life insurance is a great option for individuals, couples, or business owners. Their prices are affordable and policies can be used for a lot of different things.

Term policies from BMO can cover mortgage payments and other debts, final expenses like funeral cost, and more. They can help someone provide for their family. Or, for a business owner, a term life policy can help protect a business and/or key employees.

BMO Insurance pros and cons

PROS CONS
Great value for cost No online account
Multiple term coverage options Only issues paper policies, no digital option
Can exchange 10-year term into longer term products Longer-term life insurance policy (25 and 30-year) not renewable
Compassionate benefit program death benefit advance in event of terminal illness
Options to convert into permanent coverage
Electronic contract delivery
Multi-policy discount available
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Financial Strength: Canada Life

PolicyAdvisor Rating

Best for Financial Strength

AM Best Rating A+

GET QUOTES

Our Canada Life Insurance rating:

We’ve given Canada Life Assurance Company 4 stars and rated them as the best life insurance company for financial strength because they’re the biggest insurer in Canada, with billions in annual premiums.

Read our full Canada Life Insurance review

Canada Life Insurance overview:

Canada Life is the country’s largest life insurance provider. It’s a member of the Power Financial Corporation group of companies, which also includes the Great-West Life Assurance Company.

With $396 billion in assets and a financial strength rating of A+ from A.M. Best, Canada Life is one of the most stable life insurers in the country.

Canada Life offers term life insurance with a wide variety of options, including life insurance riders that let you add a different type of life insurance to your plan.

Canada Life Insurance pros and cons

PROS CONS
Multiple term coverage options (5-50 years) Minimum $100,000 coverage or $500 annual premium required
Multiple rider options for single and joint policies Limited access to online account features
Options to convert into permanent coverage
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Non-Medical Policies: Canada Protection Plan

PolicyAdvisor Rating

Best for Non-Medical

AM Best Rating N/A

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Our Canada Protection Plan rating:

We’ve given Canada Protection Plan 5 stars and rated them as the best life insurance company for No-Medical policies because of their range of high-quality insurance policies that do not ask you to do a medical exam.

Read our full Canada Protection Plan Life Insurance review

Canada Protection Plan overview:

Canada Protection Plan is the best provider for life insurance policies without a medical exam, also called non-medical life insurance. The most common types of no medical insurance are simplified and guaranteed.

Canada Protection Plan is one of your best options for a simplified issue life insurance if you:

  • Are having difficulty finding insurance
  • Have been rejected for life insurance in the past
  • Simply want to apply and get approved for life insurance quickly (such as if you want to quickly settle the terms of a divorce settlement)

Keep in mind: if you are in good health and you don’t mind taking a medical test or having a waiting period, you can probably get an insurance policy that costs less than no-medical.

Canada Protection Plan pros and cons

PROS CONS
Multiple products offering simplified, no-medical coverage Premiums can be more expensive than competition
Most products available through a easy online application without any medical tests Max. coverage of $1 million
Multiple term coverage options Coverage ends at age 80 (most other Canadian providers end at 85)
Affordable premiums, including no-medical policies
Available to temporary residents such as those on a student or work visa
Most plans offer life protection
Customers can pay annual premiums by credit card
Options to convert into permanent coverage
Decreasing term option available (ideal for covering mortgage debt)
Digital e-policy

Best Life Insurance for Stability: Desjardins Insurance

PolicyAdvisor Rating

Best for Stability

AM Best Rating N/A

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Our Desjardins Insurance rating:

We’ve given Desjardins 4 stars and rated them as the best life insurance company for stability because they’re a well-established company with a strong financial rating.

Read our full Desjardins Life Insurance review

Desjardins overview: 

Desjardins is one of Canada’s biggest financial groups and is often ranked among the world’s 50 safest banks and financiers.

They have a few term life insurance options that can cover needs like helping your family keep their standard of living, helping to pay for your mortgage, or providing money for your children to go to college. Their term product also give you the usual benefits and features that are expected in the Canadian market.

Desjardins pros and cons

PROS CONS
Several optional riders and benefits Limited term options
Robust suite of critical illness, disability, and permanent life insurance available Premiums can be more expensive than competition
Allows multiple applicants on the same policy; 1 policy can cover the needs of an entire family
Options to convert to permanent coverage
Multi-policy discount available
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Personalization: Empire Life

PolicyAdvisor Rating

Best for Personalization

AM Best Rating A

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Our Empire Life rating:

We’ve given Empire Life 5 stars and rated them as the best life insurance company for personalization because they let you choose from a wide range of options to create your perfect policy.

Read our full Empire Life Insurance review

Empire Life overview:

Empire Life Insurance has a wide choice of products and term options to choose from. You can customize their insurance policies to create a term life plan that meets your exact needs. It’s flexible and affordable.

Empire Life Insurance has something they call the Solution series of term life insurance products. They have 10-year, 20-year, or 30-year terms and plus permanent insurance that covers you up to age 100.

They also have a product called an  annual renewable term (ART), where your life insurance lasts one year and you can renew it every year.

Empire Life pros and cons

PROS CONS
Some of the most versatile coverage options in Canada Limited term options
Options to exchange into longer term coverage Max. annual renewable term coverage of $499,999
Instant approval possible
Highly competitive premiums
Comprehensive rider options
Solution 100 term policy has cash value (rare in the market)
Online access to account
Digital e-policy

Best Life Insurance for Families: Equitable Life

PolicyAdvisor Rating

Best for Families

AM Best Rating N/A

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Our Equitable Life rating:

We’ve given Equitable Life 4 stars and rated them as the best life insurance company for families because they make it easy for you to combine more than one policy on just one document.

Read our full Equitable Life Insurance review

Equitable Life Insurance overview:

Equitable Life of Canada is one of the country’s biggest mutual companies — some of its owners are also the people who have insurance with them. They have many affordable options for both term and permanent insurance.

Also, you can get both single and multi-life coverage in the same policy. This lets family members have their plans on the same contract so they don’t have to pay a lot of separate policy fees.

Having just one insurance contract with many plans on it lets you do something called laddering”, where you only pay for coverage that you truly need.

Equitable Life pros and cons

PROS CONS
Options to add critical illness insurance and other term life riders Limited term options
Options to convert into permanent coverage, regardless of health Moderate premium costs
Preferred clients automatically qualify for EquiLiving critical illness insurance Limited term offerings
Can create family plan by adding child term rider
Online access to account
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Giving Back: Foresters Financial

PolicyAdvisor Rating

Best for Giving Back

AM Best Rating

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Our Foresters Financial rating:

We’ve given Foresters Financial 4 stars and rated them as the best life insurance company for giving back. Their term plans are straightforward but also have options to give you better coverage if your needs change.

Read our full Foresters Life Insurance review

Foresters Life Insurance overview:

Foresters Financial offers is a simple and straightforward term insurance product.

Many of their products also come with a unique perk: a charitable benefit feature where Foresters will donate to a charity of your choice on your behalf.

This is an excellent product if your financial needs change and you need insurance to match. Foresters also has optional riders to give you extra coverage.

Foresters pros and cons

PROS CONS
Multiple term coverage options Premiums can be more expensive than competition
Simplified and quick fulfillment options available No online access to policy details
Options to convert to permanent coverage, including participating and non-participating
Unique community membership benefits
Digital e-policy

Best Life Insurance for Quick Issue Options: Humania

PolicyAdvisor Rating

Best for Quick Issue

AM Best Rating N/A

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Our Humania Assurance rating:

We’ve given Humania Assurance 4 stars and rated them as the best life insurance company for quick issue option because their plans are designed for you to be able to get a policy approved fast.

Read our full Humania Life Insurance review

Humania Assurance overview:

Humania’s main term life insurance product is designed to make it easy for you to get approved. They don’t have as many requirements, and the policy is web-based and paper-free.

Most policies are insured on the spot (more than 65%) and in less than 45 minutes, with many completed in 15 minutes or less. You can this coverage for multiple terms, up to a maximum of 30 years or up until age 80.

Humania pros and cons

PROS CONS
Competitively priced premiums No preferred pricing available clients in better health
Multiple term coverage options Conversion only available until age 65
Options to exchange into longer term products No online access to policy details
Simplified and quick fulfillment options available Term coverage only available until age 80
Digital e-policy
Non-medical coverage options available
Automatic approval for critical illness and debt disability coverage for those with standard health

Best Life Insurance for Flexibility: Industrial Alliance

PolicyAdvisor Rating

Best for Flexibility

AM Best Rating A+

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Our iA Financial Group rating:

We’ve given iA Financial Group 5 stars and rated them as the best life insurance company for flexibility because their plans have options to customize even your term length, which is rare in the Canadian insurance market.

Read our full Industrial Alliance Life Insurance review

Industrial Alliance overview:

Industrial Alliance (iA) life insurance offers many customizable options with their term life policies. Their product called Pick-A-Term is the most unique. Like the name says, it lets you decide how long you want your coverage to last — anywhere between 10-40 years.

With this plan, you can match your term life insurance coverage with the specific number of years you have left to pay off debt (like your mortgage) or the number of years your children may need financial support.

Industrial Alliance pros and cons

PROS CONS
Flexible plans allow personalized coverage Premiums can be more expensive than competition
Pick-a-term feature (rare in the market)
Both level and decreasing options
Optional disability rider — can be used with decreasing coverage for mortgage protection
Non medical coverage options: simplified and guaranteed
Online access to account
Digital e-policy
Underwriting can be more accommodating than competitors
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Layering: ivari

PolicyAdvisor Rating

Best for Layering

AM Best Rating A+

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Our ivari rating:

We’ve given ivari 3 stars and rated them as the best life insurance for layering because their suite of products makes it easy to create unique coverage plans that overlap.

