Compare Best Life Insurance in Canada For 2025: Reviews, Free Quotes
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- Fixed premiums for the term duration
- Option to renew the contract from the 5th year
- Fixed or decreasing insured capital
- Fixed premiums for the term duration
- Option to renew the contract from the 5th year
- Fixed or decreasing insured capital
Term Life Insurance by Beneva offers tailored flexibility to adapt to various coverage needs over 10, 15, 20, 25, 30, or 40 years, making it ideal for those looking to cover specific financial responsibilities such as personal loans or educational expenses for dependents. This policy is particularly advantageous for first-time buyers or those on a strict budget due to its affordable nature compared to permanent policies. It includes options to extend or modify the term, switch to permanent coverage without further health checks, and choose between decreasing or fixed capital to match changing financial obligations or provide a consistent benefit.
- Over 75 years of combined insurance expertise
- Affordable and flexible with multiple term options
- Premiums are constant during the initial term, aiding in financial planning.
- Ability to choose between decreasing or fixed insured capital.
- Can switch to a longer term within five years without a medical exam.
- Add-ons like critical illness coverage, disability waiver, children’s insurance, and more
- Premiums may rise upon renewal, although increases are known in advance.
- Decreasing Benefit Option is economical but reduces coverage over time, which may not suit everyone's long-term needs.
- Website doesn’t provide enough information about coverage
- Guaranteed premiums
- Option to convert the policy to permanent insurance at any time before age 75
- Ideal for business owners
- Guaranteed premiums
- Option to convert the policy to permanent insurance at any time before age 75
- Ideal for business owners
SunSpectrum Term Life Insurance from Sun Life offers flexible term lengths of 10, 15, 20, or 30 years, suitable for various temporary protection needs such as income replacement, debt protection, and future financial security for families or businesses. The product features guaranteed premiums and the option for guaranteed conversion to permanent insurance without health re-qualification before the policyholder's 75th birthday. This makes it ideal for individuals looking for affordability with the potential for lifelong coverage. It is especially beneficial for business owners concerned with succession planning and key employee protection.
- Guaranteed premiums and convertibility ensure cost predictability and easy transition to permanent coverage.
- High coverage limit with policies up to $15 million coverage, accommodating significant financial needs.
- Available in 10, 15, 20, and 30-year terms to match specific coverage durations.
- Includes living benefits for terminal illness and waivers during total disability.
- Tailored benefits for both personal and business needs, including child term and partner protection benefits.
- After the initial term, premiums increase significantly upon renewal.
- Conversion and longer term options are not available as age increases.
- Wide range of options may require careful consideration to ensure appropriate coverage.
- Cancel anytime without fees or penalties
- 30-day grace period for missed payments
- Beneficiaries get 100% of the payout, tax-free
- Cancel anytime without fees or penalties
- 30-day grace period for missed payments
- Beneficiaries get 100% of the payout, tax-free
PolicyMe Term Life Insurance offers an efficient and cost-effective solution for Canadians seeking reliable coverage. With options ranging from $100K to $5M and term lengths from 10 to 30 years, this policy is designed to be flexible and accessible. It provides locked-in rates for the entire term, ensuring cost predictability. The process to get covered is streamlined, making it hassle-free with immediate approval capabilities online. This policy is particularly suited for families looking for affordable protection without long-term commitments, and those who appreciate the ability to manage their insurance digitally.
- Affordable rates and up to 20% savings compared to traditional providers.
- Offers term lengths of 10, 20, 25, or 30 years to fit various life stages.
- Additional benefits include free child coverage and a couple’s discount in the first year.
- Quick online quote and application process with immediate approval.
- No fees or penalties for canceling the policy at any time.
- Primarily online interaction may not suit those preferring face-to-face service.
- Lacks the depth of coverage customization available with other insurers.
- Ideal solution for business owners
- Generating a quick return on investment
- Reduction in annual premium
- Enhancement of the liberated insurance
- Ideal solution for business owners
- Generating a quick return on investment
- Reduction in annual premium
- Enhancement of the liberated insurance
Guaranteed Acceptance Life Insurance from Canada Protection Plan offers a robust solution for individuals who face significant challenges obtaining traditional life insurance due to health issues, high-risk occupations, or past substance use. This whole life participating insurance is tailored to cover final expenses and provide peace of mind without requiring medical exams. It is most suitable for those who have been previously declined insurance or who have serious pre-existing conditions.
- Guaranteed acceptance without medical exams.
- Fixed premiums and built-in benefits like Terminal Illness and Transportation.
- Policy accumulates cash values after five years.
- Limited maximum coverage of $50,000.
