As one of the almost 2.5 million Canadians with diabetes (source: Statistics Canada), you may have hit some stumbling blocks or even brick walls on your search for insurance of any kind. Getting life insurance when you are diabetic can be a little less straightforward than for those without it. But, it is possible to obtain life insurance for diabetics, and it may be less expensive than you assumed.

Why does diabetes affect insurance rates?

Diabetes is a disease that affects how your body uses and produces insulin, a hormone produced by your pancreas. There are three types of diabetes: Type-1 diabetes, Type-2 diabetes, gestational diabetes.

Type-1 diabetes

It is also known as insulin-dependent diabetes, is an auto-immune disorder. For Type-1 diabetics, their pancreas no longer produce insulin, a hormone that helps your body convert sugar to the energy you need. You need to administer synthetic insulin to cover for the food you eat

Type-2 diabetes

People with type 2 diabetes produce insulin, but their bodies do not use or recognize it correctly. They can deal with the condition through oral medication or diet. Type-2 diabetes is the most common form of diabetes in Canada, with approximately 90% of diabetics living with Type-2 diabetes.

Gestational diabetes

It is a temporary form of diabetes associated with pregnancy. The body cannot produce an adequate amount of insulin, leading to an increase in the amount of blood sugar. In most cases, gestational diabetes goes away post-pregnancy

So why would diabetes affect life insurance policy premiums? Well, the stress of constantly fluctuating blood sugar levels puts stress on your internal organs, like your heart and kidneys. The added stress means your organs are prone to failure in their older years. Thus, approving your application takes on added risk factors and adds to the cost of life insurance.

More specifically, Type-1 insulin-dependent diabetes is usually diagnosed in childhood and puts a lifetime of stress on one’s body. This is why insurance rates for Type-1 diabetics are higher.

Type 2 diabetes is more prevalent in individuals after the age of 40, and its effects can be quickly remedied by diet; organ stress is not as great of a factor in medical underwriting.

Gestational diabetes does not usually affect insurance rates, as most expecting mothers opt to do any medical underwriting before or after their pregnancy.

Can diabetics get life insurance?

Yes, diabetics in Canada can get life insurance in Canada. Diabetics who are in good health, with consistent medication levels, and who keep their blood sugar levels in control can qualify for standard, medically underwritten life insurance coverage.

In medically underwritten life insurance, the life insurance company will arrange for a blood test and likely request for a physician’s report to evaluate and screen for a pre-existing condition and grant approval for a life insurance policy. This process may provide more a higher death benefit for a lower premium, than no medical life insurance.

Much like anyone with a pre-existing health condition, no medical life insurance is another choice for diabetics. No medical life insurance is a policy that is issued without the insured having to undergo a medical exam. It usually has the added advantage of a simpler and faster issuance process that doesn’t require details for every medical condition one may have.

The two most common types of no medical life insurance are simplified issue and guaranteed issue. Read more about simplified vs guaranteed. 

What are the types of life insurance available to diabetics?

In Canada, diabetics have several life insurance options, though the specifics can vary based on individual health conditions and insurance providers. Here are the primary types of life insurance policies accessible to diabetics:

Term life insurance

Term life provides coverage for a specific period (e.g., 10, 20, 30 years) and is generally more affordable than permanent life insurance.

Term life insurance may have higher premiums for diabetics depending on how well the condition is managed and overall health factors

Permanent life insurance

A permanent life insurance policy includes whole life and universal life insurance. It offers lifetime coverage with an added savings or investment component and has higher premiums than term life insurance. This may also require more stringent medical exams for diabetics

Simplified issue life insurance

Simplified issue life insurance requires no medical exam but only a health questionnaire, designed for individuals with health issues who might have difficulty qualifying for traditional life insurance. This policy typically has higher premiums and lower coverage amounts and is often easier for diabetics with well-managed conditions to obtain

Guaranteed issue life insurance

A guaranteed issue policy involves no medical exams or health questions and guarantees acceptance up to a certain age (e.g., 75 years). It has higher premiums and lower coverage amounts and often includes a waiting period (e.g., 2 years) before the full death benefit is paid out.

This is suitable for diabetics with significant health issues or those who have been declined other types of insurance

Comparing life insurance options for Type 1 and Type 2 diabetes patients

Securing life insurance as a diabetic can be challenging, but options exist for both Type 1 and Type 2 diabetes. The eligibility, cost, and coverage depend on factors like age, disease duration, treatment stability, and overall health. 

While traditional life insurance requires medical exams and detailed health records, no-medical life insurance offers a quicker, hassle-free alternative, but at a higher premium. Understanding the differences in insurance options for Type 1 and Type 2 diabetes can help individuals find the best coverage for their needs.

Best life insurance for type 1 diabetics

The availability of a life insurance policy for people with type 1 diabetes depends on the age of the applicant, duration of the disease, and degree of control. Traditional life insurance companies that require lab results will also seek a doctor’s statement to establish the stability of the treatment and the condition.

In most cases, a life insurance company may apply a rating (higher premium) when approving life insurance for those with type 1 diabetes. No-medical, questionnaire-based options make for an easier and faster process in such cases, albeit they offer life insurance for diabetics at higher premiums.

For no-medical questionnaires, the focus is primarily on the age of the insured, the stability of the medication, and the risk of complications. If you are older, with no change in your insulin dependence in the last 12 months and no associated complications, you can easily get life insurance with no medical exam or obligation to provide medical records.

Best life insurance for type 2 diabetics

People with type 2 diabetes can get life insurance in Canada with the possibility of standard, competitive pricing. Life insurance companies are usually more accommodating when offering life insurance to people with diabetes who do not require insulin injections.

Traditional insurance companies may even consider granting standard regular-health pricing (even more affordable life insurance) to someone who is:

• Above the age of 50
• Controlling their blood glucose levels and providing lab results with A1C levels
• Undergoes regular medical check-ups with a physician or specialist
• Is treated with oral medications that have not been increased in the past 12 months
• Follows a diet
• And has no diabetes diagnosis associated complications

There are also several options with no medical exam for people with diabetes who may not be able to get standard pricing or those that may want easier and faster access to life insurance.