Read our full ivari Life Insurance review

Ivari Life Insurance overview:

ivari is an 80-year old insurance company that used to be a part of Transamerica Life. They offer a lot of different insurance products.

You can get term life policies from ivari on their own, or you can combine it with more terms or different types of insurance to create your own unique coverage plan. ivari’s term insurance is available in 10-, 20- or 30-year terms.

Ivari pros and cons

PROS CONS
Several optional riders, including children’s insurance Premiums can be more expensive than competition
Multiple term coverage options Limited flexibility for term length
30-year term has flexible options upon maturity
Online access to account
Digital e-policy

Best Life Insurance for Digital Innovation: Manulife

PolicyAdvisor Rating

Best for Digital Innovation

AM Best Rating A+

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Our Manulife rating:

We’ve given Manulife 5 stars and rated them as the best life insurance for digital innovation. They’re one of Canada’s biggest insurers and one of the first companies to take more of the process online.

Read our full Manulife Life Insurance review

Manufacturers Life Insurance Company (Manulife) overview:

Manulife is one of the biggest insurers not just in Canada but on the entire planet. Size doesn’t always mean good quality. But Manulife is a leader in digital innovation in life insurance and their product is one of the best.

They were one of the first Canadian companies to send clients their insurance policies electronically, although a lot more companies are doing it now.

Their underwriting process uses complex analyses to approve people for up to $2 million in insurance coverage without asking them to do a medical exam.

Manulife pros and cons

PROS CONS
Offers a fully electronic, digital fulfillment Limited term options
Digital e-policy Premiums can be more expensive than competition
Offers cash advance in event of terminal illness
Options to exchange into longer term products
Option to increase coverage up to 5th anniversary of certain term policies (rare in the market)
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Value For Money: RBC Insurance

PolicyAdvisor Rating

Best Value for Money

AM Best Rating A

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Our RBC Insurance rating:

We’ve given RBC Insurance 5 stars and rated them as the best life insurance if you want value for money because they have some of the most competitive premiums in the Canadian life insurance market.

Read our full RBC Life Insurance review

RBC overview:

RBC Insurance offers a best-in-class term life insurance product. And their prices are usually so good that they beat competition on cost alone.

Their policies let you choose different term lengths and coverage amounts, so you can customize your plan to match your needs.

RBC pros and cons

PROS CONS
Affordable premiums among the most competitive in the industry Only available to Canadian citizens and permanent residents
Max. coverage of $25 million
Flexible term lengths and coverage amounts
Pick-a-term feature (rare in the market)
Flexibility allows for insurance laddering
Multiple rider options
Renewable term life policies
Quick, easy application process: just 10 questions for coverage under $1 million
Online access to account
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for In-Person Purchase: Sun Life Financial

PolicyAdvisor Rating

Best for In-Person Purchase

AM Best Rating A+

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Our Sun Life Insurance review:

We’ve given Sun Life Insurance 3 stars and rated them as the best life insurance for buying in-person because they usually sell their products through financial advisors or firms.

Read our full Sun Life Insurance review

Sun Life Insurance overview:

Sun Life usually sells their insurance products in-person instead of online. You normally have to get it by meeting with a financial advisor or other insurance brokers who sell their plans.

Their term policies have standard features and optional benefits that can compete in the market. But their premiums may cost more than some other companies charge.

Sun Life pros and cons

PROS CONS
Multiple rider options Limited term options available (only 4)
Multiple options to convert to permanent coverage up to age 75 (most competitors stop at age 70 or 71) Limited flexibility for term length
Non-medical coverage options available Premiums can be significantly more expensive than competition
Max. coverage of $1 million for anyone legally living in Canada — not just citizens and permanent residents Stricter underwriting process for pre-existing health conditions
Online application process
Digital e-policy
Top 10 largest insurance company based on annual premiums

Best Life Insurance for Price: Wawanesa

PolicyAdvisor Rating

Best for Price

AM Best Rating A

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Our Wawanesa rating:

We’ve given Wawanesa 4 stars and rated them as the best life insurance for price because their premiums are often among the lowest in the industry.

Read our full Wawanesa Life Insurance review

Wawanesa Life Insurance overview:

Wawanesa Life is part of Wawanesa Insurance, a large Canadian company that sells a lot of different insurance products. They offer term life policies with terms ranging from 10 to 30 years, or a special term-to-age-80 option.

Also, if Wawanesa is right for your needs, you can potentially layer your coverage. You can get a base term plan then add up to 4 term life insurance riders with different term lengths. You can do this all in one policy.

Wawanesa Life pros and cons

PROS CONS
Multiple term coverage options Longer turnaround times for policy approval
Affordable premiums — among the most competitive in the industry Policies can only be converted into non-participating permanent products
Range of coverage options allows for insurance laddering
Renewable term life policies
No policy or rider fees
Coverage up to $500,000 approved without medical exam for those under age 45
Digital e-policy
Top 10 largest insurance company based on annual premiums

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Methodology: How did we rank life insurance companies?

Our life insurance company rankings were the result of in-depth research into key factors like:

  • Coverage amounts
  • Term lengths
  • Premium rates
  • Application process
  • Online access
  • Rider options
  • Key features
  • Financial strength rating
  • And more

Our team of licensed insurance advisors worked together to carefully assess the different policies available in Canada. Using this, we narrowed down a list of which life insurance company is best in which area.

Which insurance company should I choose?

The best provider for you is one that is able to meet your requirements and provide a solution that works just right for your family.

We can’t recommend a catch-all provider as the ultimate best life insurance company, because it depends on your unique needs. That’s why we researched and wrote these reviews of the best life insurance companies.

This will help you assess and decide for yourself which one you want to work with. But if you need help, give us a call! A licensed expert at PolicyAdvisor.com will be happy to help you sort it out.

What’s the best type of life insurance?

The best type of life insurance policy again depends on your own circumstances, needs, and goals. It will be different for everyone. For example:

  • Term life insurance Best for you if you’re fairly young and you have short-term needs. Many Canadians choose this option.
  • Whole life insurance — The best type of insurance for you if you want lifelong coverage, and you want to earn a little extra savings too. This type of policy comes with an investment component you can use during your life.
  • Universal life insurance — Might be best if you want lifetime coverage like a whole life policy, but you want to manage the investment component yourself.
  • No-medical life insurance — Best if you have health concerns or you don’t want to answer a lot of medical questions.

If you’re unsure, book some time with one of our licensed advisors to get expert advice on which type of policy would best fit your needs.

Compare types of life insurance
Learn more about the different types of life insurance in Canada

How to get the best term life insurance Canada?

You can find the best insurance policies for your needs on PolicyAdvisor.com. Check out our recommendations below then use our platform to compare the best life insurance quotes in under a minute.

Our platform lets you shop the best prices from more than 30 of the country’s best providers. Compare policies at a glance, so you can easily make the best choice for your family.

Or, if you prefer to speak to a professional, book a call with one of our licensed insurance agents. We’re happy to help and you have no obligation to buy!

Frequently asked questions

The top Canadian life insurance companies are Canada Life. Manulife, Sun Life, Industrial Alliance (iA), and Desjardins if you’re looking at size and financial strength alone.

In our ratings, we looked at more than just financial strength, though. Other policy details matter when you’re figuring out which is the best life insurance company for your family.

This chart shows the top five biggest life insurance companies in Canada based on annual premiums.

Term life insurance is the cheapest type of insurance policy in Canada. Premiums are lower because coverage is temporary and the policies don’t have extra options like a savings & investment component — the way whole life insurance does.

Life insurance premiums depend on your personal details as well as your policy details. In general, you’ll get the lowest life insurance rates if you are:

  • Young
  • Healthy
  • Non-smoker
  • Female
Learn more about how much life insurance costs

You should get enough life insurance to cover your family’s needs. The general rule of thumb is to get 10-12 times your annual income. But, you may need more.

The best way to find out how much life insurance you should buy is to use our life insurance calculator. It will ask you some questions then tell you the best amount for your needs.

You can find the best quotes for term life insurance on PolicyAdvisor.com. Our online platform lets you easily customize your plan and compare quotes from leading providers in under a minute.

Save time and money when you shop and compare online. Click the button below to get started now.

Contact us

If you’re still not sure which Canadian insurer is best for you, reach out to our team of experts! We’re happy to talk one-on-one to find out what your unique needs are help you figure out your best life insurance options.

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Can someone have multiple life insurance policies in Canada? (2024)

Life insurance policies are incredibly flexible and customizable. Not only do you have the choice between term life insurance and permanent life insurance, but you can also add life insurance riders to tailor a policy to exactly the coverage you need. That said, there are situations where you may need to think about changing your coverage or adding more policies to the coverage you already have.

It may seem strange to hold more than one life insurance policy simultaneously. Is it even allowed? We answer that and more below.

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Call 1-888-601-9980 to speak to our licensed advisors right away, or book some time with them below.

Can you have multiple life insurance policies?

Yes, in Canada it is perfectly legal and common to have multiple policies.

While there is no legal maximum number of policies (so you can have 2 life insurance policies or many more), insurance companies will look at the total amount of coverage you are seeking to determine whether it is reasonable and consistent with your needs.

In fact, you may already be covered by multiple policies and not even know it.

As most workplace insurance benefits include one life insurance policy, you would hold multiple policies if you took out any coverage on your own.

Beyond that specific situation, you can choose to have multiple life insurance policies of your own, from separate life insurance companies if you choose.

But why wouldn’t someone just get the coverage they need and hold only one life insurance policy?

Check out PolicyAdvisor's life insurance calculator.

Why would someone want to have more than one life insurance policy?

There are several scenarios where it makes sense to hold multiple life insurance policies at the same time.

For example, you may have already secured life insurance at a competitive monthly premium in your younger years that you think is sufficient. But, life happens. Perhaps a $250,000 policy you secured at that time is not adequate now with a new mortgage or children on the way.

