Best Life Insurance for Canadian Families (2026 Guide)

What is the best life insurance for families?

The best life insurance strategy is different for every Canadian family, but most families would benefit from: 

• A term life insurance plan for each parent
• Child coverage if it’s available as a free or low-cost add-on

By putting life insurance in place early, you can protect your family’s financial future against the costs associated with passing away while your dependents are reliant on you.

‍New homeowner or looking to buy property? 42.3% of applicants say that a mortgage was a top reason for buying term life insurance. It’s wise to consider insurance when taking on a major debt like a mortgage, especially when it’s a joint debt.

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Life insurance for parents

Looking to buy life insurance as a new parent? You may want to check out our guide to life insurance for parents, which compares life insurance options from leading providers based on your child’s age and your future financial goals.

How much life insurance does a family actually need?

A family in Canada needs enough life insurance to protect their long-term financial goals, which includes income replacement and debt coverage. The most common coverage amount is $500,000, but it depends on your family’s costs.

Consider your unique financial situation, including things like:

• Mortgage/rent 
• Childcare costs
• Other household costs
• Education savings goals
• Outstanding debts
• Partner income replacement

A common rule of thumb is 10-15x your family’s annual household income. To keep it simple, think about how many years your family would need financial support if you died (and then add major expenses like mortgage and tuition for dependents). The average coverage amount for homeowners in Canada is $762,600 vs. $553,100 for non-mortgage owners.

Why families delay buying life insurance (and why that can cost more later)

Families may not buy life insurance because coverage feels too expensive or because they feel young and healthy. 

But take note that buying life insurance earlier means lower premiums and easier approval, and waiting can raise the cost of your coverage. For example, coverage starts around $19 per month for a healthy 18-year-old woman and increases to $37 per month at age 30. 

Premiums tend to increase with age, as health risks increase. Waiting also means you could develop new health conditions which might make policies harder to qualify for.

How much does family life insurance cost?

Family life insurance costs between $40 and $100 per month for most families, and that’s if both adults are insured. 

Here are average rates for a 20-year term policy with $500,000 of coverage for nonsmokers—this table shows the 10% discount that couples receive with PolicyMe on first year premiums.

^{* These figures are based on publicly available rates for PolicyMe term life insurance for applicants of average health for a 20-year term with $500,000 in coverage. The figures include the 10% couples discount that eligible applicants get within the first year.}  

Note that you might expect to pay more for longer term policies and higher coverage amounts. You’ll also pay more if you’re a smoker or have a high-risk profession.

Get the best life insurance policy for your family

Each family’s needs are different. Before comparing life insurance options to build your family’s financial strategy, it’s important to understand what your family needs.

Can you answer these 5 key questions?

Before shopping for life insurance, make sure you know the answers to these five key questions.

• Who should your policy cover? Most family life insurance plans should cover parents, since other family members depend on their income and support for daily living expenses and major financial goals.
• Who will your beneficiaries be? Minors can’t legally receive the death benefit from a life insurance policy, so think carefully about naming a legal representative or trustee to manage the money in the event of your death.
• Joint, individual, or combined policies? Joint insurance policies for parents are the cheapest option, but can leave gaping holes in your coverage. In most cases, individual or combined policies deliver the best coverage.
• How long do you need coverage? If you’re buying life insurance to give your children financial protection, your plan(s) should last until the youngest family member is financially independent. A 20-year term is most common, but longer or shorter terms are available along with lifelong coverage for special circumstances.
• How much life insurance coverage do you need? Most families need coverage equal to at least 7–10x the primary earner’s annual salary, but you can conduct a quick and thorough needs assessment using PolicyMe’s free online life insurance calculator.

In the tables below, we’ve identified the best life insurance plans for each member of your family to help you build your own strategy for long-term financial security.

“A lot of people come into the conversation with misconceptions about life insurance. Some expect a one-size-fits-all family policy, but in Canada, coverage can be built through a mix of individual and joint policies depending on your needs.” — Christelle Arouko, Life Insurance Advisor

The best life insurance for women

^{* For each product, we calculated the average monthly premiums for a female non-smoker between 30-44. The results show the approximate cost of a 10-30-year term life insurance policy with $600,000 in coverage.}

The best life insurance for men

^{* For each product, we calculated the average monthly premiums for a male non-smoker between 30-44. The results show the approximate cost of a 10-30-year term life insurance policy with $600,000 in coverage.}

The best life insurance for children

In general, only parents need life insurance to protect their children, because life insurance provides a payout when the insured dies. Because children don’t have dependents, they should function as life insurance beneficiaries, but don’t need a policy of their own. In fact, most term life insurance policies have a minimum policyholder age of 18. 

That said, many life insurance companies offer child term coverage as an add-on to a parent’s life insurance policy, either as an optional rider or as a built-in policy benefit. All PolicyMe life insurance policies include $10,000 of complimentary child coverage, offering a tax-free lump sum payout in the event of the death of any of the insured’s children. 

Other life insurance companies may offer child term coverage as an optional benefit for an added cost. If it’s available, you may want to add it to your policy, but it may not be worth paying extra for. 

Women were more than twice as likely than men to name their children as their beneficiaries, according to a recent report from PolicyMe. Speak directly with your co-parent, if you have one, about the best ways to protect your children.

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Whole life insurance for children

The most common type of life insurance purchased as a standalone policy for children is whole life insurance, which offers fixed lifelong premiums with a cash value component that grows over time. It’s often seen as a way to invest in a child’s future by locking in low rates and building value that the child can access in adulthood.

If you’re considering buying this type of policy for your child, speak with a licensed insurance advisor about the potential benefits and downsides. Whole life insurance is not cost-effective for most Canadians, so it’s worth exploring other options to provide for your family’s future.

Does every family need life insurance? 

While some Canadians don’t need life insurance, if you have a family then one or more family members likely need life insurance. 

Life insurance exists to protect your loved ones against the financial consequences that could follow your death. 

It may be a good idea if: 

• Anyone depends on your income (children, partners, parents, siblings, or other family members)
• You have major financial responsibilities (mortgage, student loan debt, or education costs) that would become a burden to your family or impossible to achieve if you died 
• Your family could not afford to cover final expenses such as medical bills and funeral costs

It may not be ideal if:

• You have no major debts
• You’re single
• You have no children or dependents

Families and life insurance go hand in hand. It’s up to you to decide what life insurance looks like for your family. For instance, you might be more concerned about whether life insurance is haram or halal or you might be a cancer survivor with questions about coverage options.

“When two people commit to building a life together—whether that means marriage, buying a home, or starting a family—the focus is rightly on hopes and dreams. But true commitment also includes planning for the unexpected. Life insurance is not about being pessimistic; it’s about being responsible, loving, and forward-thinking. You're not planning for death; you're planning for life to keep going for the one you love.” — Ivana Govedarica, Life Insurance Advisor

FAQs: Best family life insurance