- Restricted death benefits in the first two years.
- Higher premium costs than standard policies.
- Fixed or decreasing insurance amount
- Fixed premiums and guarantees
- Option to convert to permanent life insurance without medical evidence
- Fixed or decreasing insurance amount
- Fixed premiums and guarantees
- Option to convert to permanent life insurance without medical evidence
Pick-A-Term by iA is a term life insurance solution designed with affordability and flexibility in mind, suitable for various stages of life including young families and pre-retirees. It offers terms from 10 to 40 years, which can align with significant financial commitments like mortgages or educational expenses. The fixed and guaranteed premium structure simplifies budgeting, while options to renew annually or convert to permanent insurance provide adaptability as needs evolve. This product is ideal for those seeking financial security without the long-term commitment of permanent life insurance, accommodating both personal and business insurance needs.
- Versatile term options from 10 to 40 years, matching key financial periods.
- Premium rates are guaranteed and known upfront, aiding in financial planning.
- Allows conversion to permanent coverage at any time without health checks.
- Can be renewed annually to adapt to changing insurance needs.
- Available with additional benefits such as critical illness and disability insurance.
- At renewal, premiums may increase based on the new term.
- Decreasing Benefits Option is not suitable for those needing consistent coverage amounts throughout the term.
- Numerous coverage and benefit options could complicate decision-making.
According to the Canadian Life and Health Insurance Association, approximately 22 million Canadians currently hold a life insurance plan, with the average household covering up to $442,000. This adds up to an impressive total coverage of $5.1 trillion, underscoring how essential life insurance is to financial planning.
But how do you choose the best life insurance in Canada? This guide will walk you through everything you need to know—what is life insurance? What does it cost? What are the types? How much life insurance do you need? Is it worth it?
You can use our free comparator to compare Canada's best life insurance policies and get free personalized quotes, all in the same place. Get the best rates and save with our tool.
Life Insurance Canada: 10 Key Points
- Life insurance provides a tax-free payout to support your family’s needs if you’re no longer around.
- It can be purchased:
- For a specific period: Term life insurance.
- For a lifetime: Permanent (or whole) life insurance.
- Permanent life insurance builds cash value you can use for loans, withdrawals, or premiums.
- Premiums are lower when you apply at a younger age, locking in savings over time.
- Many policies come with tax benefits, including tax-free death benefits for beneficiaries.
- Many insurers offer no-medical exam policies, making it easier and faster to get coverage.
- Add riders like critical illness or disability coverage to tailor your coverage.
- Protect your family from debts, mortgages, and unexpected costs while securing their future.
- It can also be a valuable tool for estate planning and leaving a financial legacy.
- Compare quotes from Canada's best life insurance companies for the best rates.
What is the best life insurance in Canada in 2025?
With over 150 life insurance providers in Canada, finding the right one can feel overwhelming. That’s why we analyzed the market and created a list of the top 18 best life insurance companies to make your choice easier.
We focus on what matters most to you—affordability, customer reviews, policy flexibility, no-medical exam options, convertibility, and value-added benefits—ensuring our recommendations are tailored to your needs. So here are the best life insurance Canada plans and their key features in the table below.
| Best Life Insurance Canada | Key Features | Get a free quote |
|---|---|---|
 Beneva |
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 RBC Life Insurance |
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 Manulife Life Insurance |
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 Assumption Life Insurance |
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 Equitable Life Insurance |
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 Foresters Life Insurance |
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 Humania Life Insurance |
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 Canada Life Insurance |
Participating Whole Life Insurance
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 BMO Life Insurance |
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 Canada Protection Plan Life Insurance |
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 Empire Life Insurance |
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 Sun Life Life Insurance |
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 iA Life Insurance |
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 Ivari Life Insurance |
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 UV Insurance Life Insurance |
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 Desjardins Life Insurance |
| Consult Desjardin's Website |
 Wawanesa Life Insurance |
| Consult Wawanesa's Website |
 TD Life Insurance |
| Consult TD Insurance Website |
Good to know
We suggest comparing these insurance plans before making your final decision. You can use our comparison tool at the top of the page to compare multiple policies and acquire free life insurance quotes within seconds.
What is life insurance?
Life insurance is a financial safety net designed to support your loved ones in the event of your passing. It ensures that your beneficiaries receive a tax-free payout to help them manage expenses, debts, or other financial challenges during difficult times.
You can choose between term life insurance, which provides coverage for a specific period, or permanent life insurance, which offers lifelong protection. Beyond peace of mind, some policies also act as a savings or investment tool, allowing you to build wealth over time while safeguarding your family’s future.
How does life insurance work?