Instead of discarding that coverage and starting from scratch with a new policy, you can keep your existing coverage and add more through a separate policy. This additional life insurance policy can have a different term and death benefit amount to better match your evolving needs.

Other reasons for taking more than one policy include laddering and risk avoidance. Laddering is a concept where you take out multiple term life insurance policies for varying terms (like 30, 25, 20 and 10 years) and with a decreasing amount of coverage as you grow older.

The idea stems from you having less financial risk and dependents as you age: children may become less reliant on your income, and you will have more and more of your mortgage debt paid down, as these may have been the reasons you acquired life insurance in the first place. Many Canadians also use permanent life insurance as part of their laddering strategy.

Risk avoidance is rooted in the unlikely event one of your chosen insurance providers fails or goes bankrupt. Some don’t like the idea of having all of their eggs in one basket, especially in the world of finances.

By spreading coverage among several insurance carriers, they ensure they still have coverage if one goes under. While there is nothing wrong with this approach, there are many “fail-safes” in the Canadian insurance industry that protect your coverage and make sure you are taken care of should something happen to your insurance provider.

Different kinds of insurance policies cover different kinds of needs. Term life insurance is great for providing financial protection to children or covering a mortgage debt, while whole life insurance (or permanent life insurance) is commonly used for long-term estate planning.

Lastly, multiple policies should not be confused with multi-life policies that are sometimes utilized for life insurance for couples.

Pros and cons of holding multiple life insurance policies

Pros Cons
Allows you to add coverage as needs and financial goals evolve More paperwork and multiple contracts to keep track of
Can protect different needs and goals with matching coverage Multiple premium payments taken out monthly
Diversify coverage across providers Policies added later in life will be more expensive
Cost effective; only pay for coverage when you need it.

Can you apply to multiple insurance carriers at once?

Yes, you can apply to multiple insurance carriers, but there are often better and faster ways to get multiple life insurance policies then applying to several providers at the same time.

In North America, insurance companies share limited information regarding insurability of an applicant through a regulated body called the Medical Information Bureau (MIB). They do this to enhance transparency and consistency of information between the companies.

In rare cases, the information the MIB provides prevents the more unscrupulous applicants from holding too many policies simultaneously or providing false information to get insured by one company after getting declined by another.

If you are sending out multiple life insurance applications at the same time, it will raise some red flags among the providers and the MIB.

This will slow down your approval while they asses whether you have a good reason to apply to multiple carriers and in rare cases it may result in you getting out-rightly denied for coverage.

What are the alternatives to buying multiple life insurance policies?

There are many alternatives to applying for more than one life insurance policy:

  • Using riders such as term riders or accidental death riders. They can be added to a base life insurance policy rather than buying the individual coverage.
  • Adding guaranteed insurability. You can increase coverage in the future to meet your evolving needs.
  • Converting your existing term life insurance policy – or a portion of it – into whole life insurance using the conversion feature.

In any case, enlist the help of an experienced digital broker like PolicyAdvisor whether you need one life insurance policy or think you will end up owning several.

We have the institutional knowledge and experience to help you navigate multiple applications and approvals, ensuring we don’t step on any toes as we present you with the potential costs and savings of multiple life insurance policies. Schedule a call today to get started.

Will all the policies pay out in full in the event of a death benefit?

Yes. You can claim on multiple policies and death benefits will be paid as per individual policy approvals and exclusions, if any. Life insurance policies do not coordinate or adjust benefits for other individual coverage that is in place.

Can you increase your life insurance coverage by buying several policies at once?

As mentioned above, yes – but within limits. Holding multiple policies is a common way for one to increase their life insurance coverage, but an insurance provider approves policies not only based on your health but also on the legitimacy of your coverage needs and your perceived ability to keep up with your monthly insurance premiums.

Overextending your finances to maintain several large life insurance policies does not make sense if the end result is you not having coverage at all.

Instead, calculate the right amount of coverage for your needs and contact a trusted broker to help tailor a life insurance coverage plan that works for your needs AND your budget.

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A guide to how life insurance works in Canada (2024)

About one-third of Canadians are currently without life insurance and 1 in 4 millennials in the country admit they are unlikely to purchase any kind of insurance in the near future.

The basics of life insurance are just not on our radars. So if you thought ‘Term to 100’ was the title of a Drake song, don’t be embarrassed, you’re not alone.

Life insurance 101 isn’t common knowledge in Canada, which is exactly why it’s a subject worth exploring, especially if you’ve increasingly found yourself in the company of real estate agents, in-laws, or babies.

But where to begin? Is a death benefit a charity concert? Does “participating insurance” come with a ribbon? Is “return-of-the-premium” a new Star Wars flick?

Let’s just start with the basics…

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Need insurance answers now?

Call 1-888-601-9980 to speak to our licensed advisors right away, or book some time with them below.

What is life insurance?

Life insurance is an agreement between you and a life insurance company. The agreement is if you die, they will pay a death benefit( a lump sum of tax-free money) to someone you choose. In exchange, you agree to periodically pay them an insurance premium: (a small amount of money over time).

You both decide on the amounts of cash coming in and out and the timeframes involved, but in a super, simplified form, that’s really it.

What can a life insurance claim payment be used for?

Your beneficiary (the person you select to receive the payment) is free to use the life insurance death benefit in any way they wish. The death benefit is tax-free. They can use the money to:

  • Cover everyday expenses so their family can maintain the same standard of living (groceries, bills, rent, etc.)
  • Pay off outstanding debt (mortgages, lines of credit, credit card bills, business loans, etc.)
  • Provide for their children’s education
  • Make a large donation to their preferred charity
  • Pay for their funeral arrangements
  • Protect their business

If you fail to name a beneficiary, the death benefit will be paid to your estate and the money may get taxed.

Learn more about life insurance claims.

What are the different types of life insurance in Canada?

There are two main types of life insurance: term life insurance and permanent life insurance (or whole life insurance).  Both whole life insurance and permanent life insurance have their pros and cons, but most Canadians (76 percent, according to the CLHIA) wind up with term insurance, either through individual plans or through their employer as a group plan.

Learn more about the different types of life insurance:

Term life insurance

Term life insurance makes the promise if you die, we’ll pay, but only if that were to happen within a specified period of time, or ‘term’. These terms are generally 10, 20, or 30 years, but you can choose smaller or larger term lengths or coverage that last until a specific age.

Learn more about how term life insurance works.

Whole life insurance

Whole life insurance covers you for your entire life and there is a cash value associated with your policy. Sometimes, whole life policies will also pay dividends based on the insurance company’s profits. This is known as participating insurance.

Learn more about how whole life insurance works.

Limited-pay whole life insurance

Limited-pay insurance is similar to whole life, except the payment plan is condensed. For example, the term could be 20 years: once you’ve paid your premiums over that 20-year period, your insurance is guaranteed for life and you’re off the hook for premiums. This type of coverage is typically the most expensive policy option. This is because premiums are front-loaded to offset the years where you will no longer be paying.

Learn more about how limited-pay whole life insurance works.

Universal life insurance

Universal life insurance is the same as whole life insurance, except you have more choice of where your cash value is invested. If you’re a savvy investor, this gives you the opportunity to generate a larger return than what is guaranteed from a traditional whole life policy. That said, it requires you to actively monitor the investment choices you’ve made with the cash value. Alternative investment solutions may help you achieve your financial goals faster.

Learn more about universal life insurance and how it works.

Term to 100 life insurance

Even though the word term is in the name, term to 100 is a whole life insurance policy that covers you until your death. The difference is with this policy there is no cash value or investment component, making the premiums a little cheaper. As a bonus, if you do live beyond age 100, you are no longer required to pay premiums and retain your coverage. Term to 100 life insurance policies are unique to Canada.

Learn more about how term to 100 life insurance works.

Annual renewable term life insurance (ART)

A less popular life insurance option, annual renewable term life insurance (ART) is designed for those looking for short-term life insurance coverage. ART is available on an annual basis with the possibility of renewal and can protect people who are between jobs, who want to improve their health before locking in a longer-term policy, or those with short-term debt.

Learn more about annual renewable term life insurance.

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Is life insurance worth it?

If you have dependents, life insurance premiums are worth the cost. Life insurance provides peace of mind knowing that your family will be taken care of financially when you pass away.

If you don’t have dependents, there could be other circumstances where the benefits of life insurance is worth the price of premiums. These can include:

  • Taking advantage of your youth and health to ensure a lower premium and future insurability
  • Providing a charitable gift to your favourite cause or organization
  • Leaving a financial gift or legacy to children or grandchildren, regardless if they are dependents or not

Learn more about if life insurance is worth it.

Does life insurance have cash value?

Permanent life insurance policies accumulate a cash value as the insurance companies invest your premiums. Policies such as whole life and universal life insurance have this investment feature. You can either cash it out, save it, loan against it, or apply the value to your existing policy.

Learn more about the cash value of life insurance.

Read more about:

How much is life insurance?

The cost of life insurance depends on several individual factors. For most young, healthy adults life insurance costs are quite reasonable on a 20-year term policy.

For instance, a 30-year old, non-smoking Ontario woman of average health, would only pay $21 per month for a $500,000 death benefit on a 20-year policy. If you’re personalizing your insurance policy so that it suits your specific needs and budget, life insurance can and should be affordable.

Coverage 10-Year Term 20-Year Term
$250,000 $11/month $14/month
$500,000 $15/month $21/month
$1,000,000 $23/month $36/month

Premiums for female, non-smoker, 30-years old

Personal factors affect your life insurance cost. Factors include:

  • Age: Insurance premiums rise in cost as you age.
  • Smoking Status: Smokers pay more for life insurance.
  • Gender: Generally, men have higher life insurance premiums than women.
  • Health: Insurance providers see health problems as adding to the risk of insuring you.
  • Family Medical History: Insurance providers also calculate the risk of known hereditary illnesses.