Most no-medical life insurance questionnaires contain a few questions that seek to assess how long you have had type 2 diabetes, whether your medications have changed recently, and whether you have any complications associated with this type of diabetes. Based on simple binary questionnaires, the eligibility of life insurance for diabetics can be established fairly quickly.

Best life insurance companies for diabetics in Canada

There are several companies in Canada that cater to individuals looking for life insurance in Canada. Here are some of the best ones to look out for:

• Canada Life
• Sun Life Assurance Company of Canada
• Manulife
• Desjardins Financial Services
• Industrial Alliance Life Insurance
• Beneva Inc.
• Royal Bank of Canada (RBC)

What factors affect insurance rates for diabetes?

Several factors affect insurance rates for diabetics, as insurers evaluate risk based on how well the condition is managed and its impact on overall health. Here’s a collated list of factors that influence insurance rates:

Age

• Your age when you apply for a policy: Younger applicants generally secure better rates due to lower perceived risk
• Your age when you were diagnosed with diabetes: Earlier diagnosis can lead to higher rates due to longer potential exposure to complications

Type of diabetes

• Type 2 diabetes: More common and generally considered less risky compared to Type 1 diabetes but still affects rates
• Type 1 diabetes: Often associated with higher risk due to its complexity and potential for complications
• Gestational diabetes: Typically resolves after pregnancy; however, if it leads to Type 2 diabetes later, it can affect rates

Severity of your diabetes or blood sugar control

• Well-controlled diabetes with stable blood sugar levels is viewed more favorably by insurers
• Poor control with fluctuating blood sugar levels or complications can increase risk and lead to higher premiums

Other medical conditions

• Additional health issues can increase risk and affect premiums
• A family history of diabetes or related health conditions can influence rates
• Excessive alcohol consumption can impact overall health and increase insurance premiums

Tips to lower life insurance rates for diabetics

Lowering life insurance rates for diabetics will require you to take proactive steps to manage your condition effectively and demonstrate overall good health to insurers. Here are some tips to help reduce premiums:

• Maintain good control of blood sugar levels through regular monitoring and adherence to treatment plans, which shows effective management of diabetes to insurers
• Adopt a healthy lifestyle with a balanced diet and regular exercise, which can help improve overall health and potentially reduce the risk of diabetes-related complications
• Avoid smoking and limit alcohol consumption, as these factors can negatively impact health and lead to higher insurance premiums
• Regularly visit healthcare providers for check-ups and management of diabetes, showing insurers that the condition is being actively monitored and managed
• Keep detailed records of your diabetes management, including medications, lifestyle changes, and doctor visits, to provide evidence of effective control to insurers
• Compare quotes from multiple insurance providers, as different companies may have varying criteria and rates for diabetics
• Work with an insurance expert who specializes in high-risk cases so you can find a policy that suits your specific health conditions

How to get life insurance with diabetes?

Getting life insurance with diabetes can be more challenging, but with the right approach, you can find suitable coverage. Here’s a step-by-step guide to help you:

Gather your medical information

• Collect recent medical records, including blood sugar levels, HbA1c test results, and any other relevant health information
• Prepare a list of all medications you are taking
• Note any lifestyle changes you’ve made, such as diet and exercise routines

Manage your diabetes effectively

• Regularly monitor and maintain your blood sugar levels within the target range
• Follow a balanced diet, exercise regularly, avoid smoking, and limit alcohol consumption
• Visit your healthcare provider regularly for diabetes management and check-ups

Provide accurate information

• Submit accurate and detailed records of your diabetes management, including medications, lifestyle changes, and doctor visits, to show that you are managing your condition well

Apply for insurance

• Complete the application process, which may include a medical exam for some types of insurance
• If a medical exam is required, prepare by fasting if instructed, getting a good night’s sleep, and avoiding strenuous activities beforehand

Review and choose the best policy

• Policy review: Carefully review the terms, conditions, and exclusions of your policy
• Cost vs. coverage: Balance the cost of premiums with the coverage provided to ensure it meets your needs and budget
• Final decision: Choose the policy that offers the best balance of coverage and affordability

Why does timing matter with life insurance for diabetics?

Timing matters when applying for life insurance as a diabetic because your current health status and diabetes management can significantly influence the premiums and coverage options you receive. Here are some reasons why timing is crucial:

• Stable condition: Applying when your diabetes is well-controlled and stable can result in more favorable premiums.  
• Recent health improvements: If you’ve recently made positive changes to your lifestyle, such as losing weight, quitting smoking, or improving your diet and exercise habits, waiting until these changes are reflected in your medical records can lead to better rates
• Medical advancements: If new treatments or medications for diabetes have been effective for you, showing a period of stability and improved health can work in your favor with insurers
• Age considerations: Life insurance generally becomes more expensive as you age, so, applying when you are younger and your diabetes is under control can help lock in lower rates.
• Health monitoring: Regular check-ups and maintaining detailed health records over time can demonstrate a consistent pattern of good diabetes management, which can be appealing to insurers
• Temporary health issues: If you have temporary health issues unrelated to diabetes, waiting until you recover from these conditions can help you avoid higher premiums that might result from a recent illness or medical event
• Gestational diabetes resolution: If you developed gestational diabetes during pregnancy and it has since resolved, waiting until you have a track record of normal blood sugar levels and stable health can improve your chances of obtaining better life insurance rates

Life insurance and diabetes: What can help or hurt your case

When applying for life insurance with diabetes, several factors can influence your application positively or negatively. Understanding these factors can help you navigate the process and potentially improve your chances of securing favorable rates.

What are some questions insurers may ask about your diabetes?