Imagine Sarah, a 35-year-old mom from Toronto. She purchases a life insurance policy with a $500,000 benefit. If something unexpected happens to Sarah, her family won’t need to worry about paying the mortgage or her kids’ college tuition. The policy gives Sarah peace of mind knowing her family’s financial future is secure.
Life insurance is about protecting what matters most—your family’s stability and well-being.
Key Benefits
- Provides financial security: Ensures your family has the financial support they need for daily expenses, education, and other needs after your passing.
- Tax-free payouts: Beneficiaries receive the death benefit without having to pay taxes, maximizing the amount they receive.
- Covers major expenses: Can help pay off mortgages, outstanding debts, or funeral costs, relieving your family of financial stress.
- Builds cash value (for permanent policies): Some policies accumulate cash value over time, which you can use for loans, withdrawals, or even paying premiums.
- Customizable coverage: Riders like critical illness or disability benefits allow you to tailor the policy to your unique needs.
Drawbacks
- Policy management fees: Some policies include administrative or investment management fees that reduce returns on cash value.
- Slow cash value growth: The savings component in permanent life policies may take years to accumulate significant value.
- Investment risks: Depending on the chosen investment profile, the policy’s cash value may be affected by market fluctuations, potentially leading to capital loss.
How much life insurance should you get?
The amount of life insurance you need depends on your financial situation and goals. A good rule of thumb is to aim for coverage that is 5 to 10 times your annual income. Consider these factors:
- Outstanding debts: Include your mortgage, car loans, or credit card balances.
- Income replacement: Multiply your annual income by the number of years your family would need financial support.
- Future expenses: Plan for your children’s education, weddings, or major family milestones.
- Final expenses: Account for funeral and burial costs, typically $10,000–$20,000 in Canada.
How much life insurance do I need?
Your Life Insurance Coverage = Debts + Income Replacement + Future Expenses - Savings
For example, if you have a $300,000 mortgage, want to replace $50,000 of annual income for 10 years ($500,000), and plan for $20,000 in final expenses, your total need is $820,000. Subtract any savings or existing coverage, and that’s your ideal life coverage amount. This ensures your family can pay off debts, maintain their lifestyle, and cover future costs.
When should you get life insurance?
Life insurance is always a good idea, but there are specific situations where it becomes especially important:
- Buying a Home or Taking on Debt: A new mortgage or significant loan can place financial strain on your family if something happens to you. Life insurance ensures your loved ones aren’t left to shoulder this burden.
- Getting Married or Starting a Family: Marriage and parenthood bring new responsibilities. Life insurance provides financial protection for your partner and children, covering living expenses, education costs, and more.
- Caring for Dependents: If you support elderly parents, a partner, or children, life insurance coverage guarantees they can maintain their quality of living and meet essential needs in your absence.
- Owning a Business: Entrepreneurs and shareholders should consider life coverage to fund buy-sell agreements, protect the business, and compensate beneficiaries without disrupting operations.
- Planning for Taxes or Legacy: Permanent life coverage can help cover estate taxes or ensure your loved ones receive a meaningful inheritance, preserving wealth across generations.
- Preparing for the Unexpected: Even if you’re young and healthy, life insurance is cheaper when you’re younger. Acting early locks in lower premiums and protects against future insurability issues.
- Major Life Milestones: Events like retirement planning, career changes, or sending kids to college are good times to evaluate your financial obligations and consider life insurance as a safety net.
Expert advice
The earlier you secure life insurance, the better your options and rates. Premiums are based on your age and health—starting young means lower costs and more time to build value if you choose permanent coverage.
It’s also important to note that many insurers have age limits for new policies—typically around 55 for some companies and up to 85 for others. Securing coverage early ensures you won’t miss out on the protection you need.
How much does life insurance cost in Canada?
Life insurance in Canada can cost from as low as $12/month to several hundred dollars. For instance, a 30-year-old non-smoker can expect to pay around $15–$25 per month for a 10-year term life insurance policy with $250,000 in coverage.
In contrast, a 40-year-old non-smoker might pay $35–$45 per month for the same policy. Permanent life insurance, while more expensive, provides lifelong coverage and builds cash value, with premiums typically starting at $150 per month or more for similar coverage amounts.
The cost of life insurance in Canada varies based on several factors, including:
- Age of the Policyholder: Younger individuals pay lower premiums.
- Chosen Beneficiaries: Who will receive the payout matters.
- Health Status: Smokers and those with medical conditions often pay more.
- Type of Policy: Costs differ between term and permanent insurance.
