About Empire Life

Empire Life is one of Canada’s most established insurers, recognized for consistent performance, client-focused service, and strong financial strength, including an A rating from A.M. Best. Founded in 1923, Empire Life’s whole life insurance offers lifetime coverage through participating and non-participating plans. 

A key feature of Empire Life’s is its participating whole life insurance plans, EstateMax and Optimax Wealth, which are supported by a disciplined $1.32 billion par fund. With nearly a century of experience, Empire Life offers coverage that balances predictable growth, reliable cash value accumulation, and flexible options for long-term financial goals. 

Empire Life’s financial strength:

Disclaimer: Figures and ratings are based on the latest available information and may change over time

What is Empire Life whole life insurance?

Empire Life whole life insurance is a type of permanent life insurance designed to provide lifetime protection. Its portfolio includes non-participating policies, which provide guaranteed benefits and cash values, and participating policies, which provide guaranteed benefits while also giving policyholders the potential to receive dividends based on the performance of the insurer’s participating account.

Empire Life offers two participating plans, EstateMax and Optimax Wealth, and two non-participating plans, Solution 100 and Term to 100. Both EstateMax and Optimax Wealth offer coverage of up to $20 million, with limited-pay options including 10-pay, 20-pay, and life-pay. Optimax Wealth also offers an 8-pay option, giving policyholders an additional way to pay premiums over a shorter period.

Among the non-participating plans, Term to 100 is suited for those seeking permanent insurance protection without cash value benefits, while Solution 100 is designed for those who want permanent protection with access to cash values. Both plans can also be customized with riders, including waiver of premium, guaranteed insurability, accidental death and dismemberment, and others.

Key features of Empire Life whole life insurance:

Who is eligible for Empire Life whole life insurance?

Empire Life whole life insurance is designed for:

• Canadian residents who meet Empire Life’s underwriting requirements
• Individuals within the applicable issue ages: 18-75 for Term to 100; 0-75 for Solution 100; and 0-75 for EstateMax and Optimax Wealth under single-life coverage. Joint coverage for EstateMax and Optimax Wealth is available from ages 18-75
• Applicants seeking at least $ 10,000 in coverage (can vary depending on the age)

Key benefits of Empire Life whole life insurance

Empire Life whole life insurance offers lifelong protection with options for growth, stability, and estate planning. It combines guaranteed lifetime coverage with dividend-earning potential or guaranteed cash values, depending on the plan type. Here are its key benefits:

• Lifetime coverage: Your policy remains in force for life
• Death benefit: Provides a tax-free death benefit to beneficiaries when the insured person dies, provided the policy remains in force
• Fixed level premiums: Premium payments stay the same throughout your chosen premium-pay period
• Dividend potential (for participating plans): Eligible policies may receive annual dividends, which can be used to buy paid-up additions, reduce premiums, withdraw as cash, or earn interest
• Cash value: Cash values are available for all types, except Term 100 may depending on the circumstances
• Flexible payment choices and riders: Choose shorter pay options (10-pay or 20-pay) or life-pay for flexibility. Add riders such as accidental death, child term insurance, or disability waiver for customized coverage
• Living benefit: This is a non-contractual benefit that is approved on a case-by-case basis. It provides up to 50% of the death benefit, to a maximum of $50,000, if the insured is diagnosed with a terminal illness and has 12 months or less to live

Types of Empire Life whole life insurance

Empire Life offers four whole life insurance plans, including two participating plans and two non-participating plans. These plans are designed to meet different financial goals and payment preferences.

Participating whole life plans by Empire Life:

• EstateMax
• Optimax Wealth

Non-participating whole life insurance by Empire Life:

• Solution 100
• Term to 100

About Empire Life’s participating whole life insurance plans

Empire Life’s participating whole life plans provide lifetime protection, guaranteed premiums, and the potential for steady long-term cash value growth. Like all participating policies, they may earn annual dividends based on the performance of Empire Life’s participating account, which invests in a mix of bonds, equities, and real estate. While dividends aren’t guaranteed, they offer an opportunity to enhance coverage and overall policy value.

Currently, Empire Life offers two participating whole life plans:

EstateMax: Best for long-term estate and wealth transfer

EstateMax is built for Canadians who want strong long-term cash value growth. It’s ideal for those focused on estate planning or leaving a larger legacy. Coverage starts at $10,000 for ages 0-17 and 66-75, and $25,000 for ages 18-65. It offers 10-pay, 20-pay, and life-pay options, with dividend choices including paid-up additions, premium reduction, cash, enhanced coverage, and interest on deposit. The guaranteed cash value starts accumulating from year 5.

Optimax Wealth: Best for early cash value access

Optimax Wealth is designed for those who want faster early cash value build-up and lifetime coverage. It emphasizes liquidity and flexibility, allowing policyholders to access value early through loans or withdrawals to fund opportunities such as education, business expansion, or wealth-building goals.

