Best Senior Life Insurance in Canada in 2023

As we all grow older, most of us want to make sure that our loved ones have as much as we can give them, and will not be left with unexpected costs when we are gone.

There is a range of products available when searching for life insurance for seniors Canada, and it can be difficult to get to know what types of coverage might be the best for you.

We are here to help you make the right choice. Please enjoy this guide to senior life insurance Canada, from HelloSafe.

What is senior life insurance?

Senior life insurance products can cover a range of expenses and different changes to life circumstances that your family might face if you were to unexpectedly pass away. Companies offer coverage to adults of advanced age, including those who are living with health conditions. There are numerous plans available from a wide range of companies for over 50s life insurance in Canada, although the options vary depending on the provider. Some companies offer life insurance for seniors in their 80s, while others have a cutoff age of 70 or 75. Younger adults often buy insurance with a death benefit that will cover their lost income if they die suddenly. Still, policies from senior life insurance companies are only meant to cover certain final expenses. They typically come in smaller amounts than what people buy in their 30s and 40s and pay for costs like your funeral, medical bills, or even outstanding debts. Higher-end policies will provide the policyholder’s family with a guaranteed payout. Usually, the size of these policies will depend on how long the holder has paid into them. Later on, in this article, we will go into more detail about the different types of policies available for seniors in Canada.

How does senior life insurance work?

Life insurance for seniors is usually accessible to consumers after they reach the age of 50 and then is available up to a certain age, even without health checks in certain cases. Customers can take out life insurance for seniors over 70, and senior life insurance without a medical exam is available up to age 75 or even 85. A minority of Canadian insurers also offer such plans up to age 90.

If a customer has significant underlying health conditions, affordable senior life insurance will usually still be available, although just as with those of more advanced age, this will usually raise premiums beyond the basic rates available to younger or healthier prospective policyholders. Most often, insurers will require personal and lifestyle information to generate a quote for a policy, such as the gender of the prospective purchaser, or whether or not they smoke. These factors will also affect the price of the premium.

Senior plan life insurance coverage is specifically designed for people of advanced age. Whilst they might expire after a set period like other insurance policies, senior life insurance policies may also be selected that run for the rest of the policyholder’s life, as long as they keep paying the senior life insurance premiums. This means that their family, or any beneficiary they should choose, will get a guaranteed payout when the policyholder is no longer with them.

Many insurance providers have very simple web interfaces where consumers can input their circumstances and coverage requirements to generate a policy and price very quickly. Later on in this article, we will go into detail about some of the most popular providers offering life insurance for seniors in Canada.

What are the benefits of life insurance for seniors?

There are huge benefits to adding a life insurance policy to your long-term financial plan as a senior citizen in Canada. Below we have collated some of the major plus points to holding a senior life insurance policy.

To cover outstanding expenses

You can prevent your outstanding debts, such as a mortgage, rent, credit card bills, or unpaid loans from being passed on to family members and causing them additional stress whilst they cope with their loss.

To pay for end-of-life expenses

Senior final expense life insurance plans can help with unexpected costs that can prove to be a setback for your family after you are gone. Funeral costs can spiral upwards very quickly, and many seniors wish to protect their families or friends from the burden of these unexpected costs.

To help provide for loved ones

Even if your family is no longer reliant on your income, you can still help lessen their financial pressures. This could encompass paying for a grandchild’s tuition fees or covering some of the cost of a relative’s mortgage.

To contribute to a cause you care about

Some policyholders might opt for their payout to go to a cause or charity of their choice.

Purchasing senior life insurance Canada could mean that your loved ones or chosen beneficiary could receive a payout in the order of $500,000 in payouts for no medical policies or as much as $1 million on all other plans.

You could cover your and your family’s debts and expenses, and leave a legacy with a life insurance plan. The benefit paid out is tax-free.

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What types of life insurance exist for seniors?

There are a few main types of senior life insurance. In this section, we will shine a light on the main categories that policies tend to fall under, to help you to choose the perfect coverage for your later life needs.

Term or permanent senior life insurance?

Term senior life insurance is life insurance that lasts for a set period known as a term. The term can be a predetermined number of years or until you reach a certain age. The most common such products will cover a senior up to the age of 65. Term life insurance for seniors over 65 in Canada is also available, and there are policies available from a range of providers that will cover seniors up to the age of 90. The policyholder is expected to pay premiums to the life insurance provider until the expiry of the term, at which time the policy will need to be renewed, and the premiums are likely to go up.

In return, your beneficiaries are entitled to receive a tax-free death benefit if you die within the term of the policy. Once the term ends, your coverage also expires, and you can stop paying premiums.