When applying for a policy that requires a health questionnaire or physical exam, insurers will ask about your general health, lifestyle, and family medical history. They will also have specific questions regarding your diabetes, such as:

• What type of diabetes do you have? Understanding whether you have Type 1, Type 2, or gestational diabetes helps insurers assess risk levels
• When were you diagnosed? The age of diagnosis can impact perceived risk, with earlier diagnoses potentially affecting rates
• Do you monitor your glucose levels regularly? Regular monitoring indicates effective management of your condition
• Are you taking insulin, oral medication, or both? If so, provide details on the number of insulin units per day, types of medications, and dosages
• What is your current diet and exercise routine? Your lifestyle choices can affect your overall health and diabetes management
• What is your current A1C level? This provides insight into your long-term blood sugar control
• What has been your average A1C reading over the past year? Consistency in A1C levels is important for assessing diabetes control
• Have you had any other tests related to your diabetes? This includes tests for complications or related conditions
• Who is your primary care doctor and when was your last visit? You may need to provide contact details for your healthcare team, including endocrinologists
• Do you have any diabetes-related complications? This could include high blood pressure, vision impairment, blackout spells, or kidney issues
• Have you been diagnosed with any other serious medical conditions? Conditions like coronary artery disease or kidney disease can affect insurance rates
• Have you ever experienced a diabetic or insulin coma? Such events may impact your risk profile and premiums
• Are you currently on dialysis? Dialysis indicates severe complications and can significantly affect insurance costs
• Have you had any recent hospitalizations or emergency room visits related to your diabetes? Recent health events can influence risk assessment
• Have you made any recent changes to your diabetes medication or treatment plan? Recent changes can affect your current health status and risk profile
• What is your current weight, and have you experienced any significant changes recently? Weight fluctuations can impact diabetes management and overall health
• Have you been advised by your doctor to make any lifestyle changes or undergo additional treatments? Shows ongoing medical advice and treatment adjustments

Frequently asked questions

What is the best type of life insurance for diabetics in Canada? 

The best type of life insurance for diabetics often depends on individual health conditions and needs. Generally, term life insurance may be more affordable, while permanent life insurance offers lifetime coverage and an investment component. Simplified issue and guaranteed issue life insurance policies might also be options for those who prefer not to undergo a medical exam.

Can diabetics get approved for life insurance in Canada? 

Yes, diabetics can get approved for life insurance in Canada. Approval and rates depend on factors such as the type of diabetes, control of blood sugar levels, and overall health. Insurance companies assess these factors to determine eligibility and premiums.

How much does life insurance cost for diabetics in Canada? 

The cost of life insurance for diabetics in Canada varies based on several factors, including the type of diabetes, age, overall health, and the level of coverage required. Premiums may be higher than for individuals without diabetes due to the increased risk associated with the condition.

When is the best time for a diabetic to apply for life insurance in Canada? 

The best time for a diabetic to apply for life insurance is when their diabetes is well-controlled and stable. Applying when you are younger and healthier can also help secure better rates. It is advantageous to apply after recent improvements in diabetes management or overall health.

Do all life insurance companies in Canada offer coverage for diabetics? 

Not all life insurance companies in Canada offer coverage for diabetics. Some insurers specialize in high-risk cases and may provide coverage options tailored to diabetics. It is important to compare policies and work with a broker who can help find insurers willing to offer coverage.

Can diabetics get a life insurance policy if they have been turned down before?

Yes, diabetics can get life insurance if they have been turned down before or denied coverage. Read more about your life insurance options when your application has been declined.

Whole life insurance is a type of permanent life insurance that offers lifelong coverage and a cash value component, making it both a protective and investment tool.

Unlike term life insurance, which lasts for a set period, whole life insurance remains in force as long as premiums are paid. This article explains whole life insurance and how it works so you can invest in a policy that keeps you and your loved ones protected.

What is a whole life policy in insurance?

A whole life insurance policy is a permanent life insurance plan that provides coverage for the insured’s entire lifetime, as long as premiums are paid. It offers both a death benefit and a cash value component.

The death benefit is the amount paid to beneficiaries upon the insured’s death, while the cash value is a savings feature that grows over time, offering guaranteed returns. In Canada, whole life insurance is popular because it combines protection with a form of savings or investment.

Whole life insurance is a powerful financial tool that combines lifelong coverage with a cash value component that can be used to achieve various financial goals. By leveraging the cash value policyholders can supplement their retirement income, plan their estates, and even grow their business. In this blog, we’ll answer a question many Canadians ask: how to use whole life insurance to create wealth.

Whether you’re looking to enhance your financial portfolio or secure your family’s future, a whole life policy can help you achieve both these goals. 

Why do you need life insurance?

Life insurance is essential for ensuring your loved ones are financially secure in the event of your unexpected passing. A life insurance policy can help cover expenses such as:

• Funeral costs
• Outstanding debts
• Mortgages
• Daily living expenses
• Children’s education
• Retirement planning 

A life insurance policy is a versatile financial tool that brings financial protection and peace of mind to you and your loved ones. 

How does whole life insurance work as an investment?

A whole life policy can help build wealth because of the two key components it offers: cash value for both participating and non-participating policies, and dividends for participating policies only. Policyholders can leverage either of these two components to create a source of income for various financial goals, supplement retirement income, fund large expenses, and even invest in new businesses. 

The cash value component and dividends (for participating policies) can be accessed in different ways. The cash value can be:

• Withdrawn 
• Accessed as a policy loan
• Used as a loan collateral

Withdrawing the cash value and taking a policy loan can be taxable if the amount exceeds the policy’s true value. When you use it as a loan collateral with a third party lender, it is not taxable. 

Dividends on the other hand can be used in two different ways:

• Policyholders can reinvest the dividends into their policy (enhanced protection and paid-up additions)
• Get paid in cash or hold on deposit 

When the dividends are reinvested into the policy, they are not liable to any taxes. If the policyholder chooses to get paid in cash or hold the dividend payout on deposit, it is subject to taxes. 

Whole life insurance for estate tax funding

When you pass away, it is assumed that you have disposed of all your assets and an executor will be required to pay any taxes before your estate is distributed among your beneficiaries. These assets include any Registered Retirement Savings Plan (RRSPs), capital gains, and more. 

The substantial value of these assets are also subject to the highest tax rates. Paying off these taxes significantly reduces the value that your beneficiaries get. 

If you pass away with an active whole life insurance policy, your beneficiaries (such as surviving family members) receive a tax-free cash payout from your insurance company. This payout is not considered part of your income or your beneficiaries’ incomes and is not taxed as such when you pass. This is because you paid your life insurance premiums using funds on which you paid income tax as well.