It offers the same coverage range and limited-pay options as EstateMax, with the addition of an 8-pay option. Optimax Wealth also offers riders such as accidental death, child term, guaranteed insurability, and disability waiver, along with the optional Additional Deposit Option (ADO) for accelerated growth.

Key differences between EstateMax and Optimax Wealth:

About Empire Life’s non-participating whole life plans

Empire Life’s non-participating whole life plans provide straightforward lifetime protection with fixed premiums and guaranteed death benefits. No dividends are payable on non‑par plans. These plans are built for Canadians who want simple, predictable coverage without market fluctuations or dividend variability.

Non-participating plans can help meet goals such as estate preservation, funding final expenses, or leaving a small legacy for children, grandchildren, or charities. Currently, Empire Life offers two non-participating whole life plans:

Solution 100: Best for guaranteed value and flexibility

Solution 100 provides permanent coverage with fixed premiums and guaranteed cash surrender values that begin in policy year 10. It’s ideal for Canadians who want lifelong protection but also appreciate some accessible policy value if their needs change. The policy can be customized with riders such as waiver of premium, guaranteed insurability, AD&D, children’s life, and children’s critical illness riders, among others.

Term to 100: Best for simple, low-cost lifetime protection

Term to 100 offers permanent coverage with fixed premiums and no cash value. It’s a lower-cost option focused purely on lifetime protection, ideal for those who want straightforward coverage for estate or final-expense needs. It offers life pay, with guaranteed level premiums to age 100, and a 20-pay option, with guaranteed level premiums for 20 years. Like Solution 100, Term to 100 can also be customized with riders at an additional premium.

Key differences between Solution 100 and Term to 100:

Pros and cons of an Empire Life whole life insurance policy

Empire Life whole life insurance offers several advantages, from flexible coverage options to unique wealth-building features, along with a few limitations depending on your age and plan type. Let’s take a closer look at the pros and cons of Empire Life Whole Life insurance below:

How much does Empire Life whole life insurance cost?

The cost of Empire Life whole life insurance for a male or female seeking $100,000 in coverage under a 20-pay participating whole life insurance plan ranges from $1,321 to $7,401 per month. The actual premium may vary based on factors such as your age, gender, coverage amount, payment option, and a few other factors.

Cost of Empire Life whole life insurance (2026):

*Illustrating monthly cost of $100k coverage for a participating whole life insurance for 20-pay

Empire Life’s Dividend Scale Interest Rate (DSIR) history

The DSIR reflects Empire Life’s internal expectation of net returns after taxes, claims, and expenses. It is not a return paid directly to policyholders but drives dividend projections. Dividends depend on investment results, policyholder experience, and participating account surplus, and are approved annually by the Board. While dividends are not guaranteed, Empire Life’s narrow 6.0–6.25% band over the past decade showcases its disciplined approach.

Which limited pay whole life insurance plans are available from Empire Life

Empire Life’s EstateMax and Optimax Wealth plans offer predictable long-term growth through a disciplined, conservative investment approach. These participating plans provide lifetime protection with 8-pay, 10-pay, 20-pay, and life-pay options. The 8-pay option is available only with the Optimax Wealth plan.  Limited-pay options allow policyholders to pay premiums over a set period while keeping their coverage in force for life.

What is Empire Life’s side account?

Empire Life’s EstateMax and Optimax Wealth plans include a side account that can hold money for future premiums, policy fees, and rider costs. The account earns interest set by Empire Life, but because it is held outside the policy, the interest earned is taxable. Funds can be withdrawn at any time and are paid to the policyowner on surrender or to beneficiaries upon death. Funds in the side account can be used to pay future base premiums, policy fees, and premiums for eligible riders and additional benefits.

Can I get any living benefits with Empire Life?

Yes, Empire Life offers a Living Benefit Advance on all its life insurance policies as a non-contractual benefit. This benefit means that if the insured is diagnosed with a terminal illness with a prognosis of 12 months or less, they may receive 50% of the death benefit, up to $50,000. The advance plus interest is deducted from the death benefit when the claim is paid.

What is Empire Life’s Kid Start strategy?

Empire Life’s Kid Start is a whole life insurance strategy that uses the tax advantages of individually owned life insurance to help give children or grandchildren a financial head start. It involves purchasing EstateMax or Optimax Wealth when the child is young and healthy, allowing the policy to build cash value that can later be accessed through policy loans or cash value withdrawals. The policy can also be fully paid-up in 8, 10, or 20 years, while ownership can be transferred to the child at the age of majority or later.

What is Empire Life’s Additional Deposit Option?