Expert advice
On average, life insurance premiums range from $500 to $1,000 annually, but prices can vary significantly depending on the policy and provider. Paying your premiums annually is often more cost-effective than paying monthly.
Life insurance quotes for 2025
Here’s a table illustrating the average monthly costs of life insurance in Canada for different types of policies and profiles:
| Age & Profile | 10-Year Term Life ($250,000) | 20-Year Term Life ($250,000) | Permanent Life ($250,000) |
|---|---|---|---|
| 30-Year-Old Non-Smoker | $15–$25 | $25–$40 | $150–$200 |
| 30-Year-Old Smoker | $30–$50 | $50–$75 | $200–$300 |
| 40-Year-Old Non-Smoker | $35–$45 | $55–$70 | $200–$300 |
| 40-Year-Old Smoker | $60–$80 | $100–$150 | $300–$450 |
| 50-Year-Old Non-Smoker | $70–$90 | $120–$150 | $400–$600 |
| 50-Year-Old Smoker | $120–$150 | $200–$300 | $600–$900 |
Example of how life insurance cost is calculated
Vince, at the age of 30, decided to purchase a 20-year term life policy in Alberta. This policy ensures coverage until he reaches the age of 50, and his annual premium is approximately $150.
On the other hand, Garth, also residing in Alberta, didn't get life insurance during his 30s, and fortunately, he remained healthy during that time. When Garth turns 40, he decides to buy a 10-year term life policy. Now, both Vince and Garth are insured from 40 to 50.
Here's the key difference:
- Vince bought his policy at age 30, and therefore his premium is set at $150 per year for the entire twenty-year term, resulting in a total cost of $150 x 20 = $3,000 for the coverage.
- Garth, on the other hand, delayed buying insurance until he was 40. Consequently, his premium for the 10-year term is slightly higher, around $185 per year. Therefore, Garth will pay $185 x 10 = $1,850 for the same coverage and policy, even though he and Vince have identical lifestyles and are insured during the same age range.
Good to know
The timing of buying life insurance greatly affects costs. Purchasing at a younger age often means lower premiums as insurers see younger individuals as lower risk. Waiting can result in higher premiums.
What does life insurance cover?
| What does Canada life insurance cover? | What does Canada life insurance not cover? |
|---|---|
|
Death benefit payout provides a tax-free lump sum to beneficiaries for various purposes like covering debts and ensuring financial stability. Debt settlement to assist in clearing outstanding financial obligations, preventing their transfer to surviving family members. Income replacement to help substitute lost income for dependents, is especially crucial for families relying on the policyholder's income. Funeral costs, easing financial burdens during difficult times. Liquidity for smooth asset distribution and potentially reduces heirs' tax burden. |
Suicide during the contestability period may limit claims. Providing false information or engaging in fraud during policy application, such as concealing health conditions, can lead to claim denial. Deaths occurring during criminal acts are typically not covered. Engaging in high-risk activities like extreme sports (e.g., skydiving or heli-skiing) might result in exclusions. Some policies may exclude coverage for deaths in specific high-risk regions. Failing to pay premiums may lead to a policy lapse and loss of coverage. |
Does life insurance cover natural death?
Yes, life insurance almost always covers natural death and accidents. In the event of illness, heart attack, stroke, old age, or similar events, your estate or beneficiaries will receive the death benefit. Generally, motor vehicle accidents, drownings, and similar events will qualify too.
Deaths that would not be eligible for life insurance payouts are murder by the beneficiary or deaths stemming from risky activities (auto racing, rock climbing, scuba diving, hang gliding, etc). In the event of suicide, it is unlikely to qualify if it occurs during the contestability period shortly after you purchase the policy.
Does life insurance cover suicide?
In Canada, life insurance policies typically do not cover suicide during the contestability period, which is usually the first two years after the policy is purchased. If the policyholder dies by suicide during this time, the insurer is not obligated to pay out the death benefit.
However, if the suicide occurs after the contestability period and the premiums have been paid, most life insurance policies will provide the full death benefit to the beneficiaries. Here are the key points:
- Contestability Period: Typically lasts for two years; suicide is excluded during this time.
- After the Period: Policies generally cover suicide if it occurs after the contestability period and premiums are current.
- Policy Terms: Always check specific policy exclusions, as terms can vary between insurers.
This rule helps prevent cases of insurance fraud while still offering long-term financial protection for beneficiaries.
What are the different types of life insurance policies in Canada?
Permanent Life Insurance
Permanent life insurance provides lifelong coverage as long as you pay the premiums. It guarantees a tax-free death benefit for your beneficiaries and typically includes a cash value component that grows over time. This type of insurance is ideal for estate planning, building wealth, or leaving an inheritance. Here are the key features of permanent life insurance policies in Canada.