Details of your life insurance policy will also affect the price of your monthly premium. These aspects include:

  • Term Length: The longer your coverage period, the higher the premiums.
  • Coverage Amount: A larger death benefit will also dictate higher insurance premiums.
  • Type of Insurance: Term life insurance is less expensive than whole life insurance.

What are life insurance premiums?

Life insurance premiums are the amount of money you agree to pay the insurance company, usually monthly or annually, in order to receive coverage. The higher your age, the longer your term, or the larger your death benefit, the higher your premiums will be.

Learn more about life insurance premiums.

How much does term life insurance cost?

The main factors that affect the cost of term life insurance are the length of the coverage term and the size of the death benefit. This is in addition to personal factors like your health and family medical history.

Learn more about the cost of term life insurance.

How much does whole life insurance cost in 2024?

Whole life insurance generally costs much more than term life insurance because the death benefit lasts an entire lifetime. This means the payout from the life insurance is guaranteed as long as the policy owner is up to date on their premiums.

Learn more about the cost of whole life insurance.

More about the cost of life insurance

There are so many scenarios for Canadians of all ages seeking financial protection. Read more on how much life insurance costs at certain ages.

Different size death benefits also have starkly different premium payments. Learn more about the cost of life insurance policies with specific death benefit amounts.

Do I need life insurance?

Perhaps a better question is, do the people in your life need it?

Insurance is for clearing out debts (personal or business-related) and supplying an income replacement source to someone who relies on you because you’re no longer around.

Buying life insurance lets you secure assets for your family’s future by investing in an alternate income source. Without life insurance and the security of this death benefit, you’re putting all your family’s financial eggs in one basket: you, being alive and able to earn an income.

You may assume you have life insurance through your work’s group benefits, but such policies require a close look to ensure it covers everything you need.

Learn more about life insurance policies and workplace benefits.

How much life insurance do I need?

You should get as much life insurance as you can afford. Most wish to leave a multi-million dollar fortune to their family and loved ones when they die. But that’s not financially realistic for most.

Determine what “affordable premium” means to you. Build a budget to assess your family’s current financial needs, their future needs, your current liabilities and debts, and any costs associated with your death. That’ll reveal what kind of coverage amount you should aim for and the costs associated with it.

Some use the 10x your annual income rule, but we highly recommend using our life insurance coverage calculator to get a quick but comprehensive recommendation.

Read more about how much life insurance you need.

When should I buy life insurance?

Life events create the need for life insurance. Buying a home, having children, and getting married are good indicators that there are those in your life who depend on your income to maintain their quality of life. Premiums rise as you age, so purchasing insurance earlier in life can save you money.

Read more about when to buy life insurance.

What happens to a term life insurance when it expires?

When your insurance policy expires you have several options. Typically you

  • can convert a policy to whole life coverage
  • renew the policy at a higher premium
  • apply for a brand new life insurance policy
  • let the coverage expire if you no longer need it

Learn more about what to do if you outlive your term life insurance policy.

Can I renew a term insurance policy?

Most term life plans come with a renewability clause, that lets you extend your coverage upon expiry without having to redo your medical exam.

The downside of renewing your coverage is the cost: your premiums are reassessed (increased) to match your older age. Thus, some Canadians prefer to apply for a new insurance policy at the end of the term.

Learn more about renewing life insurance.

What personal information do I need to share with my insurance company?

Life insurance companies have a mandatory set of questions they ask during the underwriting process. They include:

Your insurance provider is hoping you don’t die while you’re covered so they want to make sure you’re healthy before insuring you. If you prove you’re in good health, they in turn offer you lower life insurance rates. They’ll ask about:

Based on your answers to these questions, you’ll be placed into a risk category and offered premiums accordingly.

Additional in-person medical exams will be required from time to time, especially when applying for larger coverage amounts.

Learn more about how to prepare for a life insurance medical exam.

What is an attending physicians statement?

The provider may also ask for a health report (called an attending physicians statement or APS) from your family doctor or any specialists you see about ongoing health conditions.

Learn more about attending physician statements.

Who should you name as your life insurance beneficiaries?

Your beneficiaries are those you name in your policy that receive the death benefit when you die. It’s important to list the right people so that your policy’s payout is used as you intended. If you do not name a beneficiary or there is ambiguity at the time of your death then probate can affect your life insurance benefit.

Learn more about how to choose a beneficiary.

Are there different types of beneficiaries?

Yes, there are revocable and irrevocable beneficiaries.

  • Revocable Beneficiary: a beneficiary that can be changed without their consent.
  • Irrevocable Beneficiary: a beneficiary that has to sign off on any changes to the policy, including coverage and beneficiary changes.

Learn more about revocable versus irrevocable beneficiaries.

Should you name your children as beneficiaries?

In Canada, minor children cannot legally receive the funds from a life insurance policy until they reach the age of majority. Thus, many people create a trust to manage the funds of life insurance death benefits meant for their children.

A trust is an estate planning tool that allows you to choose another party (the trustee) to manage financial assets for a beneficiary until a pre-determined time or when they reach the age where they can legally manage their own funds.

Learn more about managing life insurance benefits with a trust.

Should couples get life insurance?

Life insurance policies for couples have a number of benefits, including the potential to save money on policy fees and the simplicity of managing a single policy. There are a few life insurance policy options that couples can choose from, such as:

  • joint first-to-die life insurance
  • joint last-to-die insurance
  • combined or multi-life insurance

Learn more about life insurance for couples.

Should you choose individual or joint life insurance policies?

Like all policies, joint life insurance policies have pros and cons.

Pros

  • Save money on policy fees
  • One policy to manage

Cons

  • Less choice than individual coverage
  • Cost savings may be less depending on personal health factors

If you apply for individual coverage together, you can still save on policy fees.

Learn more about joint life insurance policies.

What happens to life insurance after a divorce?

If you’ve set your ex-partner to receive the death benefit from your insurance policy, a divorce won’t automatically change this.

When you separate from your partner, you may want to reassess your life insurance needs. The type of life insurance policy you have, who is named as your beneficiary, and the terms of your divorce will all be factors to consider after a divorce.

Learn more about how divorce affects life insurance.

Do business owners need life insurance?

Life insurance can help ease financial concerns and help sustain the business s after the passing of the owner or essential employee.  Whether it’s to cover a tax liability at death, to ensure adequate funding for a buy-sell agreement, or for use as collateral for a loan, a life insurance policy will often be purchased by a corporation to meet the business’s needs.

Learn more about life insurance for business owners.

Can I buy life insurance coverage through my business?

Life insurance receives unique and specialized tax treatment that makes it an effective tax and estate planning tool for business owners. They can use a corporate-owned policy to protect their families, preserve their personal and business assets, and ensure the continued viability and profitability of their business.

Learn more about the benefits of corporate-owned insurance.

More about life insurance for business owners:

Do seniors need life insurance?

Life insurance is a good consideration for those over 60 who do not have savings and may still have debts or dependents that rely on them. Term life insurance is not usually available for seniors 75 or over.  Permanent coverage (whole life, universal life, term to 100) is a great option and ensures coverage for one’s entire life, and can account for funeral expenses and medical debt.

Learn more about life insurance for seniors.

Is final expenses insurance worth it?

Final expenses insurance is essentially a permanent life insurance policy. This coverage includes a modest death benefit that is meant to cover end-of-life expenses that your loved ones may otherwise have to cover upon your death.

Funeral arrangements, burial costs, medical bills, and tax liabilities can add up quickly. Final expenses insurance is not usually necessary if you have a whole life insurance policy, but it does have the benefit of a fast benefit payout.

Learn more about final expenses insurance.

Should I add life insurance riders to my policy?

A life insurance rider is an optional feature added to your life insurance policy to better address your unique insurance needs. An insurance rider typically requires an additional payment which is added to your monthly premium, though some riders may also be included at no extra cost. There is a wide range of available riders. Common riders include additional term riders, critical illness riders, and guaranteed insurability.

Learn about life insurance for riders or read more about:

Should I get life insurance for my children?

As a parent or grandparent, there are benefits to purchasing a life insurance policy for your child or grandchild. Life insurance for children ensures future insurability for your child, regardless of health issues. The policy also offers an effective way to build wealth and can be an attractive alternative to Registered Education Savings Plans (RESPs).

Learn about how to use life insurance for riders or read more about:

Do you need insurance to travel to Canada?

Certain visas that allow for travel or stays in Canada do require insurance coverage. Super visa insurance is mandatory for those seeking approval for their super visa status. While other visitors to Canada need insurance, it is not mandatory for entrance into the country.

Which is the best life insurance policy?

The life insurance policy you should choose isn’t an answer in the back of the book. Life insurance is a deeply personal purchase and there are a lot of factors to consider. Not only should you factor in your family’s current financial needs, but you should also account for future costs like tuition fees, funeral arrangements, estate taxes, and any other debts or obligations you would want settled should you die. There a lot of options to choose from and a myriad of coverage combinations when you search for life insurance quotes. But, you should only purchase a policy you can afford and that you’re confident makes the most sense for you and your family.

Luckily, we’ve built a pretty great tool that can help you figure that out.

Head to our life insurance calculator, learn more about the best term life insurance or best whole life insurance in Canada, or check out the ratings below.