Empire Life’s Additional Deposit Option (ADO) is available on eligible EstateMax and Optimax Wealth 10-pay, 20-pay, and life-pay participating whole life plans. It allows policyholders to make additional deposits to accelerate cash surrender value growth and increase life insurance. ADO is available for issue ages 0 to 75 and can be used with either paid-up additions or enhanced coverage dividend options. ADO deposits are optional and can be stopped anytime, at the will of the policyholder. 

How does Empire Life compare to other whole life insurance providers?

Empire Life stands out for offering both participating and non-participating permanent life insurance, giving Canadians a choice between dividend potential and straightforward guaranteed protection. Its participating plans, EstateMax and Optimax Wealth, offer lifetime coverage, multiple premium-payment options, and the potential to earn dividends, while Optimax Wealth is one of the few plans to offer an 8-pay option. Its non-participating plans, Solution 100 and Term to 100, provide guaranteed lifetime protection, with Solution 100 also offering guaranteed cash values. To see how Empire Life compares with other leading insurers, read our guide to the best whole life insurance companies in Canada.

Our advisor’s take on Empire Life whole life insurance

At PolicyAdvisor, one of our expert advisors helped a 40-year-old client looking for permanent life insurance that could provide family protection while also building cash value over time. The client was particularly interested in participating whole life insurance, with the potential to earn dividends and access cash value during their lifetime. 

Client profile:

• Age: 40-year-old non-smoking Canadian
• Coverage need: $500,000 in permanent life insurance for family protection and long-term financial planning
• Primary concern: Building cash value while maintaining guaranteed lifetime protection and flexible premium-payment options
• Our comparison: We compared Empire Life’s EstateMax and Optimax Wealth with participating whole life products from other leading Canadian insurers, focusing on dividend potential, cash value growth, limited-pay options, and policy flexibility

Why Empire Life stood out:

• Choice of participating plans: Empire Life offers EstateMax for long-term estate and wealth planning and Optimax Wealth for those who prioritize earlier cash value growth
• Flexible premium-payment options: Empire Life offers 10-pay, 20-pay, and life-pay options on both participating plans, while Optimax Wealth also offers an 8-pay option for those who want to complete premium payments sooner
• Multiple ways to use dividends: Policyholders can choose from several dividend options, including paid-up additions, premium reduction, cash payouts, and leaving dividends on deposit to accumulate

How to buy Empire Life whole life insurance with PolicyAdvisor?

Ready to buy Empire Life whole life insurance? Get a personalized Empire Life whole life illustration and compare it to top Canadian insurers with PolicyAdvisor’s licensed experts.

Get covered in three easy steps:

• Speak with a licensed PolicyAdvisor expert
• Review Empire Life non-participating and participating plans, EstateMax and Optimax Wealth, alongside plans from other top Canadian insurers
• Receive a personalized illustration and finalize your application online

PolicyAdvisor’s licensed experts help you compare options and find the perfect plan for your lifetime coverage and financial goals.

RBC Insurance, backed by one of Canada’s largest banks, offers participating whole life insurance policies that build cash value, provide guaranteed lifelong protection, and the potential to receive policyholder dividends. RBC provides two whole life plans: Growth Insurance and Growth Insurance Plus, each with distinct features. While the former offers coverage starting at $25,000, Growth Insurance Plus starts at $250,000.

Quick review:

• PolicyAdvisor ratings: 4/5
• Best for: Parents seeking permanent coverage for children with a Juvenile Guaranteed Insurability Benefit
• Skip if: You want a 10-pay policy with the option to make additional deposits

About RBC Insurance

Recognized as Canada’s largest bank-owned life insurance company by total revenue, RBC Insurance serves almost 5 million clients globally. In addition to whole life insurance, RBC Insurance also specializes in offering health, home, auto, travel, wealth, and reinsurance advice and solutions to individual, business and group clients. Moreover, with a LICAT ratio of 132%, RBC demonstrates strong financial strength. Its estimated par fund size is $51.39 million, and it has maintained a stable dividend rate over the past few years.

RBC Insurance’s financial strength:

Disclaimer: Figures and ratings are based on the latest available information and may change over time

What is RBC whole life insurance?

RBC whole life insurance provides permanent life insurance coverage with guaranteed cash value growth. It has two participating whole life plans: Growth Insurance and Growth Insurance Plus; both offer limited pay options: 10-pay, 20-pay, or Life pay to age 100 and the flexibility to choose the coverage option from single life, joint first to die, and joint last to die. 

RBC Growth Insurance is available with guaranteed cash value starting at the end of the fifth policy year. RBC Growth Insurance Plus is designed to accelerate tax-deferred growth and provides access to guaranteed cash value from the end of the first policy year. Both plans offer five dividend options, including paid-up additions, cash, premium reduction, dividends on deposit, and enhanced insurance.

Key features of RBC whole life insurance:

Who is eligible for RBC whole life insurance?