- Lifelong Coverage: Remains active as long as premiums are paid.
- Fixed Premiums: Premiums typically remain constant throughout the policy's life.
- Cash Value: Accumulates over time, tax-deferred, and can be accessed via loans or withdrawals.
- Estate Planning: Helps cover estate taxes and provides an inheritance.
- Dividend Options: Some policies offer dividends that can be reinvested or taken as cash.
- Higher Cost: Generally more expensive than term life insurance.
- Flexible Payout: Allows beneficiaries to use the death benefit for any purpose.
Term Life Insurance
Term life insurance provides coverage for a specific period, such as 10, 20, or 30 years. If the policyholder passes away during this term, their beneficiaries receive a tax-free death benefit. This type of insurance is an affordable option for temporary needs like mortgages or raising children. Here are the key features of term life insurance in Canada.
- Affordable Premiums: Lower initial cost compared to permanent life coverage.
- Fixed Term: Coverage is available for predefined periods, e.g., 10, 20, or 30 years.
- No Cash Value: Does not build savings or investment components.
- Renewable Options: Policies can often be renewed, though premiums increase.
- Convertible: Many policies allow you to convert to permanent insurance without a medical exam.
- Tax-Free Payout: Beneficiaries receive a lump sum free of taxes.
- Flexible Coverage Amounts: Choose based on your specific needs, like mortgage protection or income replacement.
Canada Term Life Insurance vs. Permanent Life Insurance
| Feature | Term Life Insurance | Permanent Life Insurance |
|---|---|---|
| Coverage Duration | Fixed term (e.g., 10, 20, 30 years) | Lifelong, as long as premiums are paid |
| Premiums | Lower initial cost | Higher but fixed for life |
| Cash Value | ||
| Renewability | Renewable with higher premiums | Not applicable (coverage is permanent) |
| Purpose | Temporary needs (mortgage, children) | Estate planning, lifelong security |
| Cost Over Time | Increases upon renewal | Stable in the long run |
| Best For | Short-term financial obligations | Long-term wealth-building and legacy |
Whole Life Insurance
Whole life insurance is one of the most common types of permanent life insurance that provides lifelong coverage and guarantees a death benefit for beneficiaries. It also includes a savings component (cash value) that grows over time on a tax-deferred basis, making it both a protection and investment tool. Here are the key features of Whole Life Insurance Canada:
- Lifelong Coverage: Ensures financial protection for your family as long as premiums are paid.
- Guaranteed Death Benefit: Beneficiaries receive a predetermined amount tax-free upon your passing.
- Cash Value Growth: Builds savings over time, accessible for loans or withdrawals.
- Fixed Premiums: Offers predictability by keeping premiums consistent throughout the policy term.
- Dividend Options: Some policies provide dividends, which can be reinvested, reduce premiums, or taken as cash.
- Tax Advantages: Cash value grows tax-deferred, and the payout is tax-free for beneficiaries.
- Best for Estate Planning: Ideal for those wanting to leave a financial legacy or cover estate taxes.
- Higher Costs: More expensive than term life coverage due to lifelong coverage and cash value features.
For example
Imagine Lisa, a 40-year-old mother in Toronto. She purchases a whole life policy with $500,000 coverage. Over 20 years, her policy builds a cash value of $100,000, which she can use for her retirement or emergencies while still maintaining the full $500,000 death benefit for her family.
Universal Life Insurance
Universal life insurance is a type of permanent coverage that combines lifelong coverage with a flexible savings component. Policyholders can adjust premiums and death benefits while investing the cash value in various financial instruments. Here are the key features of universal life insurance in Canada.
- Flexibility: Adjust premiums and coverage amounts based on your needs.
- Investment Options: Cash value can be invested for potential growth.
- Tax-Deferred Growth: Investment earnings grow without immediate taxation.
- Cash Withdrawals/Loans: Access the cash value for emergencies or planned expenses.
- Lifelong Coverage: Provides permanent protection.
- Higher Complexity: Requires careful management of investments and premiums.
- Higher Cost: Generally more expensive than term life coverage.
Mortgage Life Insurance
Mortgage life insurance is designed specifically to pay off your mortgage in the event of your death. Unlike traditional life coverage, the benefit goes directly to the lender, ensuring your family isn’t burdened with housing debt. Here are the key features of mortgage life insurance in Canada.
- Direct Mortgage Payment: Pays the outstanding mortgage balance directly to the lender.
- Declining Coverage: Payout reduces as the mortgage balance decreases.
- Simple Application: Often requires minimal underwriting.
