Editorial Review

The Best Life Insurance in Canada 2020

COVID-19 update: Amid the coronavirus pandemic, life insurance companies in Canada are still accepting new applications. For the latest information on how life insurance companies are managing COVID-19, see PolicyMe's handy guide.

We're all guilty of sending dressing room pictures to friends asking if a shirt looks good - it's always nice to get suggestions and opinions before any shopping choice. And it works well getting their opinion on the style or colour of something, but their opinion on your size? Not so much.

This same sentiment of wanting to make the best purchase can tie back to life insurance - why wouldn't you want to get opinions of people you trust on their experience? It's helpful to hear, but it may not be the right fit for you. After all, everybody won't be the same size!

That's why finding objective life insurance reviews is so important, and is exactly why we put together your go-to resource for reviews on different providers. This way, you can rest easy and know you got the best life insurance in Canada to fit your needs. We even have recommendations for specific shoppers, including:

  • Life insurance for couples in Canada
  • The best individual life insurance in Canada
  • The best bank owned life insurance
  • Best life insurance for smokers
  • Options for high risk life insurance for people with health issues

Let's get started!

What is Life Insurance?

Life insurance is for anyone who has a spouse, partner, or children who rely on them financially. You can get individual life insurance or buy plans as a couple, depending on your needs. This means that if your monthly income helps support your family's expenses (anything from groceries to debt payments to monthly retirement savings contributions, etc.), you're probably someone who needs life insurance.

To put it simply, life insurance is an agreement with an insurance company. You pay a monthly fee and in return, your insurance company agrees to pay out a lump sum of cash to your family if you pass away during the time that your insurance policy is active.

You can check out the table below to see a sample of monthly premiums and how they vary based on your insurer.

Comparison of Life Insurance Quotes

Insurer$250,000 20-year term life insurance
Wawanesa$18.23 / month
Empire Life$18.68 / month
RBC$19.62 / month
Canada Life$19.80 / month
Industrial Alliance$19.80 / month
Manulife$20.16 / month
Canada Protection Plan$20.93 / month
Sun Life$22.28 / month

Prices based on 30-year old male, non-smoker.

How Does Life Insurance Work in Canada?

The structure of a life insurance policy is simple - you pay premiums each month to an insurance company over an agreed period of time. If you pass away when the policy is active (while you are still paying premiums), the insurance company promises to give your loved ones a tax-free lump sum cash payment (the "death benefit") if anything happens to you.

This death benefit will help your loved ones reach their financial goals, paying monthly bills and maintain their lifestyle, even if your paycheck isn't coming in to help support them.

What Types of Life Insurance Exist?

Before we dive into the best life insurance in Canada, it's helpful to know what types of life insurance actually exist! The two options are term and permanent life insurance, which we'll break down.

Term Life Insurance

Term life insurance pays out a tax-free death benefit to your loved ones only if you die within a specified number of years (usually 10, 20, or 30 years). Term life is the right option if you want protection for the years that matter most (when you still have a mortgage & children in the house).

For most people, the term life insurance company they choose is the one that offers them the best rate. Check out some sample life insurance quotes for a healthy-female applying for $500,000 of 20-year term life insurance.

Insurer 30-year-old  40-year old
Wawanesa Life $22.50 / month $32.49 / month
Empire Life $22.50 / month $35.10 / month
BMO $22.95 / month $36.90 / month
RBC $23.31 / month $34.83 / month
Canada Life $23.85 / month $37.80 / month
Industrial Alliance $23.85 / month $37.80 / month
Manulife $24.86 / month $37.78 / month
Sun Life $26.10 / month $40.50 / month

Want to get a personal life insurance quote? Check out PolicyMe's handy tool to compare life insurance quotes in Canada.

When comparing quotes online, remember these are helping you get a basic idea of how much your monthly premiums would be if approved at standard rates. When you submit your application, it's sent to an underwriter whose job it is to review your information and to calculate the true cost of insuring you. They will review your health, financial wellness, and lifestyle data and set a final price for your policy (don't worry, 90% of PolicyMe applicants are approved at the quotes they were given!).

Permanent Life Insurance

Permanent life insurance pays out a benefit to your beneficiaries no matter when you die (hence why it is called permanent insurance). Permanent life insurance comes in a couple of different forms, including whole life, universal, or variable life insurance.