Term Life Insurance Company Rating
Assumption Life ★★★★★
Beneva ★★★★
BMO Insurance ★★★★★
Canada Life ★★★★
Canada Protection Plan ★★★★★
CIBC Insurance
Desjardins ★★★★
Empire Life ★★★★★
Equitable Life ★★★★
Foresters Financial ★★★★
Humania ★★★★
Industrial Alliance (iA) ★★★★★
ivari ★★★
Manulife ★★★★★
RBC Insurance ★★★★★
Sun Life ★★★
Wawanesa ★★★★

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What is whole life insurance and how does it work in Canada? (2024)

If you’re the kind of person who likes to cut your cake and eat it too, whole life insurance could be your perfect financial solution.

It gives you the peace of mind that comes with knowing your family will have some extra funds to handle any financial obligations once you’ve passed on. And it gives you a way to pocket some extra cash while you’re still around.

Think of this article as your easy guide to understanding what whole life insurance is, how it works, and how you can best use it to your advantage. Let’s take a look.

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What is whole life insurance?

Whole life insurance does just what the name says: it’s a type of insurance policy that covers you for your entire life.

It’s a special type of permanent insurance that gives your loved ones a payout when you die. They can use this payout for things like paying for your funeral or estate taxes, or anything else they need.

It also has an investment component that generates something called “cash value” that you can use in your lifetime. Some policies also pay dividends on top of cash value, giving you even more options to build wealth to use now.

People often use “whole life insurance” when they’re talking about permanent life insurance policies. But whole life is just the most common type of permanent insurance. There are other permanent life options as well, like Term-to-100 and Universal Life. You can learn more about that in our guide to permanent policies.

Check out our review of the Best Whole Life Insurance Companies in Canada

Key features of whole life insurance

Some of the key features that distinguish whole life policies from term life policies include:

  • Lifelong protection
    As long as you pay your insurance premiums, you will have coverage for life. This is unlike term insurance, which only lasts for a specific number of years.
  • Investment component
    Whole life policies build cash value by the insurance company investing the premiums you pay. This is automatic and included as part of all policies. Some policies also give you dividends. You can use cash value and dividends to pay premiums, reinvest, borrow, and more.
  • Guaranteed death benefit
    With this whole life, the insurance company has to make a payout, called the “death benefit.” Compare this to term life insurance, where someone could outlive their policy and the company wouldn’t have to pay anything.
  • Limited pay options
    Whole insurance lets you pay the entire cost of your premiums early if you want to. This premium payment option is called “limited pay.” Your policy lasts the rest of your life, but you could pay an agreed amount off in a certain time frame and still keep your policy until you die. For example, you could set a payment period of 8-20 years, or stop paying when you reach retirement age.
WHAT IS
WHOLE LIFE INSURANCE?
Whole life insurance is a type of insurance policy that lasts for your entire life.

Whole life policies provide your beneficiaries with a tax-free death benefit, plus they have a built-in investment component that generates cash value you can use in your lifetime. Some policies also pay dividends.

Most people get whole life insurance to cover long-term needs like paying final expenses or managing future estate taxes.

Question mark

What are the different types of whole life insurance policies?

There are two main types of whole life policies: participating and non-participating. The main difference between them is that a participating policy pays annual dividends but a non-participating policy does not.

Participating whole life insurance

A participating insurance policy has an investment portfolio that is managed by the insurance company. If that investment gets any returns, you will be paid the dividends.

Normally, dividends are paid out every year. They can be given to you as cash, or you can reinvest them into the policy. If you choose to reinvest your dividends, you will not be charged any tax on them.

There’s another benefit to reinvesting your dividends. It can increase your whole life policy’s death benefit value, which can then be left for your family or be used to leave a legacy once you pass away.

Participating life insurance is usually more expensive than non-participating because it pays dividends and gives you the option to increase your death benefit. Insurance companies look at how much they expect the investments to get back when they decide how much to charge you for this kind of whole life policy.

Non-participating whole life insurance

Non-participating life insurance is a whole life policy that gives you the basics. It still:

  • Covers you for your entire lifetime
  • Has a cash value component
  • Has level premiums that don’t change
  • Is guaranteed to pay out a death benefit

But it does not:

  • Have an investment account
  • Pay dividends
Learn more about the different types of life insurance in Canada

What is whole life insurance used for?

Whole life insurance can be used in many ways, depending on individual circumstances. You can use it to:

A lot of people use the living benefits provided through whole life insurance to support their retirement. The cash value growth and/or dividends can be used to supplement retirement income.

The funds from your death benefit can be used to pay for final expenses or end-of-life medical costs.

It helps your family not have to dip into their savings to pay for these kinds of things. They won’t have to mourn you and have the added financial burden of funeral costs.

Your loved ones can use the tax-free death benefit in any way they need or want. They can use it to replace the income you would have normally brought home, and pay bills or pay for children’s education. Or they can travel the world or invest.

Whole life insurance lets you keep providing for them even after you’ve passed on.

One of the features of whole life insurance that people love most is how it can help you with financial security during your lifetime.

Cash value grows over time and you can access it in a number of ways to help pay bills, reinvest, or make other smart “money moves.” All while you get the peace of mind that comes with life insurance.

This is why life insurance is sometimes called “cash value life insurance.”

How to access cash value

You can use dividend payments in a number of ways to help with saving money. A lot of older Canadians use it to:

  • Supplement retirement income
  • Pay off insurance premiums, so their insurance policy basically pays for itself
  • Help pay for current expenses, like children’s education
  • Get a cash payout for liquid assets
  • Buy paid-up additions, which means the death benefit they leave for beneficiaries actually grows over time
Learn how paid-up additions work

Many Canadians don’t realize this, but the property and assets you leave behind for your family can be taxed. A whole life policy can act as a buffer by paying those taxes and fees. It’s an effective estate planning tool.

This lets you make sure the inheritance you left behind isn’t diminished for future generations. And they don’t have to pay anything to get that inheritance you left for them.

Learn more about estate planning with life insurance

We’ve already seen that the money you leave behind can help your family. But it can also be a final financial gift to your favourite charity. Think of it as your way to give one last boost to a cause you really care about.

Whole life insurance can be purchased as a gift for your children or grandchildren. It can give them lifetime coverage that’s already paid up, and at a low cost to you.

Just think: the policy’s cash value could have grown so much by the time they turn 18 that they could go to college without getting into student debt. Or, by age 25, it could give them enough to afford a downpayment for a home.

It’s a great way to give children or grandchildren future financial safety.

Learn more about whole life insurance for children

Business owners may use whole life to support a business. It can help fund the purchase of a partner’s shares in the business at death or support loans as collateral.

Should I get whole life insurance?

You should get whole life insurance if you:

  • Want to be covered into old age without having to worry about it later in life
  • Want a built-in option to help supplement income in retirement or to cover other financial needs
  • Want to pay the same rate your entire life
  • Don’t have a strict budget
  • Want to make sure your surviving family doesn’t have to pay for your end-of-life expenses

Whole life insurance is ideal for people who have long-term needs. It’s usually more popular with older Canadians because of this. Young Canadians can get it too, to help lock in low life insurance rates permanently.

Because it lasts forever and has a cash value component, this type of policy can be pricey. It is usually more expensive than term life insurance policies. But these added benefits are often worth the cost if your budget has room for it.

A whole life insurance policy can be used during your lifetime and can help benefit your beneficiaries after you pass away.

Is whole life insurance worth it?

Yes, whole life insurance can be worth it if it meets your needs. You get the advantage of living benefits that you can use now, plus a guaranteed death benefit for your family. In that case, it’s like having your cake and eating it too from an insurance perspective.

Remember, whole life insurance is most valuable to you if you can let it grow over time. And if you don’t need it to cover immediate needs. If you’re young and thinking about long-term protection, then whole life is definitely worth the cost. By the time you reach retirement age, your cash value would have grown significantly.

If you need coverage for short-term needs like paying off a mortgage or something that would be taken care of by the time you reach a ripe old age, then term life insurance is probably a better option for you.

Compare term vs whole life insurance

What are the advantages of whole life insurance?

The main advantages of whole life policies are:

  • Lifelong coverage – Your policy will never expire once premiums are paid
  • Cash value growth – Premium payments are reinvested and grow cash value that you can access during your lifetime
  • Dividends (participating policies only) – Annual dividend payments can be used to reinvest, withdraw, buy more insurance, or more
  • No market volatility – The investment component is managed by the insurance company and it does not fluctuate with the market
  • Guaranteed death benefit – Life insurance will pay out when you pass away no matter what
  • Death benefit growth – Your death benefit or coverage amount can grow over time with cash value or dividends
  • Level premiums – The cost of your policy will remain consistent as long as your policy
  • Limited pay options – Your policy can be paid off in a short time frame so you don’t have to worry about it later

What are the disadvantages of whole life insurance?

The main disadvantages of whole life policies are:

  • Premiums can be expensive – Whole life policies can cost more than other types of life insurance, like term
  • Not as flexible as term life insurance – You cannot select coverage for just a set period; it can only last forever
  • Investment potential may not be as large as with other investments – Growth from a portfolio managed by the insurer will be moderate
what to do when term life insurance ends

How does whole life insurance work?

With whole life insurance, you pay a certain amount of money, called a premium, to an insurance company. This premium stays the same for however long you have the policy.

When you pass away, anyone you choose will receive the life insurance payout we mentioned earlier. This is a lump sum, tax-free payment that life companies will only give out once.

Let’s look at how some of the key factors of whole life insurance work.

You can make whole life premium payments on a monthly or an annual basis. Some companies give discounts if you pay yearly, so you could save up to 8%.

Unlike with term policies, you can pay off whole life premiums early with an option called “limited pay.” This is just like how it sounds: you pay for a limited time and you get to keep your policy forever.

Companies normally let you pay for 8, 10, 15, or 20 years. Or up until you turn 65. But this can be an expensive option for some. So, you can pay the normal way if you want, too.

We talk more about whole life insurance premiums and show you some figures in the section on cost in this article.