The payout from your whole life insurance policy offsets the taxes on your estate and provides immediate liquidity to meet any other estate settlement costs. 

Retirement planning with whole life insurance

While the primary purpose of a whole life policy is the death benefit, retired individuals can use the cash value component and the dividends to supplement their income. The cash value serves as an emergency fund that can be used for medical emergencies, paying off debt, travelling post retirement, children’s weddings or education, and more.

The dividends can be reinvested in the policy to increase the death benefit and to buy additional coverage. This will enhance the legacy a policyholder leaves for their loved ones. Depending on the dividend strategy, policyholders can also access it as cash when required. 

Using whole life insurance for businesses

Whole life insurance offers several benefits for business owners, including key person insurance, funding a buy-sell agreement, and serving as collateral for a business loan. A whole life policy ensures the stability and continuity of business operations. Here’s how:

Diversify your investment portfolio

A whole life insurance policy is a reliable way to diversify your investment portfolio. It offers stability and guaranteed cash value growth and death benefit, making it a more stable investment as compared to market-dependent assets. 

Whole life insurance keeps you protected against market volatility especially during downturns. 

What is whole life insurance?

Whole life insurance is a type of permanent life insurance that offers lifelong coverage, has a death benefit, and a cash value component, all of which remain active as long as premiums are paid. With its investment component, a whole life policy offers a unique blend of stability, growth, and flexibility, making it a powerful financial product. 

The death benefit is the amount paid to beneficiaries upon the insured’s death, while the cash value is a savings feature that grows over time, offering guaranteed returns. 

Key features of whole life insurance

The features of a whole life insurance policy can be different based on whether it’s a participating or non-participating policy. Participating policies allow policyholders to receive dividends, which can be used to reduce premiums, purchase additional coverage, or be taken as cash.

These dividends are not guaranteed but depend on the insurer’s financial performance. In contrast, non-participating policies do not offer dividends but often come with fixed premiums and guaranteed benefits, providing more predictable coverage.

Both types offer lifelong protection and a cash value component, but the choice depends on individual financial goals and risk preferences.

Features of a participating vs. non-participating whole life policy

Whole life insurance vs other investment options

When compared to other investment options such as stocks, bonds, or real estate, whole life insurance proves to be a lower risk choice. This is because of the guaranteed cash value and dividends (in case of participating policies). 

Here is how whole life insurance compares to other investment options:

Can you make money on whole life insurance?

Yes, you can make money on a whole life insurance using the cash value and/or the dividends your policy generates. Both cash value and dividends are living benefits and can be accessed in different ways. 

While the cash value is technically a portion of your death benefit, accessing it as a policy loan that you repay will ensure your policy’s value remains intact. You can use your cash value to for any small or large financial needs such as:

• Medical emergencies
• Weddings 
• Children’s education
• Supplementing retirement income 
• And more

The dividends can either be reinvested into the policy or taken as cash or deposit. If you take the dividends as cash or deposit, they may be subject to tax. Dividends can be used for similar purposes as cash value. 

Do wealthy people use whole life insurance?

Yes, wealthy people use whole life insurance to grow, protect, and transfer their wealth. The death benefit from a whole life policy is tax-free, making it an ideal inheritance for the wealthy. High-net worth individuals with a whole life policy that has a significant cash value component can use it to invest in their businesses, take out a collateral loan, plan their estates, and more.

Common misconceptions about whole life insurance

Whole life insurance is often misunderstood due to its complex nature and the different investment options it offers. Some of the common misconceptions about whole life insurance are:

• It is too expensive: The high premiums of a whole life policy include the death benefit and the cash value or dividends. The investment components also grow in a tax-deferred manner, offsetting the high initial premium costs
• Other investment options are better: Unlike stocks, bonds, mutual funds, and real estate, whole life insurance is not subject to market risks. It is a less volatile investment option
• Whole life insurance is for the wealthy: This is a common misconception owing to the high premiums. But whole life insurance is for anyone who is looking for lifelong protection with guaranteed returns

How long does it take to build up money in a whole life insurance policy?

A whole life insurance policy typically starts building cash value after a few years, often around the second or third year of the policy. In the early years, most of the premium payments go toward covering the cost of insurance and administrative fees.

The growth of cash value depends on the policy’s design, premium payments, and investment performance within the insurer’s portfolio. The timeline varies based on the policy structure and premium allocation.  

• Early years: Some cash value is generated, but most of the premium amount goes towards administrative costs 
• 3-5 years: Cash value begins accumulating meaningfully
• 10+ years: Cash value growth accelerates, benefiting from compound interest

Start building wealth with whole life insurance

A whole life insurance policy is more than just a safety net for your loved ones—it is a versatile financial tool that offers guaranteed growth while you are alive. If you want to build wealth with a whole life policy but are unsure of how to go about it, schedule a call with one of our licensed advisors. 

A return of premium (ROP) rider in critical illness insurance is an optional add-on that refunds the premiums you’ve paid if you don’t make a claim during the policy term or under specific conditions, such as surviving the term or passing away.

If you’re considering critical illness insurance, adding an ROP rider can help you feel more secure about your investment. This rider ensures that even if you never need to use the coverage, you’ll still benefit financially.

In this article, we’ll explain how the return of premium rider works and benefits your finances.

How does a return of premium work?

In critical illness insurance, return of premium riders are available usually as an add-on. With this rider, you pay your monthly premiums as usual, and the policy provides coverage for critical illness or disability claims.

However, if no claim is made or under specific conditions, the insurance provider refunds a portion or all of the premiums you’ve paid.

There are three common types of ROP:

• Upon death (Return of premium on death – ROPD): If you pass away while the policy is active, the insurer refunds all eligible premiums to your appointed beneficiary
• At the end of the contract (Return of premium on expiry): If the policy term ends without a claim, the insurer refunds the premiums paid
• On cancellation or surrender (Return of premium on cancellation/surrender): Some insurers offer partial or full premium refunds after a set number of years or at specific ages, like 65 or 75

Each provider has unique rules about how premiums are refunded and under what circumstances. To ensure you choose the right option for your needs, we recommend that you schedule a call with our experienced advisors.