- Tied to the Mortgage: Coverage ends when the mortgage is paid off.
- Not Portable: Can’t be transferred if you switch lenders.
- Fixed Premiums: Payments stay the same even as coverage decreases.
- Limited Beneficiary Control: The lender, not your family, receives the benefit.
Group Life Insurance
Often provided by employers as part of employee benefits, group life insurance offers basic coverage at a low or no cost to employees.
- Low Cost: Employers often subsidize or fully cover premiums.
- Limited Coverage: May not be sufficient for individual needs.
- No Portability: Coverage ends if you leave the job.
- Easy Enrollment: No medical exam required.
Critical Illness Insurance
Critical illness insurance provides a lump sum if you’re diagnosed with a covered critical illness like cancer or a heart attack. Here are the key features:
- Financial Support: Covers medical expenses or lost income during recovery.
- Standalone or Rider: Can be purchased separately or added to life coverage.
- Tax-Free Payout: The benefit is typically tax-free.
How to get life insurance quotes in Canada?
Getting a life insurance quote is simple. Shop around for quotes from top life insurance companies in Canada by using our comparator tool at the top of this guide. In just a few moments, you'll receive personalized quotes tailored to your needs. When applying for life insurance quotes, you'll need to make key decisions, such as:
- Type of Coverage: Decide whether you need term life (temporary coverage for a specific period) or permanent life coverage (lifetime protection).
- Number of Insured Individuals: Are you looking to cover yourself, your family, or even your children?
- Payout Amount: Determine the sum your beneficiaries will receive upon your passing. This can make a significant difference in their financial security.
- Beneficiaries: Choose who will receive the payout and what percentage each should get.
For more tailored guidance, consider working with a life insurance broker. These professionals specialize in matching policies to individual needs and can help you navigate the complexities of life insurance to ensure you get the best value for your money.
Expert advice
Some insurers may require you to undergo a medical exam before approval, while others may not. For example, group insurance policies often guarantee coverage without the need for a medical exam. By comparing your options and understanding your needs, you can find the perfect life insurance policy to protect your loved ones.
How to choose the best life insurance policy in Canada?
1. Assess your financial situation
Before determining the type and amount of coverage you need, evaluate your financial health. Consider existing financial support mechanisms for your dependents, like emergency funds, retirement savings, and any life insurance from your workplace. Consulting a financial planner can help identify specific needs, such as mortgage payments, supporting children, maintaining a business, or leaving a legacy.
2. Know your coverage needs
People often underestimate the amount of life insurance they need. While focusing on paying off major debts like mortgages is common, it's crucial to consider the broader financial needs of your family. Using a life insurance calculator is a great starting point. Collaborating with a financial planner can help determine a more accurate coverage amount based on your circumstances and goals.
3. Choose the right policy type
Understand the difference between term and permanent (or whole) life insurance. Term life offers coverage for a set period, while permanent life insurance provides lifelong coverage at a higher cost. Deciding on the type of policy depends on your specific needs and financial objectives.
4. Understand factors affecting life insurance Canada rates
Life insurance rates are influenced by a variety of factors:
- Death Benefit Amount: Higher coverage results in higher premiums.
- Type of Life Insurance Policy: Term policies are generally cheaper than whole-life policies. Longer terms are generally more expensive, whereas shorter terms are usually more cost-effective.
- Age: Older individuals typically pay more as they have a shorter life expectancy.
- Gender: Females, with a longer life expectancy, may pay less.
- Health: Good health usually leads to lower premiums; certain conditions may increase costs.
- Tobacco Use: Smoking often results in higher premiums/costs.
- Family History: A family history of health issues may raise premiums.
- Lifestyle & Occupation: Risky activities or jobs may increase the cost of life insurance.
Term length significantly affects cost, with longer terms generally associated with higher costs. Younger individuals tend to get lower rates due to being perceived as healthier and less risky to insure. Term life policies often offer the option to convert to permanent insurance later, allowing you to secure a lower rate initially.
5. Compare insurance companies for the best rates
Take advantage of free online quotes offered by various insurers to compare rates. Rates can differ significantly between companies. Working with an independent insurance agent who deals with multiple insurers can also assist in finding the most suitable coverage at a competitive price. You could use a tool like our free HelloSafe comparator at the top of this page that lets you compare quotes from multiple providers at the same time.
Can you get life insurance without a medical exam in Canada?
Yes, you can get life insurance in Canada without undergoing a medical exam. This option, known as no-medical exam life insurance, is ideal for people who want fast, hassle-free coverage or have pre-existing medical conditions that might make traditional policies harder to obtain. Instead of a full medical check-up, you’ll typically answer a short health questionnaire.