When you pay your premiums for your whole life insurance policy, part of that money is used to cover the cost to insure you. Another part is invested by the insurance company. The income they generate from investing your insurance payments is given back to you as cash value or dividends.

Think of cash value as a savings account that is managed by your insurer. You can access your whole life policy’s cash value throughout your lifetime.

How much the death benefit will be is usually the amount of coverage you choose when you first get your policy. But with whole life insurance, it can be more — or less — depending on your cash value and any dividends.

For all policies, you start with a base amount of coverage. For example, $100,000. But your beneficiaries aren’t always guaranteed to get that exact amount.

If you borrow against your cash value and don’t pay it back, you could have a lower death benefit. Life companies would deduct from your death benefit to pay back the loan. For example, your beneficiaries may only get $70K even though your original policy coverage amount was $100K.

On the other hand, you can put your policy dividends back towards your coverage. This could give you a higher death benefit value over time. For example, your beneficiaries could get $200K even though your original policy coverage amount was $200K.

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How much does whole life insurance cost in Canada?

The cost of whole life insurance depends on personal factors like your age, sex, and health.

Usually, if you’re young, in excellent health, and don’t smoke, your insurance premiums will cost less. Just keep in mind that it’s also normal for whole life insurance to be more expensive than term life.

The chart below can give you an idea of how much whole life insurance can cost at different ages.

Whole life insurance quotes in Canada (2024)

Age $100K coverage - non participating $100K coverage - participating
20 $42/month $44/month
30 $57/month $63/month
40 $85/month $92/month
50 $127/month $138/month
60 $202/month $217/month
70 $376/month $376/month

*Quotes based on $500k in coverage for a non-smoker in regular health on a life-pay plan. Quotes based on average prices from leading insurance companies in Canada.

The cost of insurance in Canada can change depending on your personal details and also your policy’s details. This chart is just to give you an idea of what kind of premium prices you can expect.

Because there are so many factors that affect policy premiums, the best way to know how much your whole life will cost is to get your own quote from PolicyAdvisor.com. Use our online quoting tool to get an instant quote in seconds.

What affects whole life insurance premiums?

Whole life insurance premiums depend on factors like:

  • Age
  • Sex
  • Current health
  • Medical history
  • Family medical history
  • Smoking status
  • Occupation
  • Lifestyle/hobbies
  • Policy type (participating or non-participating)
  • Amount of coverage
  • Regular or limited pay
  • Life insurance riders

Life insurance companies look at these factors to determine the financial risk to them to insure you. They call this your risk profile, and they charge you higher prices if it seems more risky.

For example, let’s say you are over 65, have health concerns, smoke, and participate in extreme sports. The insurance company will believe there’s a good chance you could pass away before they can raise enough funds (through investments) to cover your death benefit. In this case, they would charge you a high premium.

On the other hand, let’s say you are 30, in excellent health, and don’t smoke. Chances are you will live for a long time, giving the company time to invest your premiums so they don’t take a loss when they pay out your death benefit.

At the same time, the features of your whole life policy can also make it more expensive. If you choose to get a policy that pays dividends, one that you only have to pay for 20 years, one with $1 million in coverage, etc., your premiums will be higher.

How much whole life insurance should I buy?

The general rule of thumb is to get at least 10-15x your yearly income in life insurance. But experienced advisors will tell you that you may not actually need that much for whole life insurance. It depends on what you are getting whole life insurance for.

When deciding on how much coverage you should buy, you should think about things like:

  • How much money you would need for retirement support
  • How much money you or your family would need to keep up with the cost of living and inflation
  • How much money you or your family would need to cover estate taxes or other taxes
  • Any bills or outstanding debt that would have to be paid off
  • How much you expect your end-of-life expenses to be (funeral, cremation, special ceremony, etc.)
  • Your budget

You will want to get enough coverage to take care of these long-term needs. But remember that some policies can pay out more than the death benefit too.

A “secret” strategy that some Canadians use is to start out buying a modest amount of whole life coverage and let it grow to a higher amount over time. Through the investment component, the cash value or dividends can gradually make the death benefit much higher by the time it’s paid out decades later.

If you need help finding out how much life insurance you need, you should speak with one of our licensed insurance advisors who can give you personal advice. You can also use our free whole life insurance calculator online to find out at a glance.

When should I buy whole life insurance?

The best time to buy a whole life plan depends on you, your family, and all of your needs. There are different advantages to buying whole life at different stages of your life. So, it will depend on your unique circumstances.

When you’re young

Young people can buy a whole life policy with a limited pay option. While it’s more expensive, this will give you the option to pay it off while you’re still working. That way, by the time you retire, you won’t have to use your pension for insurance payments. You would have already paid everything and now you can just enjoy having coverage for life. And you would get the benefit of low premium rates, based on your age and health.

When you’re older

Premiums become more expensive when you’re older. But by then, you likely also would have a stable job and more personal finance know-how to be able to navigate a whole life policy with an investment aspect. You may more easily afford the higher premiums, and may be more comfortable navigating the investment benefits that come with that.

For children

As we saw earlier in this article, a whole life insurance policy for a child can go a long way in setting them up for a secure financial future. Adults are allowed to create a life insurance policy on behalf of a child, and then the child takes it over once they reach a certain age. If it’s paid up, this could be a fantastic financial gift for their future.

You should speak with one of our financial experts one-on-one to find out if and when whole life coverage might be right for you.

Author Photo
Whole life insurance is better for financial protection in the long run. It helps to make sure your family won’t have to struggle with money needs when you’re no longer around.
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Jiten Puri
CEO, PolicyAdvisor.com

Do I have to do a medical test to get a whole insurance policy?

It depends. These days, insurance companies may not ask for a medical test in many cases. They may just ask a few health questions.

In general, if you’re a Canadian citizen or resident in good health and you’re getting under $500K in coverage, you will probably not be asked to take a medical exam.

Learn more about life insurance medical exams

How can I find cheap whole life insurance quotes in Canada?

Find the cheapest whole life insurance quotes when you compare the best companies online at PolicyAdvisor.com! Our platform scans the Canadian life insurance market in minutes to bring you the best rates in seconds, making it quick and easy to find your life insurance match.

You can also speak with one of our advisors to find out how to get the best premium deals on life insurance. Or, check out our listing of which Canadian companies are currently offering promotions on insurance.

Speak with an advisor

Knowing which policy is best for you really depends on what your financial goals are. We know there are a lot to choose from, so our advisors are happy to help with your permanent life insurance needs!

Our team has in-depth knowledge of the Canadian insurance industry, so we can guide you based on the different benefits and drawbacks of each company. Let our licensed experts help you compare and make an informed choice. Book some time with us to see what your coverage options are and if whole life insurance coverage is right for you.

Frequently asked questions

What is cash value?

Cash value is the part of a whole life insurance policy that builds value over time. It can also earn dividends for some policies.

Policyholders can access cash value to withdraw it or use it for a policy loan if they need to. Access to this cash value is called a living benefit.

You should also know the difference between the policy’s cash value, and the cash surrender value.

Blue bulb

Cash Value is the sum of money that builds inside your insurance policy from investments.

 

Cash Surrender Value is the amount of money from your cash value that you can get if you cancel your whole life policy, minus any cancellation fees.

When can I cash out my whole life insurance policy?

It depends on your provider. Most Canadian companies will let you access your policy’s cash value anytime after the 4th or 5th year of your policy being active.

But you may want to wait. The longer you let the cash value accumulate, the more value it will have.

For example, after a few years, your policy may only have a couple of hundred dollars in cash value. That amount would be small compared to if you waited a few more years, when it may have increased to thousands.

Learn more about accessing cash value

Are whole life insurance policies taxable?

The death benefit of a life insurance policy is NOT taxable. However, things may get a little bit complicated if you want to cash in on your policy dividends.

If you reinvest your dividends into the policy, they won’t be taxed. But if you decide to cash out your policy or try to access the cash value in a way where you make a financial gain, you may be taxed.

Additionally, if you put the policy in your business’s name, your premiums may be tax-deductible. It’s always best to speak to a financial advisor about your specific plans for your whole life policy to know for sure.

Can I use a whole life policy to “be my own bank”?

No, you cannot use your insurance policy to become your own bank.

You may have seen this claim on social media platforms like TikTok, where some people claim you can use whole life insurance for “infinite banking.” But we would warn you that if something seems too good to be true, it usually is.

While the concept of “infinite banking” does exist, it’s very complicated. And it doesn’t work the way some catchy videos suggest.

What are the other types of life insurance in Canada?

Aside from whole life, you can get other types of permanent life insurance plans or something called term life insurance. In Canada, permanent and term are the two main types of life insurance.

A term life policy covers you for a specific period of time, called a term. Unlike whole life insurance, it does not have an investment component, cash value, or dividends. Because of this, it has more affordable coverage.

Other types of permanent coverage include:

If you’re not sure which is better for you, contact us. Our friendly licensed advisors are here to help and happy to help you figure out which life insurance plan would work best!

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How much does whole life insurance cost in Canada (2024)?

You can expect to pay anywhere from $45-100 per month for whole life insurance. But nailing down the exact cost of whole life life insurance can be tricky. First off, “whole life” is often used as a catch-all term for all types of permanent life insurance policies, when it’s actually just one type of permanent insurance. Secondly, whole life insurance has a lot of policy options that affect the price.

In this article, we’ll break down what whole life insurance is and all the factors that influence the monthly premium, so you can find out if whole life insurance is worth it.

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What is whole life insurance?

Whole life insurance protects you for your entire life, paying out a tax-free lump sum of cash to your estate or your beneficiaries when you pass away. The policy length is not a particular term, it lasts for as long as you live. As long as you pay your life insurance premiums, your policy never expires — it’s as simple as that.