What are the benefits of return of premium riders?

Return of Premium (ROP) riders provide peace of mind by refunding premiums, adding value to your insurance, offering flexible refund options, and reassuring risk-averse policyholders.

A return of premium rider:

• Ensures that you get a refund of premiums if no claim is made
• Turns your policy into a savings tool with either coverage or a payout
• Offers reassurance for those worried about losing their investment
• May offer refunds on expiry, surrender, or death, depending on the rider

What are the disadvantages of return of premium riders?

The disadvantages of return of premium riders are that they come with higher premiums, require long-term commitment, may exclude certain fees from refunds, and could limit potential investment opportunities.

• Higher premium costs: The rider significantly increases your policy premiums
• Long-term commitment: Requires maintaining the policy for the full term to benefit
• Limited returnable premiums: Refundable premiums may exclude certain fees or add-ons
• Opportunity cost: Extra premiums could be invested elsewhere for potentially higher returns

Which critical illness insurance providers offer return of premium riders?

Many Canadian insurance providers such as Beneva, Sun Life, RBC, Industrial Alliance, Desjardins, Manulife, Canada Life, and Empire Life offer return of premium (ROP) riders.

These riders are offered with different options like Return of Premium on Death (ROPD), Return of Premium on Expiry (ROPX), Return of Premium on Cancellation (ROPC), and other flexible refund features.

What is the cost of a return of premium rider in critical illness insurance?

The cost of adding a return of premium (ROP) rider in a basic critical illness policy costing $79.65 per month could be $117.99 per month

A return of premium rider significantly increases your critical illness insurance premiums, typically by 30–50%, depending on the rider type, insurer, and your policy details.

These costs also differ based on the type of return of premium rider:

• Return of premium on death (ROPD): Lower additional cost since it refunds premiums only if the insured passes away during the policy term
• Return of premium on expiry (ROPX): Higher cost as it guarantees a full refund of premiums if no claim is made by the end of the term
• Return of premium on surrender (ROPS): Costs are similar to ROPX but allow partial refunds if the policy is canceled early

Additionally, long-term policies like term-75 or lifetime coverage tend to incur higher premiums for ROP riders due to extended refund commitments.

Is a return of premium on critical illness taxable?

No, the return of premium (ROP) benefit on critical illness insurance is generally not taxable in Canada. When you purchase a critical illness insurance policy, you pay your premiums using after-tax dollars, meaning the money you use to pay for the policy has already been taxed.

Therefore, when you receive a refund of those premiums through an ROP rider whether upon expiry, surrender, or death, it is treated as a return of your personal contributions, not as income.

Comparison of return of premium riders with traditional critical illness insurance

Return of premium riders enhance critical illness policies by offering premium refunds, unlike traditional plans that provide coverage only. Here’s how these differ:

Premium refunds:

• ROP riders: Refund premiums if no claim is made (on expiry, death, or surrender)
• Traditional CI plans: Do not refund premiums regardless of claims

Cost:

• ROP riders: Typically 30–50% more expensive
• Traditional CI plans: More affordable but lack refund benefits

Flexibility:

• ROP riders: Allow refunds under specific conditions (expiry, death, surrender)
• Traditional plans: Offer no such options

Best suited for:

• ROP riders: Ideal for risk-averse individuals seeking financial security
• Traditional plans: Suitable for those focused on lower premiums

How do I get a return of premium coverage?

You can add a return of premium rider to your critical illness insurance policy while purchasing the plan or during eligible upgrade periods.

To get ROP coverage, you need to consult with your insurance provider to explore available rider options. Typically, a return of premium rider is added when purchasing a long-term critical illness policy. The process may involve assessing your eligibility based on age, health, and other criteria.

To qualify for ROP coverage, you must meet specific insurer requirements regarding age, policy type, and health status.

• Age requirements: Most insurers offer ROP riders to individuals aged 18–65
• Policy type: ROP is typically available on long-term critical illness policies, not short-term plans
• Health status: Eligibility may require passing a medical exam or meeting the insurer’s health guidelines
• Consistent premium payments: Some insurers mandate a history of timely premium payments
• Insurer-specific rules: Each provider may have unique conditions for adding ROP, such as coverage amount or policy terms

Getting individual or private life insurance to supplement your group life insurance plan is usually recommended to ensure you have adequate coverage. Almost 39% of life insurance policies in Canada are through group term insurance. With such a large number of Canadians covered through their work, many are under the impression that it’s enough coverage for their family too.

However, group life insurance plans have limitations and restrictions, and offer limited coverage. Read on to know more about group and individual life insurance plans, their advantages and disadvantages, and more.

What is life insurance?

Life insurance is an agreement between you and an insurance company that in the event of your demise, they will pay a lump sum, tax-free death benefit to someone you choose (your beneficiaries). In exchange, you agree to pay a premium to the insurance company. 

There are two main types of life insurance plans that an individual can choose from:

• Term life insurance that lasts for a specific period of time, generally 10, 20, or 30 years
• Permanent life insurance which covers you for your entire life and generates a cash value component. Some policies also pay dividends depending on your plan type

Life insurance can be bought by an individual (personal life insurance) or offered by an employer as part of a group plan. 

What is group life insurance?

A group life insurance is  a contract or an agreement that promises to pay an employee’s dependents a tax-free lump sum amount in the event of their demise. It is offered by an employer to a “group” of people—the employees. A group life insurance policy helps soften the financial impact that comes with losing an earning member of a family. 

Most group life benefits are offered as term life insurance that is renewed annually by the insurance provider. Unlike whole life insurance which covers an individual for their entire lifespan, term life policies provide coverage for a certain “term” or fixed period of time. 

Do I need individual life insurance if I am covered through work?

Yes, supplementing your group life insurance with individual life insurance coverage is highly recommended. Group life insurance plans generally payout up to one or two years of your salary. This may not always be enough for your family after you pass away. 