RBC whole life insurance is designed for:

• Canadian residents who satisfy RBC Insurance’s underwriting guidelines
• Individuals aged 0 to 80 for single-life coverage and 18-80 years for joint-life policies, with specific eligibility for the Juvenile Guaranteed Insurability Benefit for children aged 0 to 17
• Applicants seeking a minimum of $25,000 in coverage for RBC Growth Insurance or $250,000 for RBC Growth Insurance Plus

What is covered under RBC whole life insurance?

RBC’s Growth Insurance and Growth Insurance Plus whole life insurance plans include the following:

• Death benefit: Provides a tax-free death benefit to beneficiaries when the insured person dies, as long as the policy remains in force
• Guaranteed cash value: Builds cash value over time, which can be accessed through policy loans or withdrawals, subject to the policy terms
• Dividend potential: Participating policies may earn dividends based on the insurer’s performance. The available dividend options include cash, premium reduction, dividends on deposit, paid-up additions, and enhanced insurance. Dividends are not guaranteed
• Optional coverage: Policyholders can add optional benefits and riders to customize their coverage based on their financial and protection needs

What are the different types of RBC whole life insurance?

RBC offers two participating whole life plans with lifetime coverage, guaranteed cash value growth, and the potential to earn dividends: RBC Growth Insurance and RBC Growth Insurance Plus. The premiums from participating policyholders are pooled in RBC’s participating account, and dividends may be paid based on the account’s experience.

• Growth Insurance: Coverage ranges from $25,000 to $25 million. This option is designed for individuals seeking permanent life insurance with long-term cash value growth. Guaranteed cash value becomes available at the end of the fifth policy year. It also includes the Juvenile Guaranteed Insurability Benefit, which allows the policyholder to purchase additional insurance after the child turns 18 without providing additional evidence of insurability
• Growth Insurance Plus: Offers almost the same core benefits of permanent coverage, cash value accumulation, and dividend potential, but is designed for faster cash value growth. Coverage ranges from $250,000 to $25 million, and guaranteed cash value is available from the first policy year, providing earlier access to guaranteed cash value compared with Growth Insurance

RBC Grow Insurance vs Grow Insurance Plus:

What are the dividend options available with RBC whole life insurance?

The dividend options for Growth Insurance and Growth Insurance Plus are the same. Annual dividends can be issued as:

• Cash: You can receive your dividends as cash, though they may be taxable
• Premium reduction: Dividends are applied to your premiums for the following year. Any excess dividends are paid to you directly
• Dividends on deposits: Dividends are deposited into an interest-bearing account, which you can access anytime. Any interest earned is taxable
• Paid-up additions: This option uses dividends to buy additional insurance coverage. The added coverage can earn dividends and build its own cash value over time
• Enhanced insurance: Your dividends can also be used to buy a mix of paid-up additions and one-year term insurance. The insurance purchased using paid-up additions can earn dividends and build cash value in the future

Pros and cons of RBC’s whole life insurance

RBC’s whole life insurance plans offer several advantages: multiple payment and dividend options, flexible use of cash value. However, there are also some downsides, like restricted deposit-option eligibility and delayed guaranteed cash value in Growth Insurance.

How much does RBC whole life insurance cost?

The cost of RBC whole life insurance for a male or female seeking $100,000 in coverage for participating whole life insurance for 20-pay ranges between $184 and $619 per month. The actual premium you pay, however, may vary based on factors such as your age, gender, coverage amount, payment option, and underwriting profile.

Cost of RBC whole life insurance (2026):

*Illustrates the monthly cost of $100,000 in participating whole life insurance coverage with a 20-pay option and paid-up additions dividends

Manulife offers permanent life insurance through Manulife Par, a participating whole life insurance policy designed to provide lifetime protection while building cash value over time. The policy combines guaranteed premiums, a guaranteed death benefit, and cash value growth with the potential to earn annual dividends. Manulife whole life insurance plans also come with limited pay options such as pay 10, pay 20, pay-to-90, and pay-to-100. Eligible applicants can also choose Manulife Par with Vitality Plus, which adds Manulife’s wellness rewards program and additional Vitality-related benefits to the core Manulife Par coverage.

Quick review

• PolicyAdvisor ratings: 5/5
• Best for: Added wellness rewards through the Vitality program
• Skip if: You want a broader range of dividend options than cash or paid-up insurance

About Manulife

Manulife operates as one of Canada’s largest participating life insurance platforms, supported by a $15.98 billion participating account. Its participating whole life insurance policies allow policyholders to share in the performance of the participating account through annual policy dividends, subject to the insurer’s dividend scale. For 2026, Manulife has maintained a 6.35% DSIR for participating whole life insurance policies.

Manulife’s financial strength

Disclaimer: Figures and ratings are based on the latest available information and may change over time

What is Manulife whole life insurance?