Term life policies are usually offered for periods ranging from 10, 20, or 30 years to specific ages such as age 65, after which the coverage ceases. Some companies will also allow you to choose a term, in which case you can select your own life insurance coverage period to meet your needs. Term life insurance is most suitable for seniors under the age of 65 who would like to ensure that their closest relatives can pay short-term expenses, such as mortgage costs, should they die unexpectedly. Through a term policy, these expenses can be covered at a cheaper rate.

Permanent or guaranteed senior life insurance is a form of coverage that provides the policyholder with coverage from the day the policy is taken out until the day they pass away – for their entire life. As long as they pay premiums into the policy, the coverage never expires. Most of these policies can be taken out by people of any age, and are therefore a suitable option for consumers searching for life insurance for seniors over 65 in Canada.

This type of life insurance also combines this financial protection with investing. There is a cash value associated with most whole life coverage. As you pay into a whole life policy over time, part of the monthly premium is invested and generates cash value. This means that home improvement loans or equity releases can be carried out using the policy as collateral.

The policy’s cash value may be accessed during the policyholder’s lifetime either by withdrawing or borrowing against it. Since the coverage extends to their entire life and they retain the value they put into it, whole life insurance typically has significantly higher premiums than term coverage.

Universal life (UL) insurance is a form of permanent life insurance, lasting for the lifetime of the insured, that has an investment savings element and low premiums similar to those of term life insurance. Many UL policies contain a flexible premium option, which gives the holder further control over their rates and benefits. These policies can be borrowed against without tax implications, and they accumulate cash value over time.

Put simply, term policies are more affordable in the short term for younger policyholders, and are best suited for payouts to cover temporary needs, such as a mortgage, children’s education, or lifestyle protection. On the other hand, life policies are best suited for permanent needs such as estate planning, retirement income for your beneficiaries, and final expense (funeral) coverage. Term policies cannot be borrowed against, whereas life policies can be used as collateral. Permanent coverage could be a better investment as life insurance for seniors over 65, whereas term coverage could suit seniors between the ages of 55 and 65 that are looking to inexpensively protect their family from the unlikely event of their unexpected death.

Senior life insurance no medical exam is a range of products where the customer is not required to do a medical exam or doctor’s appointment when making an application for coverage. This is attractive to those that might be looking to avoid medical exams and to be protected quickly, but it’s also important to remember that the premiums for this type are most often significantly higher. However, these products can be underwritten extremely quickly often through simple online forms.

Why is senior life insurance important?

Senior life insurance is one of the best ways for older adults to make sure their families, loved ones, friends, or chosen charities and political causes are taken care of after they're gone. These plans can provide lucrative financial benefits to selected recipients upon the policyholder's death, providing funds necessary to pay for significant expenses such as medical bills, funeral costs and debts. In some cases, these policies may also provide the beneficiary with a lump sum, helping them to cover household expenses long after the policyholder has passed away.  It is important, however, that consumers find the best product for them, at a price which they can afford. In the next section, we go into more detail about how much senior life insurance policies of various types cost.

How much is senior life insurance?

The cost of senior citizen life insurance plans is generally significantly higher than those for younger adults as old age brings an increase in risks. Additionally, life insurance companies will look at other factors to determine the rate for a given customer’s policy, including their gender, health conditions, and lifestyle. For example, policies for male smokers will cost more than those for male non-smokers. Typically, men's policies are more expensive than women's due to lower life expectancy.

As an illustrative example, a 50-year-old male, free of health conditions, would pay about $330 annually for a 15-year term with $100,000 in coverage while a female with the same conditions would pay about $250 annually. On the other hand, a whole life insurance policy could cost five times as much.

Each life insurance company offers a different rate depending on each senior’s case so be sure to compare life insurance quotes with us to find an accurate cost for your individual needs.

What is the best life insurance for senior citizens?

The market for both senior term life insurance and senior whole life insurance is diverse, and there is a huge range of options available. There are some interesting newer contenders on the market, however. Ladderlife best life insurance for seniors was selected by Forbes as North America’s number one insurance product for older people in 2021.

Ladderlife affordable life insurance for seniors can be purchased in as little as 5 minutes, with a range of options available. This includes whole life insurance products, term and lifetime coverage. Ladderlife cheap life insurance for seniors is fully customizable, and policies can be changed after they have been purchased using the company’s innovative laddering system. This means Ladderlife life insurance senior policies can be adjusted to meet the needs of a consumer’s changing lifestyle and circumstances as they enjoy their later years. Of course, there is a range of other great providers out there, such as mutual of Omaha senior life insurance, TD insurance, and RBC insurance as well as many more.

If you want to find the right plan that suits your personal circumstances it can be very helpful to speak to a financial advisor.

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Alexandre Desoutter

Alexandre Desoutter has been working as editor-in-chief and head of press relations at HelloSafe since June 2020. A graduate of Sciences Po Grenoble, he worked as a journalist for several years in French media, and continues to collaborate as a as a contributor to several publications.