To ensure your family’s living expenses, your funeral fee, your children’s education costs, and other expenses, are covered, you need to get individual life insurance. When you buy an individual life insurance plan, you also get the option to get a participating whole life insurance policy. This type of policy gives you a cash value component and dividends, both of which can be accessed while you’re alive or after your demise. 

What is the difference between group and individual life insurance?

Group life insurance is offered by an employer to a group of people (the employees), while individual life insurance only covers the primary policyholder. Group life insurance plans offer limited coverage and the plan details are designed based on the employer’s budget and recommendations. Individual life insurance policies are customized to fit the needs of the policyholder. It lets policyholders choose their coverage amount, duration, and add additional riders to their core plan. 

What type of life insurance do employers offer as a group benefit?

Most employee life insurance is term life insurance. Although other types of permanent life insurance are also sometimes offered.

With group term life insurance plans, the death benefit is offered as a flat dollar amount, as a multiple of an employee’s annual salary (such as one or two times your annual salary), or a mix of both.

Do employers pay for group term life insurance?

Most private employers will pay for a substantial, if not the entire, portion of the premiums for group life insurance. The only thing to note: the coverage offered is typically basic. This means there is no customization or riders built in. The cost of additional supplementary coverage is usually paid for by the employee.

What are the benefits of group life insurance?

There are a number of benefits of group life insurance that make it an attractive option for those who are offered it through work or a professional association.

Affordability: An employer often pays for most – if not all – of the life insurance premium so there is very little or no cost to the member of the plan. If you do need to pay a portion of the premiums, they are usually less expensive. This is because the insurance company prices it on the basis of the underlying risk profile of the entire group as a whole rather than as an individual insurance applicant.

Convenience: It’s easy and convenient to sign up with only a small amount of paperwork and no individual underwriting. The payments are usually through payroll deduction, so no worries about policy lapsing because you missed your premium payments.

Limited underwriting: Most group term life contracts do not require any medical exam to be administered to the individual plan members. Members may be automatically or voluntarily enrolled in the overall group life insurance plan. However, an eligible employee may be required to go through medical underwriting, to establish good health in special circumstances such as when seeking an amount higher than the group coverage or when trying to rejoin the plan, after initially declining coverage.

What is the main disadvantage of group life insurance?

The main disadvantage of group life insurance is the one-size-fits all approach that assumes that every member of the group is likely to need the same amount of coverage. This is not always the case and life insurance coverage should be customized to individual needs. 

Other disadvantages of a group life insurance policy are:

Lack of control: Another disadvantage is that the plan sponsors (i.e. the employer or the organization) or even the insurance company can change the plan anytime they choose or even discontinue it altogether. Because you are sharing a plan among others in a group, it cannot be tailored to meet your own unique needs. There may be exclusions for medical conditions that you may have.

Limited portability: Group life insurance is dependent on an individual’s affiliation with the group. Just because one particular job includes insurance, there’s no guarantee that the next one will. If you find yourself in a position where you need to purchase life insurance once you make a career change, your premiums are likely to be much higher by then as you are a little older and more expensive to insure from an underwriting perspective.

Taxation: Lastly, depending on how your employer structured the benefit fees, you might need to pay taxes on the payout.

What happens to my group life insurance coverage if I leave my employer?

Employer-offered life coverage is linked to your employment. This means it covers you and your dependents until your employment period ends—whether you quit or you’re fired by the employer.

Many employer-offered plans include an option to convert the group coverage to an individual policy, upon leaving the employer. However, the cost of conversion from group to individual coverage is significantly higher and most people tend to get new individual coverage at that time. 

Typically, only those individuals who may have pre-existing health conditions, and may find it hard to get individual coverage based on a medical exam, will take advantage of this conversion option.

Does life insurance cover job loss?

No, life insurance does not cover job loss. It pays your beneficiaries a lump sum of money in the event that you, the employee, pass away. Job loss insurance is a separate insurance product. Disability insurance provides income replacement (usually 60-80%) in the event that you are injured or ill and can no longer work. 

Does group life insurance end at retirement?

Yes. Group life insurance is dependent on your continued employment; therefore, at retirement, your group life insurance also expires. However, as mentioned above, you will typically have the ability to convert the group plan into individual coverage, without providing any evidence of good health. The conversion has to be requested within a limited period of time, usually 31 days. The conversion option is much more expensive since no evidence of good health is provided.

Are my dependents covered through employer life insurance?

Sometimes. Most employer-offered life insurance plans will allow an employee to extend coverage to also include their dependents, such as married or common-law spouse and dependent children up to a certain age, such as 21 years. But that’s not always the case, so check your policy documents!

Is group life insurance a taxable benefit?

Yes, employer-paid life insurance is considered a taxable benefit. With group term life insurance paid by the employer in Canada, the premiums appear on your T4 slip and are reported on your tax return as a taxable benefit.

Whole life insurance typically costs between $45-$100 per month. However, 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.

What is whole life insurance?

Whole life insurance protects you for your entire life, making it one of the most popular permanent life insurance options in Canada. It pays 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.

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.

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. 

Whole life insurance quotes in Canada

*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.

How much is a $25,000 whole life insurance policy?

The cost of a $25,000 whole life insurance policy is typically $11 to $38 per month for young, healthy applicants. The exact premium depends on several factors, including the insured’s age, health condition, and gender, as well as the underwriting criteria of the insurance provider. These factors collectively determine the overall cost of coverage.

How much is a $50,000 whole life insurance policy?

The cost of a $50,000 whole life insurance policy varies based on age, smoking status, and gender. For example, a 20-year-old male, non-smokers pay around $26.82 per month, while smokers pay $29.61. At age 30, female non-smokers pay approximately $31.46, compared to $36.41 for smokers. 

The premium differences reflect the increased health risks associated with smoking and aging, highlighting the importance of maintaining a healthy lifestyle for affordable coverage.

How much is a $100,000 whole life insurance policy?

The monthly premium for a $100,000 whole life insurance policy typically ranges between $42 and $462. However, the exact cost depends on several factors, including the insured’s age, overall health, and lifestyle habits such as smoking. Additionally, the specific terms and underwriting policies of the insurance company can influence the premium amount.

