Life insurance is for anyone who has a spouse, partner, or kids who rely on them financially. This means that if your monthly income helps support your family’s expenses, you’re probably someone that should consider a term life insurance policy. Think expenses like groceries, debt payments, tuition, monthly retirement savings contributions, etc.
On the other hand, if you’re retired or don’t have any financial dependents, a term life insurance policy might not benefit you.
Each life insurance company is different, but for PolicyMe, the average cost of life insurance for a man is $32 monthly for a 20-year term life insurance policy for $500,000. The Canadian Life & Health Insurance Association found that the average life insurance coverage amount per household in Canada is $442,000.
We provide a full overview of the average cost of life insurance by age, gender, coverage amount, and policy length, along with real-life examples in this piece about the cost of life insurance in Canada.
There is no single life insurance product that works best for everyone. But for the average Canadian family, term life insurance is the better option to protect their families.
Essentially, the purpose of life insurance is to protect the people that financially depend on you. That means that most people only need life insurance for the years when your dependents need it the most. This could be when your kids are still living at home or when your mortgage’s principal balance is at its highest.
Your life insurance needs will shift over time, and so should your coverage.
Whole life insurance is a product that should only be considered by high-net-worth individuals and possibly by Canadians aged 55 and up.
To give you a quote for your life insurance premiums, life insurance companies will ask you for some personal information like your age, gender and smoking status. This information establishes a base rate, and then your premiums might increase based on your medical history.
They use this information to calculate the potential risk of insuring you.
You should also keep in mind things like your desired policy type, amount of coverage, and policy length, so you can decide during the application process. This is put together with your personal information to give you a quote on your monthly premiums.
A life insurance beneficiary is a person that receives a death benefit in the event of the policyholder’s passing.
You can name more than one person as a beneficiary for your life insurance policy, like your partner or kids.
The Financial Consumer Agency of Canada explains, “You can name your spouse, another family member, friend or charitable organization as beneficiary.
[...] If you [name multiple people], your insurance company will divide the death benefit among them. You may assign different proportions of your life insurance benefits to each beneficiary.”
Life insurance is a tool to protect people that depend on you financially in the worst-case scenario. To decide who you should name as your beneficiary(ies), ask yourself if the person would be able to support themselves without you.
Comparing rates is an important step to getting the right policy for you, at the right price.
There are many factors that go into calculating the cost of your life insurance premiums. And each life insurance company has different methods for weighing out the risk of insuring someone, but here are the main things that impact your rate:
Because every life insurance provider has a different approach to calculating the risk of covering you, rates will vary. On top of this, for some companies, rates can trend higher because of the administrative costs and advisor commissions.
PolicyMe’s licensed advisors don’t receive commissions. Our promise is to never pressure or upsell more coverage than you require. In fact, we'll even tell you if don't require life insurance.
You don’t need a medical exam to get a “no medical” or simplified issue life insurance policy, but those policies are much pricier and you usually can’t get as much life insurance coverage. There are cases where no medical life insurance may be a good choice, like if you normally don’t qualify for life insurance due to health issues. But it’s typically not the right choice for the average Canadian family.
There is a chance that you need to have a medical exam done if you apply for a term life insurance policy with PolicyMe. And unlike simplified issue life insurance, your policy would still be fully underwritten with more affordable premiums. 52% of eligible applicants get approved with no additional medical requirements.
You might be eligible if:
If you’re asked to get a medical exam, we make it as easy as possible. A nurse will arrive at your home for a 20- to 30-minute visit, for free. After that, you can get a term life insurance policy that’s better equipped to cover your family.
The main advantages to getting a term life insurance policy are around cost and flexibility.
Broadly speaking, there are two main types of life insurance: permanent life insurance and term life insurance.
Permanent life insurance lasts for your whole life, while term life insurance covers you for a specific period of time.
The type of life insurance that is best for your needs depends on the following factors:
For the average Canadian family, term life insurance provides the right amount of coverage, for the years when they need it the most.