Permanent life insurance policies are much more expensive than term life insurance policies because the policy also acts as an investment account. Your premiums are designed to build cash value over your life. But don't be fooled - this is NOT a cost-free financial investment, and it turns out to be much more expensive and inflexible than other ways of investing.

Permanent life insurance policies tend to be less straightforward than term insurance. You'll want to understand all the fine print and details before buying this kind of policy. For example, be sure to know the terms of the cash value component. Every permanent life policy has a guaranteed interest rate so you should understand how these differ by company.

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Top 5 Companies for the Best Life Insurance in Canada

You probably know by now that it's pretty easy to get life insurance quotes, right? What's downright confusing is trying to compare the quotes and understand what each one offers. So let us do the legwork and provide detailed reviews for some options for the best life insurance in Canada for you!

To determine the best life insurance in Canada for each group, we looked at a couple of key factors, including price, approval time, ability to apply online, and flexibility in available plans.

As of 2020, the best life insurance companies in Canada include Manulife Financial, Wawanesa Life, BMO Insurance, Canada Protection Plan and Industrial Alliance. We've even flagged which policies are best depending on different characteristics (like if you want insurance through a bank or have underlying health issues) so let's dive in!

Pick #1 - Manulife Financial

Best Life Insurance for Couples

Manulife is one of the biggest insurers in Canada, with over 30 million customers worldwide. It is also one of the oldest insurers and was founded in 1887. Manulife offers a wide range of life and health insurance products as well as group life insurance plans. Many customers may recognize the brand if they have some health coverage through work!

Manulife's Combined Family Term life insurance policy acts like a family policy that covers both you and your partner. It operates like having two separate policies (2 separate death benefits will be paid) but there is a discount on the policy for combining them into one.

Better yet, insurers actually offer discounts when you apply with your spouse! This discount on life insurance for couples can be anywhere from $3-5 per month (as the insurers only charge what they call a "single policy fee" on combined policies). Manulife adds an additional 3% savings when you select the same coverage amount and policy length for you and your spouse. They are the only ones in the industry to offer the extra 3% savings.  

Top Things to Consider When Choosing Manulife

  • Low Cost: Usually the most affordable option for couples applying together
  • Faster Approval Time: Manulife has a faster than average turnaround time. In 2017, Manulife launched an accelerated underwriting program for its term and permanent life insurance products. This means they offer fluidless medical underwriting (no blood or urine tests) for over 75% of applicants.
  • Easy Access to Policy Documents Through eDelivery: Quick delivery of your policy documents right to your inbox

Pick #2 - Wawanesa Life Insurance

Best Life Insurance for Individuals

Wawanesa is one of the oldest insurers in Canada, founded in 1896 in Wawanesa, Manitoba. It's headquarters now sits in Manitoba; however, it is licensed in all provinces across Canada. Wawanesa Life is rated by A.M. Best as part of the overall Wawanesa organization. Wawanesa Life and the parent company, The Wawanesa Mutual Insurance Company are both rated A (Excellent).

Wawanesa's Lifetime term product offers a huge selection for anyone applying. Their plans consist of 10, 15, 20, 25 and 30-year policy lengths. They also offer some of the best prices in the market, and most applicants will find that Wawanesa ends up being the most affordable option for their needs!

Top Things to Consider When Choosing Wawanesa Life

  • Low Cost: Wawanesa's life insurance products are generally some of the most affordable products on the market for all age groups!
  • Lots of Flexibility: Applicants are limited to just 2 or 3 policy lengths. With Wawanesa, applicants can apply for 10, 15, 20, 25 or 30-year policy lengths.
  • Easy Policy Laddering: Think you can benefit from a personalized ladder policy with multiple coverages at different policy lengths? With their large number of policy lengths to select from, Wawanesa might be the insurer for you.

Pick #3 - BMO Insurance

Best Life Insurance Through a Bank

BMO Insurance is a member of BMO Financial Group, one of the largest banks in Canada that was founded in 1817. A.M. Best Company gives BMO a Financial Strength Insurer Rating of A, making them an excellent choice.

With competitive pricing and a range of policy options, BMO is a good potential option for life insurance shoppers who want bank owned life insurance. Cost tends to be one of the most important factors in choosing a life insurance company and BMO has some of the most competitive costs in the industry. However, BMO does fall short in the length of time it takes to get approved. On average, shoppers will have to wait 4-6 weeks before they get an approval on their policies which is a deal-breaker for some!