Whole life policies come with a living benefit called a cash value component. As you pay your premiums over your lifetime, part of that money is invested and generates a tax-deferred cash value that grows over time.

Whole life insurance is just one type of permanent coverage. There are also other types of permanent life insurance like universal life insurance and term to age 100 insurance.

Read more about whole life insurance

Participating whole life insurance price vs. non-participating whole life insurance

Beyond the perk of cash value, some whole life insurance policies, called “participating policies,” offer additional investment perks. Whole-life policies that just have the cash value and no additional investment perks are known as “non-participating.” Whether your policy is participating or not has a large influence on the cost of life insurance.

  • Participating Whole Life Insurance
    In addition to accessing the cash value, the policyholder also receives dividends – typically annually. They “participate” in the insurance company’s investments because their premiums are used for the investments. Because of this additional growth generation component, participating policies are more expensive than non-participating policies. 
  • Non-Participating Whole Life Insurance
    The policyholder does not receive dividends and thus premiums are guaranteed, level, and generally lower.

How you pay your premiums will also have an effect on the cost of your whole life insurance. 

  • Life Pay Whole Life Insurance
    You pay the premiums for your entire life and receive coverage for life. 
  • Limited Pay Whole Life Insurance
    You only pay premiums for a set amount of time, not your entire life, but still get coverage for your whole life. It’s like an accelerated payment plan. Because of this limited pay period, the premiums are typically higher. 
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How much does whole life insurance cost?

For non-participating whole life insurance, you can expect to pay around $65/month for $100,000 in coverage, if you are in your 30s and in good health. The average cost for participating life insurance is about $75 for the same amount of coverage.

As we hinted above, whole life insurance tends to be more expensive than term life Insurance rates because the payout is guaranteed at the end of your life and there is a savings component to the policy.

Additionally, as with other types of insurance, whole life coverage costs more as you age. The later you buy, the less time your insurance companies has to collect enough premium to pay for the cost of insurance before they have to make a guaranteed payment. With that said, the chart below is a sample of average life insurance rates by age for whole life insurance.

Whole life insurance quotes in Canada

Age $100K coverage - non participating $100K coverage - participating
20 $47/month $54/month
30 $65/month $75/month
40 $92/month $110/month
50 $149/month $164/month
60 $245/month $263/month
70 $462/month $444/month

*Quotes based on $100k in coverage for a non-smoker in regular health on a life-pay plan. Quotes based on average prices from leading insurance companies in Canada.

Whole life insurance calculator Canada

Wondering how much insurance you might need? The above numbers give you some idea what Whole Life Insurance might cost, but check out our life insurance calculator to get a full, holistic view of what it takes to solidify your financial security. There you can start comparing quotes and insurance plans for whole life coverage.

Check out PolicyAdvisor's life insurance calculator
list of factors that affect the cost of life insurance

What affects the cost of whole life insurance?

The cost of insurance in Canada can change depending on your personal details and also your policy’s details. 

Personal Factors

  • Age and Birthday
    Life insurance costs increase with age due to higher statistical risks.
  • Gender
    Women generally have lower life insurance costs due to longer life expectancy.
  • Smoking Status
    Smoking significantly raises life insurance premiums. Products like cigarettes, e-cigarettes, and marijuana usage impact rates. Quitting smoking for 12 months may lead to cost savings.
  • Health History
    Healthy individuals with good BMI, no pre-existing health conditions, and favorable medical exam results receive lower premiums. Refusal of a medical exam or poor health leads to higher costs.
  • Family Medical History
    Hereditary conditions in family history impact life insurance rates.
  • Lifestyle
    Engaging in risky activities, criminal history, or having a poor driving record increases costs.
  • Occupation
    Dangerous occupations like firefighting or military service may lead to higher rates or coverage denial.
  • Foreign Travel
    Regular travel to high-risk nations may elevate life insurance costs.
  • Risk Classification
    Underwriters categorize individuals based on risk factors, affecting the premium.

Policy Factors

  • Length and Type of Policy
    Longer coverage duration leads to higher costs. Whole life insurance is more expensive than term life insurance products. 
  • Coverage Amount
    Higher death benefit requests result in more expensive policies. 
  • Policy Options and Riders
    Additional features like convertibility, critical illness riders, and more increase costs. Adding optional life insurance riders enhances the policy but comes at a higher price.

Because there are so many factors that affect policy premiums, the best way to know how much your whole life will cost is to get your own quote from PolicyAdvisor.com. Use our online quoting tool to get an instant quote in seconds.

Is whole life insurance worth it?

Whether or not you need whole life insurance depends entirely on both your personal choice and circumstances. It can provide a financial safety net while you’re alive by utilizing the cash value as well as provide security for your family after you pass away. 

Key benefits of whole life insurance include:

  • Lifelong coverage– Your policy will never expire once premiums are paid
  • Cash value growth– Premium payments are reinvested and grow cash value that you can access during your lifetime
  • Dividends (participating policies only) – Annual dividend payments can be used to reinvest, withdraw, buy more insurance, or more
  • No market volatility– The investment component is managed by the insurance company and it does not fluctuate with the market
  • Guaranteed death benefit– Life insurance will pay out when you pass away no matter what
  • Death benefit growth– Your death benefit or coverage amount can grow over time with cash value or dividends
  • Level premiums– The cost of your policy will remain consistent as long as your policy
  • Limited pay options– Your policy can be paid off in a short time frame so you don’t have to worry about it later

The main disadvantages of whole life policies are:

  • Premiums can be expensive– Whole life policies can cost more than other types of life insurance, like term
  • Not as flexible as term life insurance– You cannot select coverage for just a set period; it can only last forever
  • Investment potential may not be as large as with other investments– Growth from a portfolio managed by the life insurance company will be moderate

Whole life insurance can be a great product to meet specific needs, so it can be worth the price. The best way to determine if whole life insurance is best for your financial goals is to speak with an expert advisor.

A whole life insurance policy can be used during your lifetime and can help benefit your beneficiaries after you pass away.

Get a whole life insurance quote

If you need answers about whole life insurance right away, don’t hesitate to schedule a call with one of our licensed insurance advisors. They can answer any of your questions about whole life insurance, help you identify any gaps or shortfalls in your current coverage, and start you on the path to coverage if you so wish. In the meantime, calculate your life insurance coverage needs or get life insurance quotes online.

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How much does life insurance cost in Canada? (2024)

Life insurance can cost anywhere from $10-70 per month. There is no one-size-fits-all policy with a standard price. Life insurance is customized to your life and financial goals— the insurance companies take your personal and policy details into account and then determine the price. So, how do you know if you’re getting a good deal?

To get a general idea of how much you can expect to pay for life insurance, read on and find out average life insurance rates based on coverage and age, and learn more about how your policy is priced.

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Need insurance answers now?

Call 1-888-601-9980 to speak to our licensed advisors right away, or book some time with them below.

How much is life insurance in Canada?

The average cost of term life insurance in Canada is about $10 per month for $100,000 in coverage for a 10-year-term policy, if you are young and healthy (30-40’s, non-smoker). However, the actual price of life insurance is dependent on the type of policy you get and your personal demographics.

How much does life insurance cost?

Life insurance rates by age in Canada

Age plays a big factor in the cost of life insurance. Check out the quoted prices for each age group in the tables below.

Age $250K $500K $1MM
30 $18/month $30/month $52/month
31 $18/month $30/month $52/month
32 $18/month $31/month $52/month
33 $19/month $31/month $53/month
34 $19/month $31/month $54/month
35 $19/month $31/month $54/month
36 $21/month $33/month $59/month
37 $22/month $36/month $65/month
38 $24/month $39/month $71/month
39 $26/month $42/month $78/month

This quote is for a 20-year term for an individual in good health and a non-smoker, organized by gender.

Age $250K $500K $1MM
40 $27 $45 $84
41 $30 $49 $93
42 $33 $54 $102
43 $36 $59 $113
44 $39 $65 $125
45 $43 $72 $138
46 $47 $80 $153
47 $52 $89 $171
48 $57 $99 $191
49 $63 $111 $213

This quote is for a 20-year term for an individual in good health and a non-smoker, organized by gender.

Age $250K $500K $1MM
50 $70 $124 $236
51 $79 $133 $257
52 $88 $152 $294
53 $99 $172 $331
54 $112 $192 $368
55 $125 $214 $407
56 $141 $257 $495
57 $158 $283 $560
58 $177 $325 $639
59 $199 $359 $703

This quote is for a 20-year term for an individual in good health and a non-smoker, organized by gender.

Age $100K $250K $500k
60 $224 $403 $787
61 $248 $447 $876
62 $275 $496 $970
63 $304 $550 $1,075
64 $337 $611 $1,191
65 $374 $675 $1,283
66 N/A N/A N/A
67 N/A N/A N/A
68 N/A N/A N/A
69 N/A N/A N/A

This quote is for a 20-year term for an individual in good health and a non-smoker, organized by gender. Please note that coverage for a 20-year term is only available up to age 65. 

Age is one of the biggest factors for life insurance as it’s closely related to your health and life expectancy. Find out more about life insurance for seniors.

Life insurance rates by coverage amount

The table below has common life insurance death benefit amounts and how much they cost depending on your age.

Age Non-Smoker Smoker
30 $37 $77
35 $37 $84
40 $49 $124
45 $75 $211
50 $114 $348
55 $188 $614
60 $375 $980
65 $666 $1,732
Age Non-Smoker Smoker
30 $22 $43
35 $23 $48
40 $28 $68
45 $42 $114
50 $63 $203
55 $98 $339
60 $201 $557
65 $360 $911
Age Non-Smoker Smoker
20 $9.65 $9.73
25 $9.71 $9.73
30 $10.08 $10.15
35 $10.47 $10.87
40 $11.47 $13.86
45 $13.00 $20.47
50 $17.51 $31.27
55 $24.70 $49.77
60 $36.94 $77.89
65 $56.43 $117.54

To quickly see how much term insurance would cost for you, use our life insurance calculator. You can get a personalized, no-obligation estimate matching your financial security needs in minutes.

