Can You Have Too Much Term Life Insurance?

,

PolicyMe content follows strict guidelines for editorial accuracy and integrity. Learn more about our editorial guidelines.

Scroll down for full content ↓

Get a free instant term quote

Coverage for
Myself
Me & My Partner
Your Date of Birth
(DD/MM/YYYY)
Partner's Date of Birth
(DD/MM/YYYY)
Required field
Your Gender
Click to learn more about the author.
Different genders have different rates of developing illnesses, which is why insurers take it into account with pricing policies.We understand that you might not define your identity as simply "Male" or "Female" so we're working to add more options.We appreciate your flexibility.
Male
Female
Partner's Gender
Male
Female
Required field
Do you smoke?
Click to learn more about the author.
You should select “Yes” if you’ve used any nicotine products in the last 12 months. Nicotine products include:

Cigarette
E-Cigarettes
Pipes
Chewing tobacco
Vaporizers
Nicotine gum
Nicotine patches, or
13 or more cigars.

Otherwise, select “No”. Note: Cannabis products are NOT considered to be nicotine or tobacco products.
Yes
No
Does your partner smoke?
Yes
No
Required field
Required field
Get My Quote
No credit card or email required
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Get a free instant critical illness insurance quote

Coverage for
Myself
Me & My Partner
Your Date of Birth
(DD/MM/YYYY)
Partner's Date of Birth
(DD/MM/YYYY)
Required field
Your Gender
Click to learn more about the author.
Different genders have different rates of developing illnesses, which is why insurers take it into account with pricing policies.We understand that you might not define your identity as simply "Male" or "Female" so we're working to add more options.We appreciate your flexibility.
Male
Female
Partner's Gender
Male
Female
Required field
Do you smoke?
Click to learn more about the author.
You should select “Yes” if you’ve used any nicotine products in the last 12 months. Nicotine products include:

Cigarette
E-Cigarettes
Pipes
Chewing tobacco
Vaporizers
Nicotine gum
Nicotine patches, or
13 or more cigars.

Otherwise, select “No”. Note: Cannabis products are NOT considered to be nicotine or tobacco products.
Yes
No
Does your partner smoke?
Yes
No
Required field
Required field
Get My Quote
No credit card or email required
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Get a free instant permanent quote

Coverage for
Myself
Me & My Partner
Your Date of Birth
(DD/MM/YYYY)
Partner's Date of Birth
(DD/MM/YYYY)
Required field
Your Gender
Click to learn more about the author.
Different genders have different rates of developing illnesses, which is why insurers take it into account with pricing policies.We understand that you might not define your identity as simply "Male" or "Female" so we're working to add more options.We appreciate your flexibility.
Male
Female
Partner's Gender
Male
Female
Required field
Do you smoke?
Click to learn more about the author.
You should select “Yes” if you’ve used any nicotine products in the last 12 months. Nicotine products include:

Cigarette
E-Cigarettes
Pipes
Chewing tobacco
Vaporizers
Nicotine gum
Nicotine patches, or
13 or more cigars.

Otherwise, select “No”. Note: Cannabis products are NOT considered to be nicotine or tobacco products.
Yes
No
Does your partner smoke?
Yes
No
Required field
Required field
Get My Quote
No credit card or email required
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
In This Article

Can you have too much life insurance? “Overprotection" is a tricky topic. Let’s be honest—no family is going to complain about receiving too much money from an their life insurance company if their loved one dies. (When do people ever complain about getting too much money?) All things being equal, the lower the financial burden your family faces after you die, the better.

More protection = higher premiums

However, all things aren’t equal when it comes to life insurance. Insurance is a business, after all. If you want a bigger payout when you die, then you’ll have to pay higher premiums while you’re alive. And if you live past your retirement age, overprotecting will significantly affect the lifestyle your family can afford.

Read our post on how much term life insurance typically costs in Canada to learn more and get an online quote.

One thing we’ve noticed while building our life insurance recommendation engine is that lots of people are being told they should have more life insurance than they truly need. Why? Because life insurance is typically sold by asking leading questions, such as “Do you want to be able to pay for your children’s education if you die?" or “Do you want to make sure you have enough money to donate to charity if you die?" When most people get asked these questions, they think, “Of course, it would be great if my children’s education is taken care of."

If you plan to pay this cost with your savings or future income (and can afford it), great! Life insurance will ensure it’s paid for if you die.

But if you can’t afford the education costs in the first place, it doesn’t make sense to protect it with insurance coverage. Doing so would make you overprotected. It’ll create a financial windfall if you die young but add financial burden if you live to retirement.

Why? Because if you live to cut the cake at your retirement party, you’ll end up paying high life insurance premiums along the way to cover expenses you may not have paid for anyway. Thus, to get rates for life insurance that are still affordable, the earlier the you purchase, the better.

How much coverage should you get?

Before purchasing it, you should think about why you need life insurance. Consider how your family depends on you financially and how they would adjust if you died. We know these aren’t the types of thoughts that give you the warm fuzzies. But they’re important to think about if you want to protect your family efficiently and effectively.

The bottom line is that if you have people who depend on you financially, then any amount of coverage is worth it. If you have children, the most ideal coverage for you and your partner may be a joint term life insurance policy.

Learn more about what life insurance for seniors over 75 non medical life insurance is, term life insurance is in Canada, How much term life insurance you should buy, What term length do I choose, a critical illness insurance Canada quote and do I need life insurance if I'm single and childless? 

We protect you against buying too much life insurance

As a new company focused on giving customers quality, transparent, and customized life insurance advice, we help you understand your insurance needs and help you to avoid buying too much life insurance.

Our proprietary algorithm projects your income and lifestyle expenses to identify when you’re at risk of buying too much life insurance and to recommend coverage only for needs you’d be able to afford if you live into retirement.

Calculate life insurance needs prior to purchasing to ensure you don't have too much

PolicyMe Editorial Team

About the Author

What to read next