Top things to consider when choosing BMO Financial

  • Low Cost: BMO has some of the most competitive costs in the industry
  • Long Application Process: BMO requires enhanced medical requirements for customers looking to buy non-face-to-face, making for a longer than usual time to get approved.
  • No eDelivery: Getting your life insurance policy will take some time as BMO will need to print and deliver the paperwork for you vs. sending the documents electronically.

Pick #4 - Canada Protection Plan

Best Life Insurance for People with Severe Medical Diagnoses

Canada Protection Plan is a leading provider of No Medical & Simplified Issue Life Insurance in Canada.  That means that they do not require the extensive medical telephone exams needed with the other insurers in Canada. Compare Canada Protection Plan life insurance quotes today.

Shopping for a life insurance policy can be especially intimidating for anyone recently diagnosed with a severe health condition such as a heart attack, cancer, or a stroke - you may need high risk life insurance, from the perspective of your provider. Simplified issue or guaranteed issue products are life insurance products that do not require medical exams (or sometimes even medical questions) to qualify. The trade-off is that the policies are much more expensive than traditional term life insurance and usually cap you on the total amount of coverage you can buy. But if you are unable to purchase regular term insurance, a simplified issue or guaranteed issue life insurance policy could be an excellent way to get some life insurance coverage and a small death benefit for your family.

Top Things to Consider When Choosing Canada Protection Plan

  • Not for Everyone: Canada Protection Plan offers many options for elderly customers and those that have not been able to get insurance in the past. However, if you are young and healthy, this is probably not the right insurance provider for you.
  • No Medicals Required: A Canada Protection Plan application requires no fluids, no doctor's notes, and no medical exams. 
  • Fast Approval Time: Given there are no fluids or medical tests, Canada Protection Plan has some of the fastest approval times in the industry. Often, customers will be approved within as little as 48 hours!

Pick #5 - Industrial Alliance

Best Insurance for Smokers

Founded in 1892, iA Financial Group is one of the largest insurance and wealth management groups in Canada, with operations in the United States.

If you are trying to find life insurance for smokers, Industrial Alliance may be the right company for you! On average, they priced more competitively for smokers than other life insurance companies that we compared.

If you smoke cigarettes, chew tobacco, or even vape, you'll probably pay more for life insurance. Why? As you probably know, smoking puts you at a higher risk of developing health issues later in life. And as a result, smoking puts you into a higher risk category in the eyes of your life insurer. Smoker/ tobacco rates can be up to 2x to 3x more than non-smoker/non-tobacco rates. The good news is iA tended to have the best rates for smokers in the industry.

Top Things to Consider When Choosing Industrial Alliance

  • Average pricing: Industrial Alliance prices are in line with the rest of the market. However, they do have above average pricing for select customer characteristics (smokers, under 40, and female).
  • Lots of Flexibility: Industrial Alliance's Pick-A-Term life insurance product stands out from other coverage on the market by allowing applicants to choose their policy length with anything from 10 to 40 years

Full List of Canadian Life Insurance Company Reviews

Canada Protection Plan Life Insurance Review

Our Review: 4 out of 5

BMO Life Insurance Review

Our Review: 4 out of 5

Industrial Alliance Life Insurance Review

Our Review: 4 out of 5

RBC Life Insurance Review

Our Review: 4 out of 5

Canada Life Insurance Review

Our Review: 3 out of 5

TD Life Insurance Review

Our Review: 1 out of 5

Manulife Life Insurance Review

Our Review: 4 out of 5

How Much Life Insurance Coverage Do You Actually Need?

Now that you have a provider in mind, you need to figure out how much life insurance you actually need. Your life insurance policy should be as unique as you, including coverage. Finding the right policy involves an understanding of your financial situation, your family structure and your lifestyle. But even two families with the same characteristics might require different recommendations - the best life insurance for you may not be right for your neighbour.

It's important to get personalized advice when searching for your life insurance policy. At PolicyMe, we believe that recommendations should be as unique as the needs of you and your family, so they have access to the security they need at the best possible value.

Our easy-to-use life insurance checkup helps you in setting your objectives by looking at all the personalized factors unique to you and your family. Our proprietary algorithms do the rest, analyzing your partner's income, family savings and family spending habits to calculate the amount of coverage that matches your objectives.

Getting the best life insurance in Canada for your needs doesn't have to be a headache. Armed with these reviews and personalized quotes, you'll be able to sign up with the confidence you're making the best choice for you and your loved ones.