How much is $500,000 life insurance?

For a $500,000 participating whole life insurance policy, premiums vary by age, gender, and smoking status. For a 30-year-old male, non-smokers pay approximately $232.15 per month, while smokers pay $280.93. At age 35, non-smokers pay around $311.14, compared to $358.93 for smokers.

For females, the premiums are slightly lower. A 30-year-old non-smoker pays about $193.27, while smokers pay $225.35. At age 35, non-smokers pay approximately $253.43, while smokers face premiums of $284.31. 

What is the cash value of a $10,000 whole life insurance policy?

The cash value of a $10,000 whole life policy depends on factors like the policy age, premiums, and dividends. In the illustration below, the table shows how the cash value of a $10,000 whole life insurance policy increases over time. Initially, the cash value is minimal, but it grows as premiums are paid and dividends accumulate. 

By age 40, the cash value reaches $40,412, with dividends boosting it further. At age 60, the cash value rises to $301,902, and by age 70, it exceeds $439,000.

By age 80, the cash value reaches $555,467, with dividends pushing the total value above $2 million, illustrating the long-term growth potential of the policy.

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.

What affects the cost of whole life insurance?

The cost of insurance in Canada can change depending on your age, gender, smoking status, lifestyle, occupation, policy type, etc.

• 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
• 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

How much do you get when you cash out a whole life insurance policy?

The amount you get when cashing out a whole life insurance policy depends on the policy’s accumulated cash value, which grows over time. Factors such as how long you’ve maintained the policy, premium payments, and any loans or withdrawals can impact your cash-out value. 

• Policy duration: The longer you’ve held the policy, the more time the cash value has had to grow through premium payments and interest accumulation
• Premium contributions: Higher or consistent premium payments can increase cash value over time
• Loans or withdrawals: Any outstanding loans or prior withdrawals reduce the death benefit
• Surrender charges: Cashing out early may result in surrender fees, which can significantly lower the payout amount
• Policy type and features: Some policies may offer dividends or other bonuses that add to the cash value

Before cashing out, consult with an insurance professional (like our experts at PolicyAdvisor) to understand the full implications and make sure it aligns with your financial goals.

What happens when you pay off whole life insurance?

Once you pay off a whole life policy, it becomes fully paid-up, meaning no further premiums are required. This type of policy is known as limited pay whole life insurance.

The policy remains active for life, and the death benefit stays intact. The cash value will continue to grow, and you can still access it through loans or withdrawals.

This is especially helpful if you are buying a whole life policy for your children. While you pay the premiums till your child is 20-years-old, they remain protected for life and have access to cash value that they can use for any future financial obligations such as education costs.

Here’s what a paid-up policy would look like for a 5-year-old child:

Whole life insurance costs by province

Whole life insurance premiums in Canada are influenced not only by personal factors like age and health but also by regional differences. While base rates remain fairly consistent, provincial variations can cause premiums to shift slightly above or below the national average.

Across all age groups and genders, the typical monthly premium for whole life insurance in Canada ranges from $150 to $250 for a $100,000 policy. However, where you live may affect where your rate falls within that range.

Higher-cost provinces

Alberta: Premiums are typically 5% to 8% above the national average, meaning monthly costs may range from $158 to $270. Higher incomes and lifestyle-related risk factors contribute to this increase.

British Columbia: Rates tend to be 3% to 5% higher, translating to premiums of about $155 to $262 per month, especially in urban centres.

Ontario: Generally aligns with the national average of $150 to $250 per month, though slightly higher rates may apply in cities like Toronto due to cost of living and underwriting considerations.

Lower-cost provinces

Quebec: Premiums are usually 2% to 4% below average, resulting in typical costs of $144 to $245 per month, helped by distinct regulatory conditions and efficient claims experience.

Maritime provinces (Nova Scotia, New Brunswick, PEI): Rates are often 1% to 3% lower, with monthly premiums around $146 to $248, due to stable population health and lower average claims.

Manitoba: Typically 1% to 2% below average, with costs around $147 to $248 per month, benefiting from moderate living expenses and consistent risk profiles.

Note: These provincial differences are estimates. Your individual premium will depend primarily on factors such as age, gender, health, smoking status, and coverage amount. For a precise quote, use our free calculator to compare options from top Canadian insurers.

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

Get a whole life insurance quote in Canada

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.

Great-West Life went through major changes in the company’s structure in 2020. The following is a brief history of Great-West Life Insurance, the current status of the company, and how to reach them regarding your policies.

History and Ownership: Great-West Life Assurance Company

Great-West Life Assurance Company was founded and incorporated in the year 1891 in Winnipeg, Manitoba. It wasn’t until 1942 that Great-West Life became the first Canadian company to enter into the accident and health insurance business.

Jeffrey Hall Brock started the company due to a lack of insurance options offered to Western Canadians at the time. The head office was developed within the “Exchange District” of Winnipeg, which is located on the corner of Rorie Street and Lombard Avenue.

Interestingly, in 1912, two Great-West Life policyholders were passengers on the Titanic, and the company covered their policies with no questions asked (Great-West Life was also responsible for the first death payout of a policyholder in 1893). The word assurance was used instead of “insurance” during these early days, as that was the term more commonly used throughout the British Commonwealth.

Merger and consolidation as Canada Life

Over the years they would become colloquially known as Great-West Life above anything else, although the beginning of 2020 brought a big change for the company. In 2019, the company announced it would be merging its brand with other companies under the same ownership, London Life and Canada Life.

The company is now known as Canada Life, although there are times where you will see references to Great-West Life through the transition period over the next few months and years. Rest assured, all of the policies you had before this merger will continue with the newly combined companies. These companies have a deep history in the Canadian insurance landscape.

London Life Insurance Company

London Life Insurance Company is almost 140-years old and was responsible for serving well over 2 million Canadians. They previously merged with Great-West Life in 1997 when they completed their first merger until the company merged again with Canada Life in 2003 while retaining its branding and still operating as a separate entity.

London Life is known for its “Freedom 55” motto, which refers to its financial services which aim to help their customers save enough money to where they can retire at the age of 55.