Manulife whole life insurance is permanent life insurance that stays in place for life as long as the policy remains in force. Manulife’s core plan name is Manulife Par, and there is an option to opt for Manulife Par with Vitality Plus, which provides access to Manulife’s Vitality program. Both options offer cash value growth and guaranteed access to cash value in the early years. For 10-pay, 20-pay, and pay to age 90 plans, the coverage starts at $100,000. For pay to age 100, the coverage starts at $500,000. 

Manulife Par with Vitality Plus™ gives the policyholder individual access to the maximum-value benefits of Manulife Vitality, the company’s flagship rewards program. Manulife Par with Vitality Plus™ offers only single life coverage, while Manulife Par offers single life and joint-last-to-die coverage options.

Key features of Manulife whole life insurance

Who is eligible for Manulife whole life insurance?

Manulife whole life insurance is available to those who meet the following requirements:

• Canadians who meet Manulife’s underwriting requirements
• Individuals aged between 0 and 80 years and 18-80 years for Manulife Par with Vitality Plus
• Individuals seeking at least $100,000 in coverage, although minimum coverage varies by payment option

What is covered under Manulife whole life insurance?

Manulife whole life insurance provides lifelong financial protection, with the policy’s key benefits including:

• Lifetime coverage: A guaranteed death benefit is paid to beneficiaries when the insured dies, or after the last death for joint last-to-die coverage
• Guaranteed cash value: The policy builds guaranteed cash value over time that can be accessed through withdrawals or policy loans
• Potential dividends: Participating policies may receive non-guaranteed dividends that can be taken as cash or used to purchase additional paid-up insurance
• Optional riders: Additional protection can be added through riders such as term insurance, total disability waiver, guaranteed insurability, and child protection riders
• Vitality benefits: Eligible policyholders can access wellness features and rewards through Manulife Vitality, depending on the policy and the insured person’s Vitality Status

Types of Manulife Par whole life insurance

Manulife’s core participating whole life insurance product is Manulife Par, with an enhanced version that has Vitality Plus built in.

• Manulife Par: A participating whole life insurance plan that provides lifetime coverage, guaranteed premiums, guaranteed cash value growth, and a guaranteed death benefit. Policyholders may also receive annual dividends, which can be used to enhance the policy’s cash value and insurance coverage. The available coverage options are single life or joint last-to-die and include Vitality Go™ at no additional cost. The Vitality Go™ rewards you for leading a healthy lifestyle. Also, note that Vitality Go members can upgrade to Manulife Par with Vitality Plus anytime before the policy’s third anniversary
• Manulife Par with Vitality Plus: This version keeps the core participating whole life features of  Manulife Par while building the Vitality Plus wellness program into the policy. With this policy, policyholders can earn rewards for participating in activities that promote healthier living, while the policy continues to provide guaranteed benefits and the potential for annual dividends. Manulife Par with Vitality Plus is available as single life coverage only

Manulife Par and Manulife Par with Vitality Plus:

Pros and cons of Manulife whole life insurance

Manulife’s participating whole life policies offer a range of benefits such as immediate cash value growth, the option to choose the frequency and duration of premiums, and access to riders. Manulife also offers deposit option payments where the insured individuals can make direct premium payments and increase their protection. 

A downside of Manulife’s whole life insurance is that Manulife does not offer non-participating plans, and some policy owners may find the dividend and returns structure complex.

How much does Manulife whole life insurance cost?

The cost of Manulife whole life insurance for a 20-pay whole life insurance policy with $100,000 in coverage ranges from $246.20 to $620.71 per month. In the table below, we have listed the cost for a male and a female and how they vary with age. 

Cost of Manulife whole life insurance (2026):

*Illustrative monthly premiums for $100k of participating whole life insurance with a  20-pay premium period

Whole life insurance is a popular kind of life insurance in Canada, offering lifelong coverage while building cash value over time. Participating whole life policies may also provide non-guaranteed dividends, providing additional opportunities to grow the policy value. Since whole life combines permanent financial protection with additional benefits, it can be a valuable tool for long-term financial planning.

Is whole life insurance a bad investment?

No, whole life insurance is not a bad investment option. It is primarily a permanent life insurance option that provides guaranteed lifelong coverage while building cash value. Whether it is a good choice or not depends on your financial goals and the duration of protection you are seeking for your beneficiaries.

Essentially, if you are only looking to temporarily replace income or secure a short-term financial obligation, a term policy will provide a basic, temporary safety net. However, if you are seeking to leave an inheritance or planning a tax-free inheritance for your family, a whole life policy may be a better fit for your needs.

Common misconceptions about whole life insurance

Many people view whole life insurance as a bad investment because of common misconceptions around its higher premiums, slower cash value growth, and lower returns compared with market-based investments. Let’s separate the myths from the facts and look at what whole life insurance actually offers:

Myth #1: Whole life insurance is a bad investment

Whole life insurance is sometimes compared directly with investment options like stocks, mutual funds, or ETFs. However, this comparison fails to consider that whole life is primarily an insurance product.

