Term Life Insurance Quotes: What Impacts Your Rate?

How much does term life insurance cost? 

The average starting term life insurance quote is around $23.80 for a 35-year-old non-smoking woman, for $500,000 over 20 years.*  But take note, the cost of term life insurance will vary depending on a few different criteria, namely: 

• Your gender
• Your age
• Your risk status
• Policy type (coverage amount & length)

For many of these sample rates, we’ve used a $500,000 coverage amount for 20 years, as it is the most commonly purchased term life insurance amount.

Term life insurance quotes by company

To give you a general idea of how quotes can vary, we’ve pulled term life insurance rates from a few major Canadian life insurance companies. These are starting rates for a 35-year-old non-smoker with $500,000 in coverage over a 20-year term.

Term life insurance quotes by term length

Term length is a key factor in determining your life insurance quote. The shorter the term you choose, the cheaper the quote will be. It’s generally a good idea to choose a term length that matches the duration of your financial responsibilities. For example, if you have 10 years left on your mortgage, a 10 year term may be a good idea. 

Here are starting term life insurance quotes by term length, pulled from PolicyMe rates for a 35-year-old non-smoking applicant for $500,000 in coverage.

Term life insurance quotes by coverage amount

Another key factor in determining your insurance needs is the amount of coverage you’ll require. Term life insurance is designed to provide your loved ones with financial protection for a set period — so the next question to consider is: “What should this policy cover?”

Think about how much money your beneficiaries would need to pay off your debts, cover your mortgage, and manage childcare or other living expenses. This can help you determine how much coverage is appropriate for your needs.

Here’s a quick way to figure out how much coverage makes sense for your family:

• Start by adding up your major costs: debts, mortgage, childcare, education, and your annual income multiplied by the number of years you want covered.
• Layer in extras your family may rely on, like kids’ activities, retirement savings, everyday spending, or end-of-life costs.
• Think ahead to bigger future goals, like college tuition for your kids.
• If you want help pressure-testing your number, talk to an insurance advisor or plug your details into our life insurance calculator for a quick ballpark.

Below are sample term life insurance quotes by coverage amount, based on PolicyMe rates for a 35-year-old, non-smoking applicant with a 20-year term:

Term life insurance quotes by age

An applicant’s age is one of the main factors that affects the cost of monthly premiums. The younger you are, the less “risk” you pose to the insurer. That’s why a general rule of thumb for life insurance is to lock in your rates while you’re young, because that will be the rate that you pay for the duration of your policy.

Here are starting term life insurance quotes by age, pulled from PolicyMe rates for a non-smoking applicant for $500,000 in coverage over 20 years:

Term life insurance quotes for smokers

Smoking status is another major factor that affects your term life insurance quote. Since smoking significantly impacts your health and life expectancy, smokers typically pay higher premiums for the same coverage.

In fact, smoking can shorten your life expectancy by up to 10 years. The good news? Quitting by age 40 can reduce that risk by up to 90%. If you remain tobacco-free for 12 consecutive months, you’ll qualify for the same rates as a non-smoker in average health.

Here are starting term life insurance quotes by age, pulled from PolicyMe rates for an applicant that smokes for $500,000 in coverage over 20 years:

Term life insurance quotes for seniors

Insurance typically becomes more expensive as you get older, but the upside is that your need for financial protection often decreases with age. By this stage, you may have paid off major debts and your dependents are likely more financially independent.

As a result, seniors can often offset the higher cost of coverage by choosing shorter-term lengths and smaller death benefits, which can significantly reduce premiums.

Here are starting term life insurance quotes for seniors, pulled from PolicyMe rates for a non-smoking applicant for $100,000 in coverage over 10 years:

Term life insurance quotes for pre-existing conditions

Much of your rate for term life insurance coverage is influenced by your health, because your term life quote is set by the insurance company based on how much of a “risk” you are for them to cover. Some things that the insurance companies will consider “higher risk” include:

• Health status (family history, pre-existing conditions)
• Smoking status
• Risky occupations or hobbies

Insurance underwriting is a standardized process insurance providers use to determine whether they’ll cover you, and if so, how much your premium will cost. This is why some applicants are required to do a medical exam during the application process.

How a risk rating impacts your quote 

Your quote is calculated using insurance rating: the risk category you're placed in after underwriting, which directly affects the price you pay for coverage.

If an insurer identifies a higher risk in covering you, you may be assigned a risk rating, typically ranging from A to J or 1 to 10, depending on the insurer’s system. For example, if you’re in poor health and receive a rating of “D” or “4,” you could end up paying approximately twice as much for your term life insurance policy.

Here’s an example of how your risk category would influence your starting quote of $100:

That’s why it’s wise to secure coverage while you’re younger and in good health. Locking in your term life insurance rate early can lead to significant long-term savings — potentially saving you thousands over the life of your policy.

Running with the risk category “D”/”4” example, you’d save $24,000 over 20 years by the time your term ends if you applied while you were still in good health.

How to find the best coverage for the most affordable price

Here are a few simple ways to get the most value from your term life insurance without overspending.

1. Apply for term life insurance coverage early

Rates go up with age and health risks — locking in early gets you the lowest pricing for the longest time.

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2. Choose a term that matches your needs

Don’t default to 20 or 30 years. Match your term to key life milestones (like your mortgage or the age your kids become financially independent) to avoid overpaying for time you don’t need.

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3. Go with a fully-underwritten policy

It might feel like more work up front, but full underwriting usually gets you better rates than simplified or no-medical policies.

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4. Compare apples-to-apples

Cheaper doesn’t always mean better. Look for coverage that fits your actual needs, with clear terms and no surprise exclusions.

Most providers determine your eligibility and life insurance premiums based on the information you provide during the application process. Typically, you’ll complete a short questionnaire covering your age, health history, lifestyle, and coverage needs.

What factors impact your term life insurance quote?

Insurance companies calculate your term life insurance quote based on risk. Specifically, how likely you are to pass away during the term of your policy. The higher your perceived risk, the higher your premiums. 

To determine risk, insurers look at several factors, such as:

• Age
• Health and medical history
• Smoking status
• Coverage amount
• Term length
• Gender
• Lifestyle
• Height and weight (your body mass index, specifically)

Even small differences, like slightly elevated blood pressure or applying a few years later, can affect your final quote.

How much term life insurance do you need?

The right amount of term life insurance for you is going to depend on your financial responsibilities.

At a minimum, your coverage should be enough to replace your income, pay off your debts, and support anyone who depends on you financially. For many Canadians, that’s going to include:

• Remaining mortgage debt
• Covering childcare, or future education costs
• Replacing lost income for a spouse
• Covering final expenses, like funeral costs

For example

Someone earning $80,000 per year with a $500,000 mortgage and young children may need significantly more coverage than someone with no dependents and no debt.

A good rule of thumb is to purchase coverage equal to 10 times your annual income, or you can get a slightly more tailored answer by starting with a life insurance calculator.

When thinking about how much life insurance you need, it helps to remember that a term life policy pays out a tax-free lump sum to your beneficiaries if you pass away during the covered period of time. 

That payout can be used to replace income, pay off debts, or cover long-term expenses like education. Unlike some life insurance plans that include savings components, term coverage is designed purely for financial protection.

FAQ: Term life insurance quotes

_{*The insurance quotes in this article are based on publicly available rates – pulled from both Compulife and PolicyMe but may vary depending on the applicant's own personal situation.}