Should you get term or whole life insurance?

Determine which type of coverage is better for your family’s financial needs

cheapest term life insurance canada

Head-to-head: term life insurance versus whole life insurance

Permanent coverage

Whole

Term

Best suited for those with high-net-worth with complex estate planning needs

Best suited for the average Canadian family

Type of coverage

Who it's for

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Average cost

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Payout

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Option to convert or renew policy

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Cash value

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Rate of return

Costs up to 7.5x more than term

Comes with surrender fees, taxes and other restrictions

Coverage lasts as long as you need

Starts at around $20-30 per month

Policies are easy to understand, with little-to-no fine print

Your loved ones get a tax-free lump sum if you pass during your term

Yes

No cash value

None. Save with term and put the difference in traditional investment vehicles

Policies

Death benefit is tax-free, but beneficiaries are taxed on the policy’s interest

No

Builds cash value, option to withdraw as a loan

~3.5% (compare to roughly 4.8% from the stock market or 8.5% from index funds)

Get term life insurance. Invest the rest.

Average cost of term and whole life insurance

Based on public rates for $500,000 in coverage for a 35-year-old, non-smoker. *PolicyMe rates are calculated with the 10% couples discount in the first year.

$261.10

$25.58

Whole

Term (20-year)

PolicyMe term (20-year)*

$314.25

$34.11

$34.11$30.70

Woman

Man

$25.58$23.02

Check My Term Price

Whole life insurance, in a nutshell

Should you get whole life insurance?

Lasts your entire life, mixing a death benefit with cash value

Premiums are fixed, so you pay the same rate over the course of your lifetime

More costly than term life insurance, sometimes up to 7.5x more

Ideal for very high income earners seeking tax-deferred options

For most, term might be a better financial safety net for their family

Term: the smarter coverage option for Canadian Families.

Learn more about why thousands of Canadians choose affordable term life insurance they can count on; when their families need it most.

About PolicyMe term life insurance

PolicyMe is a Canadian digital insurance solution that makes financial protection for families simple and affordable. It was founded by two insurance consultants, Andrew Ostro and Laura McKay, and an experienced Chief Technology Officer, Jeff McKay. PolicyMe has partnered with Canadian Premier, a Fortune 500 company Securian Financial subsidiary.

How PolicyMe makes money

PolicyMe operates like any other insurer: we sell insurance products, which are underwritten by Canadian Premier. The great news is that because we've automated operations, cut out the middleman and reduced underwriting requirements (such as medical exams), we're able to pass along the savings to you, while still delivering the same quality of coverage.