Whole life insurance is purchased to provide a guaranteed death benefit, while also building cash value in the process. Essentially, it is better to regard whole life insurance as a long-term insurance and financial-planning tool rather than as a direct alternative for investment-focused options like stocks or other conventional methods.

A whole life insurance policy offers a guaranteed death benefit when you pass away, providing your beneficiaries with funds for financial protection and to cover final expenses. This makes it a great tool for leaving an inheritance or for tax-advantaged estate planning. Alongside this, the policy also grows cash value and non-guaranteed dividends over the years.

This cash value can be used as a policy loan, withdrawn, or even used as collateral in an eligible third-party loan. Additionally, if the policyholder receives dividends, they can use them to purchase additional paid-up insurance or reduce premiums.

Myth #2: Whole life insurance is too expensive

Permanent life insurance policies are indeed more expensive than term life insurance. In fact, whole life insurance premiums can be as much as 5 to 15 times more expensive than term policies. This difference can be significant for those looking for a more budget-friendly life insurance policy or higher coverage amounts at lower premiums.

However, this difference in premium cost is not without reason. Whole life insurance offers lifelong coverage, cash value, and an investment component in participating policies. Unlike term insurance, whole life coverage is designed to last a lifetime. It is also worth noting that many whole life policies offer guaranteed and level premiums. If you apply when you are younger and healthier, you essentially qualify for more reasonable rates. 

With term life insurance, your premiums may increase with each term renewal or new application, since the cost is based on attained age and other underwriting criteria. Therefore, comparing term and whole life based on the initial premium alone does not provide a complete picture.

Myth #3: You have to surrender your policy to access the cash value

You do not necessarily have to surrender your whole life insurance policy to benefit from its cash value. While surrendering your policy gives you access to the accumulated cash value, you can also use that value in other ways. Depending on your policy and the terms, you may also be able to:

• Make a partial withdrawal
• Take a policy loan against the cash value
• Use the policy as collateral for a loan

This flexibility can be useful for business owners and corporate-owned policies. A business owner can borrow against the policy or use it as collateral and reinvest the borrowed funds into the business for expansion, acquisition, or other expenses without having to surrender the policy. As long as the policy remains in force, the coverage continues.

Is term life insurance better than whole life insurance?

Neither is universally better since the two policies solve different financial needs. While term is meant to offer protection for temporary financial obligations such as mortgages or loans, whole life policies are meant for lifelong coverage and wealth preservation.

Let’s say you purchase a ten-year term life insurance policy with $50,000 in coverage. The cost of term life premiums will be less than those for a whole life policy with the same coverage of $50,000. If you die during those 10 years, the term policy provides the same $50,000 death benefit at a lower premium cost. However, if you outlive the term and allow the policy to expire, your coverage ends. 

On the other hand, whole life stays in force for life and provides a guaranteed death benefit whenever you die, as long as the premiums are paid. The major difference is that term life insurance protects against the possibility of passing away during a selected term, whereas whole life insurance is designed to provide coverage until the policyholder passes away.

If you are seeking to protect outstanding debts or short-term obligations like mortgages, term life insurance is the way to go. However, if you are looking for permanent protection while also building cash value, whole life insurance may be more aligned with your financial needs.

Should you use whole life insurance for retirement planning in Canada?

Whole life insurance can complement retirement and estate planning, particularly when you already need lifelong coverage. A participating life insurance policy can build cash value on a tax-advantaged basis and may provide non-guaranteed dividends. 

However, whole life insurance should generally complement conventional savings options such as RRSPs and TFSAs. The key to this balance is structuring the policy so that the premiums and future policy value support your retirement goals.

Here are some factors you should keep in mind while using whole life insurance for retirement planning in Canada:

• Budget whole life premiums before retirement: If you expect to continue paying premiums after you retire, it is important to factor those payments into your projected retirement expenses
• Consider a limited-pay whole life policy: Limited-pay whole life policies allow you to complete your scheduled premium payment over a much shorter period, while maintaining lifelong coverage. This can help you finish paying premiums before retirement.
• Use participating policy dividends: If you receive dividends from participating policies, you can use them to purchase additional paid-up insurance or reduce premiums, making it great for retirement planning.

For a detailed overview, check out our guide on Whole life vs. RRSP vs. TFSA: Which builds more wealth in Canada?

Who should buy whole life insurance in Canada?

Whole life insurance is particularly valuable if you are seeking lifelong protection or want to use it as part of a broader strategy involving estate planning or wealth transfer to your beneficiaries, owing to the tax-free payout and tax-deferred growth.