However, these policies tend to have higher premiums and lower coverage limits than standard life insurance due to the increased risk taken by insurers.
Key points on no exam life insurance in Canada:
- Fast Approval: Skip lengthy underwriting processes; coverage can be issued within days.
- Higher Premiums: The absence of a medical exam increases costs due to insurer risk.
- Lower Coverage Limits: Typically, coverage maxes out at $500,000, though some providers may offer more.
- Tailored for High-Risk Applicants: Ideal for individuals with health issues or those who dislike medical procedures.
Expert advice
If you’re considering no-medical life policies, carefully compare premiums and coverage options. Some insurers offer “simplified issue” policies with limited health questions, while others provide “guaranteed issue” policies that require no questions at all. Simplified issue policies are generally more affordable. Consult an insurance advisor to determine the best option for your circumstances.
Life Insurance for Seniors: How does it work?
Providers often offer tailored senior life insurance solutions to meet the unique needs of older individuals. With coverage typically available up to age 85 or even beyond, these policies are designed to provide peace of mind by covering final expenses, debts, or leaving a legacy. While health and age affect premiums, many options don’t require a medical exam, focusing instead on short health questionnaires for faster approval. Whether you're seeking short-term protection or lifelong security, there’s an option to suit your needs.
What coverage options are available for seniors?
- Term Life Insurance: Provides coverage for a fixed term, such as 10 or 20 years. Ideal for seniors in their 60s or early 70s needing coverage for debts or income replacement.
- Whole Life Insurance: Offers lifetime protection and builds cash value over time. Suitable for estate planning, inheritance, or covering estate taxes.
- Simplified Issue Life Insurance: Requires only a short health questionnaire, making it accessible for seniors with minor health conditions. Coverage is often smaller, focusing on final expenses.
- Guaranteed Issue Life Insurance: No medical questions or exams required. Designed for seniors with significant health concerns, this policy is easy to qualify for but comes with higher premiums and lower payouts.
- Final Expense Insurance or Funeral Insurance: Specifically for covering funeral and end-of-life costs, this option offers smaller coverage amounts and is ideal for seniors over 75 or 80.
- Term-to-100 Policies: Provides lifelong coverage without the cash value component of whole life policies. Premiums are fixed but slightly higher than term policies.
Key things to know about senior life insurance
- Seniors can secure policies even at advanced ages, though premiums increase with age.
- Final expense insurance is typically capped at $50,000, focusing on funeral costs and minor debts.
- Locking in a policy in your early 60s can lead to better rates compared to waiting until your late 70s or 80s.
- Comparing quotes using our tool from multiple insurers ensures you find the best coverage for your budget.
Good to know
Our guide on senior life insurance explores everything you need to know about options for seniors over 50, 60, 70, and 80 in Canada from costs, and plans, and also get free personalized quotes.
Can you buy life insurance for your children?
Yes, life insurance for children is an affordable way to secure their financial future. Parents or grandparents can purchase these policies to lock in low premiums and provide lifelong protection. Many of these policies accumulate cash value over time, which the child can access later for expenses like education, home buying, or starting a business. It also ensures that the child remains insurable, even if they develop a medical condition in the future.
For example
Sarah, a new mother in Ontario, buys a whole life policy for her newborn with a $50,000 coverage amount at $15/month. By the time her child is 25, the policy has built significant cash value that can be used for university tuition or other needs.
Key benefits of life insurance for children:
- Locks in affordable premiums for life.
- Builds tax-deferred cash value over time.
- Protects the child’s insurability for future coverage.
- Provides financial security for unforeseen events.
- Can be gifted to the child as an adult for financial flexibility.
Expert advice
Children's life insurance isn't just about payouts in the rare case of tragedy. It's a long-term financial tool. Look for policies that offer guaranteed insurability riders, allowing your child to increase coverage later in life without a medical exam, regardless of their health status.
Is life insurance taxable in Canada?
Life insurance payouts in Canada are generally not taxable. Beneficiaries receive the death benefit as a tax-free lump sum, making it an efficient way to provide financial support to your loved ones. However, tax implications may arise if you withdraw from the cash value of a permanent policy or use it as collateral for a loan. Here are things to remember about taxes:
- Death benefits are tax-free.
- Borrowing or withdrawing from cash value may have tax implications.
- Life insurance is an excellent tool for estate planning, helping beneficiaries avoid probate taxes.
For example
If you leave a $500,000 policy to your spouse, they will receive the full amount tax-free. However, if you borrow $50,000 from the policy’s cash value during your lifetime, taxes may apply to the portion of the withdrawal that exceeds your paid premiums.