Canada Life Financial Corporation

Hugh Cossart Baker Sr. founded the Canada Life Assurance Company on August 21st, 1847. The firm was officially incorporated in 1849, and had to fight off a takeover bid by Manulife in 2003; this led to their eventual acquisition by the Great-West Life Assurance Company (through owner Power Financial Corporation) in that year.

The very first head office of Canada Life Assurance Company was located in Hamilton, Ontario, eventually moving to what is now known as the “Birks Building” (on King Street East and Hughson Street South in Hamilton). They moved several other times, once to the Canada Life Building that was finished development in 1895, and once more to their eventual Toronto headquarters in 1900.

Cawthra House was the company headquarters from 1926 to 1929 at King and Bay Streets in Toronto. They acquired and founded additional sister companies like Canada Life (UK) and Crown Life Insurance Company of Canada (CLICC).

What is Great-West Life Called now?

Canada’s Minister of Finance provided the final approval of amalgamation (the process of a company and their holding companies combining to become one large entity) of the Canadian insurers on November 25, 2019. The corporations and subsidiaries that were merged to create what we now know as The Canada Life Assurance Company are:

• Great-West Life Assurance Company
• London Life Insurance Company
• Canada Life Assurance Company (and their holdings)
• Canada Life Financial Corporation
• London Insurance Group Inc.

All of these companies operated as separate entities until January 1st, 2020 when the merger became official and The Canada Life Assurance Company began operation. Canada Life is now considered one of the country’s biggest life insurance companies and administers any insurance plan once owned by Great-West Lifeco.

Great-West Life Insurance products

Great-West Life offered many different types of insurance before the merger took place. Below you’ll find a list of the many products and investment management services that Great-West Life Insurance offered to their customers:

• Term Life Insurance
• Permanent Life Insurance
• Universal Life Insurance
• Disability, Critical Illness and Health Insurance Benefits
• Dental Insurance and other workplace benefits
• Financial Plan Services and Financial Security Advisors
• Wealth Management Products and Investments

What happened to my Great-West Life insurance policy?

Any insurance policies previously held with Great-West Life will now be serviced by Canada Life; you can find all of the information surrounding your coverage on the Canada Life website. As of January 1st, 2020, all of the contracts and policies associated with any of the merged companies transferred over to The Canada Life Assurance Company.

Amalgamation allows all of your policies and contracts to remain unchanged, so you will continue to benefit from their services as you would in the past. The Canada Life Assurance Company is dedicated to providing clients with the best coverage possible as they complete all aspects of this merger. The companies merged to provide improved customer service, more reliable coverage, and an overall better experience for all clients. Thus everything, like your contact details, benefits information, direct deposit and Groupnet details, your plan number, and more remains unchanged as your policy is served by the new Canada Life.

If you’re wondering how you can file a claim with Great-West Life Insurance, all you have to do is contact Canada Life for more information.

How do I submit a claim to Great-West Life?

You likely have questions surrounding your Great-West Life insurance policy and whether you’re still covered (the short answer is yes), and in turn, you might wonder who you’re supposed to contact. The goal of Great-West Life’s merger is to provide customers with a superior experience, as there are more assets to work with that will help improve their service and offer more flexibility in how they service their customers.

You don’t have to sign any paperwork or fill out any forms to ensure that your policies are carried over during the merger; this is an automatic process. That said, if you have any questions about submitting a claim, your policy, or your coverage details, you can always contact Canada Life for more information or access their support page (canadalife.com/support).

Websites and almost anything associated with Great-West Life is still being updated, which is why you may still see references to the recently merged company.

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.

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?

Pros and cons of holding multiple life insurance policies

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.

Nobody wants to think about their death, but the hard reality is that with ageing comes questions about those you may leave behind. This goes doubly so for couples. When you have a significant other, you both are invested in finding the best life insurance policy for couples. Finding coverage for the two of you provides peace of mind should anything happen to you both.

What are the benefits of taking one life insurance policy for couples?

Lower policy fees

As discussed above, combined and joint-life insurance policies allow a couple to take coverage under a single policy, which is a less expensive way of seeking life insurance as you pay a single policy fee.

For example: you and your partner recently bought a home and have taken out a joint mortgage to cover the cost. You secure your mortgage by taking a joint-first-to-die policy and avoid paying the two policy fees.

The joint coverage includes a single coverage amount; you both can decide this amount based on the outstanding mortgage and its amortization period. The benefit is paid out upon the death of the first insured person. The survivor can then use the money to pay off the mortgage loan.

A penny saved is a penny earned; why not save the extra policy fee while comfortably getting the protection you need? While the amount may seem nominal month-to-month, it can add up to hundreds, if not thousands of dollars saved over the course of the coverage period.

And, as mentioned earlier, you can determine separate coverage amounts and terms for each insured life with a combined policy. In this case, you can also ensure that coverage continues for the surviving spouse or partner if one passes away.

One contract to manage

Keeping track of paperwork and physical contracts on top of regular financial responsibilities can be a pain. With a single policy for a couple, only one contract is issued. You have the ease of reading, managing, and storing just one policy instead of two.

Conversion to permanent insurance

Typically, joint life insurance policies let the survivor convert their term policy into a permanent policy without medical underwriting upon the death of the other life insured as long as they are within the policy term. While not strictly necessary, it gives the surviving partner the option to cover themselves for their entire life. In the case of a multi-life policy, the conversion option is available on both the coverages within the unified contract.

When is the best time to apply for life insurance as a couple?

The best time to get a life insurance quote is always as soon as possible, as your rates will generally be less expensive in your earlier years. However, this is the easy answer. Couples have many trigger points that ad urgency to their life insurance needs. These can include moving in together, getting married, buying a home, getting a pet, or having children just to name a few.

Where can you get life insurance for couples?

While every couple’s situation and needs may vary, joint and combined policies are an excellent fit for those looking to save on money whilst getting the protection they require for their common needs.

Most of Canada’s best insurance companies offer various options for couples’ life insurance. Speak to our advisor today; they can discuss all the options at your disposal and help you choose the right policy and life insurance company for you and your partner’s needs.