Here are situations when whole life insurance in Canada makes sense:

You need permanent life insurance

Whole life insurance can provide coverage for final expenses, lifelong dependants, estate obligations, or other permanent needs. It is designed for broader protection, rather than covering temporary financial obligations like home loans or debts.

You are a high net worth individual

Whole life insurance is a great tool for high net worth Canadians who have already made effective use of conventional savings and investment strategies. The policy can help in broader estate and tax-deferred wealth-transfer planning. It offers an efficient way of transferring wealth to beneficiaries while providing permanent life insurance protection.

You want to leave an inheritance

Whole life insurance can create a guaranteed inheritance or fund for your beneficiaries such as children and grandchildren, provided you continue to pay your premiums until your death or until the end of the specified policy period.

You are a business owner

If you are a business owner, you can use whole life insurance to provide liquidity after you pass away. The death benefit can be used as a cash flow injection that can also help in funding shareholder agreements or to help address operational or structural challenges the business may face after the owner’s passing.

Who may want to skip whole life insurance?

While whole life is great for those seeking extended coverage for the duration of their lives, it might not be the perfect fit for individuals seeking affordable coverage or short-term protection. If you have temporary or reducing financial obligations, such as a mortgage or outstanding loans, a term life policy will offer you a higher coverage amount at similar premiums.

Similarly, if investment growth is your priority and you do not need permanent life insurance, whole life insurance may not be the right fit for you. Instead, you can invest in traditional options such as mutual funds, stocks, or ETFs.

Final verdict: Is whole life insurance actually bad?

No, whole life insurance is not inherently bad. It provides lifelong protection while building cash value, making it a good investment for Canadians planning long-term coverage. It is particularly well-suited for individuals planning to leave an inheritance or transfer wealth to their beneficiaries in a tax-advantaged manner. 

For Canadians protecting a short-term financial liability, term life insurance is usually the most cost-effective option since it provides a large amount of coverage when it is needed the most.

On the other hand, if you are a high net worth individual or you have maxed out your RRSPs or TFSAs, you can consider whole life insurance to leave behind an inheritance or cover final expenses and other costs.

Still confused about whether whole life insurance is right for you? Speak to our advisors and compare quotes from leading Canadian insurers to see what best fits your financial situation and needs.

The cost of whole life insurance typically ranges from $54 to $2,552 per month, depending on your age, health, coverage amount, premium payment option, and the insurer you choose. While whole life insurance costs more than term life insurance, the higher premiums provide benefits that last a lifetime, including permanent coverage, level premiums, and tax-advantaged cash value growth. Some policies, such as participating policies, may also earn annual dividends, depending on the insurer and policy type, further increasing their long-term value.

Quick summary of whole life insurance costs in Canada

Disclaimer: The illustrative monthly premiums below are based on the examples used throughout this guide. Your actual premium will vary based on your personal profile, coverage needs, and the insurer you choose.

Whole life insurance cost by applicant type in Canada

The cost of whole life insurance varies from one applicant to another because insurers assess each person’s level of risk before determining their premium. In general, younger applicants, women, and non-smokers tend to pay lower premiums, while older applicants and smokers typically pay more due to the higher likelihood of future insurance claims. The tables below show how whole life insurance premiums vary across common applicant types.

Cost of whole life insurance based on gender

The cost of whole life insurance for non-smokers typically ranges from $70.74 to $319.41 per month for males and $57.24 to $277.92 per month for females, depending on age. The cost of whole life insurance is generally lower for women, and they pay lower premiums than men. This is because females have a longer average life expectancy, resulting in a lower mortality risk for insurers over the lifetime of the policy.

Whole life insurance costs: Male vs female

*Illustrative monthly premiums for non-smoking males and females of various age ranges seeking a non-participating whole life insurance policy with $100,000 in coverage for a 20-pay premium option

Cost of whole life insurance based on smoking status

The cost of whole life insurance for smokers typically ranges from $84.60 to $413.34 per month, compared to $57.24 to $319.41 per month for non-smokers. Smokers pay higher premiums because tobacco and nicotine use increase the risk of serious health conditions and reduce life expectancy, increasing the likelihood of future claims.

Whole life insurance cost for a smoker vs. a non-smoker

*Illustrative monthly premiums for smoking and non-smoking males and females of various age ranges seeking a non-participating whole life insurance policy with $100,000 in coverage for a 20-pay premium option

Cost of whole life insurance for children

The cost of whole life insurance for children can start from $100 per month for a 20-pay participating whole life policy. Purchasing whole life insurance for a child at a young age allows parents or grandparents to lock in lower lifetime premiums while providing lifelong coverage and guaranteed cash value growth. Over time, eligible dividends may increase the policy’s cash value and death benefit, depending on the policy and dividend option selected.