Check out PolicyAdvisor's life insurance calculator.

What is the cheapest life insurance? 

The cheapest form of coverage is term life insurance. This type of life insurance policy provides coverage for a set amount of time or term.

Because you’re only covered for a short amount of time (10, 20, or 30 years, etc), a life insurance company will charge you less than a policy that lasts your whole life (more on that below).

How much does term life insurance cost?

As mentioned above, term life insurance generally costs about $10 a month for $100,000 in coverage if you are young and healthy. But you may need more or less coverage, and maybe your health circumstances are different.

Check out the table below for general term life insurance rates, based on age and term length.

Term life insurance quotes in Canada*

Age 10-year term 20-year term 30-year term
20 $22/month $29/month $34/month
30 $22/month $30/month $45/month
40 $28/month $45/month $88/month
50 $62/month $117/month $239/month
60 $180/month $380/month Not available

*Quotes based on $500k in coverage for a non-smoker in regular health. 

How much does whole life insurance cost?

Permanent insurance or whole life insurance policy prices are generally a more expensive type of policy because it provides coverage for your entire life. Additionally, whole life insurance policies have a cash value which your elevated premiums also contribute to, and can be accessed in the form of policy loans or a policy dividend.

Learn more about how permanent insurance policies work and the cost of whole life insurance.

To get a general idea of how much whole life insurance costs, check out these whole life quotes below.

Whole life insurance quotes in Canada*

Age $100K coverage - non participating $100K coverage - participating
20 $47/month $54/month
30 $65/month $75/month
40 $92/month $110/month
50 $149/month $164/month
60 $245/month $263/month
70 $462/month $444/month

*Quotes based on $100k in coverage for a non-smoker in regular health. 

How much does life insurance for kids cost?

The price for children’s life insurance is cheaper than if you bought it as an adult—in some cases children’s life insurance costs a little as $3 per month. But it depends on how you buy this coverage for your child.

You can purchase life insurance for a newborn child – or even older children – in two ways.

1. Add a child rider to your insurance policy

This typically adds a few more dollars to your monthly insurance premium and provides a modest death benefit should a dependent child pass away while your policy is still active.

2. Buy a separate whole life policy

Children’s whole insurance is guaranteed to remain in force for the covered child’s entire lifetime (including into adulthood) and can generate dividends during this whole period. Whole life insurance also accrues a cash value, which the child can later withdraw from – like a savings account – or use as collateral for a loan from a financial institution.

Learn more about life insurance for children.

What affects the cost of life insurance?

The cost of life insurance is determined by two types of factors:

  1. Your personal health and lifestyle
  2. The details of your insurance policy
list of factors that affect the cost of life insurance

1. Personal factors that affect your life insurance cost

When you fill out a life insurance application, you will have to disclose some personal details so the life insurance company can assess the risk to insure you. Some personal factors that affect the cost of your life insurance are:

Age and birthday

The younger you are, the cheaper your life insurance will be. The cost of life insurance premiums rises as you age – statistically, you’re more likely to die or get sick the older you are. If you’re older, you may want to read more about the best life insurance for seniors.

The monthly cost of life insurance is determined by your age at your nearest birthday. If you are turning 40 within the next five months, an insurance provider will consider you 40 right now, not 39.

Actual age: the age you are right now.

Issue age: the age that the insurance company issues your policy, which is your closest birthday.

Gender

Gender affects the cost of life insurance. Women are less likely to die at an earlier age. The average life expectancy in Canada is 4 years higher for females.

Smoking status

It’s no secret that smoking is terrible for your health and increases your likelihood of developing a long list of diseases.  Because of this smoking will impact the cost of your life insurance premiums significantly, usually doubling the cost of life insurance as you age.

You are considered a smoker if you use any of these products:

  • Cigarettes
  • E-cigarettes
  • Cigarillos or Cigars less than once a month*
  • Vapes
  • Nicotine gum or patches
  • Chewing tobacco
  • Marijuana more than 3 times a week*

*every company will have its own rules for who they consider a smoker.

If you prove that you quit smoking for 12 months, you may no longer be considered a smoker. Though, you will probably need to submit another blood sample to prove this fact. That said, the cost savings can be another motivating factor to kick the habit!

Learn more about life insurance and smoking.

Health history

Insurance providers like healthy people – the healthier you are, the less likely they’ll have to pay out the death benefit. Insurance companies base your health status on key parameters like:

  • Height and weight (bmi)
  • Pre-existing conditions
  • Previous diagnosese (cancer,  stroke, high blood pressure, mental health, etc.)
  • medications
  • history of alcohol or drug use

If a medical exam determines your BMI, cholesterol, blood pressure, history of disease, alcohol and drug use are in a good place, your cost of life insurance and monthly premiums will most likely be much lower. If you refuse a medical exam, or your exam reveals your health isn’t the best, you can still get coverarage…but at a much higher cost.

Simplified issue life insurance skips in-person life insurance medical exam and instead only asks some simple questions about your medical history and health.

Guaranteed issue life insurance also skip the medical exam and health questions altogther.

Though it is easier to qualify for this coverage because of the quick underwriting process, of these policies they is typically much more expensive than a fully underwritten insurance policy.

Learn more about no medical life insurance.

Family medical history

Family medical history impacts your life insurance cost as well. Many medical conditions are hereditary. It’s common for family members to end up developing the same conditions, be it cancer, heart disease, or rarer illnesses. Despite your current health, any critical illnesses or related deaths in your family history will affect your life insurance rate.

Lifestyle 

Regardless of your health status, if you live an extreme lifestyle, you may be charged more. If you have a poor driving record (tickets, accidents, drunk driving charges) or you regularly engage in dangerous activities like sky-diving, race car driving, or mountain climbing, the life insurance company will consider you risky—this is because these activities are statistically linked to shorter life expectancy. Depending on the risk factor the insurer…

  • will raise your life insurance rate
  • suggest some coverage exclusions
  • in extreme cases deny your coverage altogether

Occupation

Just like extreme sports enthusiasts make insurers nervous, so do those who work dangerous jobs.  This could include:

  • Firefighters
  • Police officers
  • Military
  • Pilots
  • Alaskan crab fishermen
  • MMA fighters

If you have any of these occupations you may face a higher life insurance rate (or may not even qualify for life insurance) because of the risk that comes with the job.

Foreign travel

Do you have a well-stamped passport? What you gain in worldliness may end up costing you on your insurance premiums. If you regularly travel for extended periods to high-risk nations, you may also elevate your life insurance cost (or altogether denied coverage).

Learn more about travel and life insurance.

Current and past risk classification

Based on all the information above, insurance underwriters place you in risk categories and charge them accordingly. The more risky you are according to the insurance company, the higher the rating and higher the price. Each company names its categories differently (e.g. Regular, Premium, and Premium Plus – kind of like gas).

Learn more about risk categories and life insurance ratings.

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2. Policy factors that affect your life insurance cost

Length and type of life insurance policy

One of the biggest factors in the cost of life insurance is the length of coverage. The longer you’re covered, the higher the price. So, if you have a short-term policy, it will be a lot cheaper than a whole life policy.

It’s important to consider your life insurance needs when picking a policy, not just the cost. Just because it’s cheaper doesn’t mean it will fit all your needs. For example, a one-year renewable-term policy might not be appropriate for your long-term investment goals, but maybe a permanent life insurance policy would.

Learn more about different types of life insurance.

The amount of the death benefit

The more coverage you ask for, the more expenseive the policy will be. This is why it’s important to know what your life insurance needs are so you don’t over-insure yourself.

If premium costs are a real concern, make sure you’re accurately filling out a online life insurance calculator and keeping your family’s future financial requirements realistic. If you can lower your death benefit, while still confidently protecting your family, some savings on the cost of life insurance can be found.

Learn more about how much life insurance you need.

Policy options and riders

Anytime you add on the bells and whistles, it’s going to cost more. Things like convertibility, guaranteed renewability, critical illness, disability and long-term care insurance riders, waiver of or return of premium clauses, child term riders, and more, can drive up life insurance costs.

Learn more about life insurance riders

Is life insurance paid monthly?

Yes. Most people opt to pay their life insurance premiums on a monthly basis. However, like any payment plan, you will save money if you choose to pay annually.

For some permanent plans, you can also choose to condense your payments so that you only pay for your life insurance during your highest-earning years. This is called a limited-pay life insurance plan. This means you might pay your premiums for 10, 20, or 30 years, but get to keep the policy for the rest of your life. Premium installments would, of course, be higher. But it means you won’t have to worry about monthly payments in retirement.

How can I lower the cost of life insurance?

There are some ways you can lower your insurance premium.

1. Change your payment method

While insurance premiums are generally paid monthly, you can get a discount by opting for an annual premium.

2. Don’t skip the medical exam

And as mentioned above, fully medically underwritten policies, including an in-person medical exam, typically have lower insurance premiums than simplified or guaranteed life insurance policies.

3. Shop around

You’re allowed to shop and find a better policy. Perhaps the one you have doesn’t meet your needs anymore, now that your life has changed. Perhaps your bank didn’t offer the most affordable price to you. Luckily, we have a solution! Our life insurance quoting tool allows you compare prices and get life insurance quotes from over 30+ Canadian providers.

Get help figuring out life insurance costs

You don’t have to do all the research to find out the cost of term life insurance coverage alone. Our life insurance quoting tools can help you find out the exact life insurance costs from some of Canada’s top life insurance companies.

Need help?
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