Who can be beneficiaries of a life insurance policy?
In Canada, you can designate anyone as a beneficiary, including family members, friends, charities, or your estate. Beneficiaries can be classified as revocable, which allows you to change them anytime, or irrevocable, which requires their consent for changes. Naming a beneficiary ensures that your payout avoids the probate process, providing quicker access to funds.
Key options for Canada life insurance beneficiaries:
- Revocable Beneficiaries: You can modify them without consent.
- Irrevocable Beneficiaries: Require their agreement to make changes.
- Charitable Beneficiaries: Leave a legacy by donating the payout to a cause you care about.
- No Named Beneficiary: If no one is specified, the payout goes into your estate and may face probate delays.
Expert advice
Regularly review your beneficiary designations, especially after major life events like marriage, divorce, or the birth of a child. Failing to update beneficiaries could result in payouts to unintended recipients.
What happens to unclaimed life insurance?
Unclaimed life insurance occurs when beneficiaries are unaware of a policy or cannot be located. In Canada, insurers are obligated to make efforts to locate beneficiaries, but if no claims are made within three years, the funds are held. Beneficiaries can still claim these funds within specific timeframes, depending on the amount and provincial regulations.
Important things you should know about claims:
- Beneficiaries can claim amounts up to 30 years after death.
- Common issues include outdated contact information or unreported deaths.
- Unclaimed funds are eventually absorbed by the insurer or the government, depending on provincial laws.
FAQs About Life Insurance
Absolutely. Life insurance provides financial protection for your loved ones, ensuring they’re not burdened with debts, mortgage payments, or final expenses if something happens to you. It’s also an affordable way to create long-term security and can offer additional benefits like cash value growth with permanent policies.
The cost varies depending on factors like age, health, and the type of policy. For example, a 30-year-old non-smoker could pay as little as $15–$25/month for term insurance, while permanent policies start at around $140/month. Use online tools to get personalized quotes.
Life insurance beneficiaries receive a tax-free, one-time payment in Canada. Neither term nor whole life policies require declaration on tax returns. Naming and updating beneficiaries is crucial to avoid complexities. Without named beneficiaries, the benefit may go to the estate, possibly facing taxes and debts before distribution.
Life insurance direct allows you to buy a policy directly from an insurer, often online, without involving brokers or intermediaries. It simplifies the process, offering ease, speed, and transparency. Policies are often more affordable since you avoid broker commissions. You can compare quotes, customize coverage, and complete applications online, often with instant approvals.
Yes, getting life insurance coverage in your 30s is a smart financial move. Premiums are lower when you’re younger and healthier, locking in affordable rates for years to come. It ensures financial protection for your loved ones, whether you’re starting a family, buying a home, or planning long-term security.
If you have dependents, debts, or financial responsibilities, life insurance is essential. It protects your family by replacing lost income, covering outstanding debts, and helping them maintain their lifestyle. Even if you’re single, life insurance can be useful for covering final expenses or leaving a legacy.
Calculate your needs by adding your debts (e.g., mortgage, loans), income replacement (e.g., salary for 10–20 years), and future expenses (e.g., education, funeral costs). Subtract savings or existing resources to find the coverage amount. Online calculators can simplify this process for you.
Typically, if the policy was active and in good standing when the policyholder passed, the filing deadline can vary from 90 days to 12 months, as per the Canadian Life and Health Insurance Association.
You can borrow against a permanent life policy once it has enough cash value, typically after 2–3 years of premium payments. Most insurers allow borrowing 70–90% of the cash value, but unpaid loans and interest will reduce the death benefit. Check with your provider for exact terms.
Yes, you can have multiple life insurance policies. Many people combine term and permanent policies to meet different financial needs, like covering debts and providing lifelong protection. Just ensure the combined coverage aligns with your financial goals and is affordable within your budget.
All our guides on life insurance in Canada:
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- Life insurance broker Canada: 2025 guide
- What is joint life insurance? 2025 Canada guide
- How much does life insurance cost in Canada in 2025?
- What are the benefits of life insurance in 2025?
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- Best Permanent Life Insurance Canada 2025 (Updated)
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- Is Life Insurance taxable in Canada? Explained with examples
- Best life insurance for children in Canada in 2025
- Best Life Insurance for Seniors in Canada: 2025 Updated
- Best Universal Life Insurance Canada: Updated 2025 guide
- Is Life Insurance worth it in Canada? Explained with examples
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- What is a life insurance beneficiary? 2025 guide
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- Best Whole Life Insurance in Canada 2025 (Updated)
- Best term life insurance in Canada in 2025: Free quotes