Cost of life insurance for a male child

*Illustrative accumulated cash value and death benefit for a $100/month, 20-pay participating whole life insurance policy issued to a healthy 5-year-old boy. Projected cash values and death benefits assume current dividend scales and are not guaranteed; the actual policy values may vary

Cost of whole life insurance for seniors

The cost of whole life insurance for seniors typically ranges from $277.92 to $960.57 per month for seniors aged 60 to 80 with $100,000 in coverage under a 20-pay option. Premiums are generally higher for seniors because the likelihood of future insurance claims increases with age. Despite the higher cost, whole life insurance can help cover final expenses, leave a tax-efficient inheritance, and support estate-planning goals for seniors’ beneficiaries.

Whole life insurance costs for seniors

*Illustrative monthly premiums for non-smoking males and females of various age ranges seeking a whole life insurance policy with $100,000 in coverage for a 20-pay premium option

Whole life insurance costs by premium payment option

The cost of whole life insurance ranges between $38 and $323, depending on your age and the payment option you choose. Your premium payment option determines how long you will pay for your whole life insurance policy and how much you will pay each month. Shorter payment periods generally have higher monthly premiums because the policy is paid off sooner, while longer payment periods spread the cost over more years.

• 20 Pay: Pay premiums for 20 years, after which your policy remains fully paid up for life while your lifelong coverage and cash value continue to grow
• T65: Pay premiums until age 65, making it a popular option for those who want to complete payments before retirement while keeping lifelong coverage
• Life Pay: Pay premiums until age 100, resulting in the lowest monthly premiums by spreading the cost over the longest payment period

Whole life insurance cost by payment option

*Illustrative monthly premiums for a male non-smoker of various age ranges seeking a non-participating whole life insurance policy with $100,000 in coverage

Cost of whole life insurance by insurer in Canada

The cost of whole life insurance can vary noticeably between insurers, even for applicants with the same age, gender, coverage amount, and policy type. For example, a 20-year-old non-smoking male pays $70.74 per month with Foresters Life, compared to $113.49 per month with Canada Protection Plan for the same $100,000 of coverage. Differences in underwriting, pricing, and product design mean that the same applicant may receive different premiums from different insurers. Hence, comparing quotes from best whole life insurance companies helps you find the perfect combination of premium, policy features, and long-term value.

Whole life insurance cost by insurer

*Illustrative monthly premiums for non-smoking males and females of various age ranges seeking a non-participating whole life insurance policy with $100,000 in coverage for a 20-pay premium option

Is whole life insurance worth the cost?

Yes, whole life insurance can be worth the cost if you are looking for lifelong financial protection and long-term wealth-building benefits. Whole life insurance typically costs more than a comparable term life insurance policy, but the higher premiums provide lifelong financial benefits, including:

• Lifetime coverage that never expires as long as premiums are paid
• Guaranteed cash value growth that accumulates over time
• Level premiums that remain unchanged throughout the life of the policy
• Tax-advantaged cash value growth while the policy remains in force
• Support for estate planning and wealth transfer through a generally tax-free death benefit paid to beneficiaries
• Potential annual dividends on participating whole life policies, which may increase the policy’s cash value and death benefit over time

How does the cost of whole life insurance compare to term life insurance?

Whole life insurance generally costs more than term life insurance for the same coverage amount because it provides lifelong coverage and accumulates cash value over time. For example, a $100,000 whole life insurance policy costs approximately $57 to $382 per month, while a $100,000 term life insurance policy costs around $7 to $44 per month, making term life insurance the more affordable option for short-term coverage needs.

If you only need life insurance for a specific period, such as while paying off a mortgage or supporting your family, term life insurance may be the more cost-effective option. If you need lifelong coverage or want to build cash value over time, whole life insurance may be worth considering.

How to reduce the cost of whole life insurance

Although whole life insurance generally costs more than term life insurance, there are several ways to make coverage more affordable, such as buying early, choosing the right coverage amount, comparing quotes, and more. Here are some of the ways in which you can reduce the cost and get the cheapest whole life insurance:

• Buy coverage early: Purchasing whole life insurance at a younger age helps you lock in lower premiums for life
• Choose the right coverage amount: Choose a coverage amount that aligns with your financial needs without paying for more coverage than necessary
• Maintain a healthy lifestyle: Good overall health and remaining tobacco-free can help you qualify for lower premiums 
• Consider a non-participating policy: If dividend potential isn’t important to you, a non-participating policy can provide permanent coverage at a lower cost
• Select a longer premium payment period: Options such as Life Pay generally have lower monthly premiums than shorter payment schedules like 20 Pay because premium payments are spread over the entire policy period
• Compare quotes from multiple insurers: Premiums can vary significantly between insurance companies for the same coverage. Comparing quotes through PolicyAdvisor lets you evaluate plans from Canada’s leading insurers and find the best value based on your budget and financial goals. Schedule a call now to get instant whole life insurance quotes!

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.