15-Year Term Life Insurance in Canada

TL;DR: Is a 15-year life insurance term right for me?

A 15-year term is a great fit if you need protection for the next decade (and a bit) but don’t want to overpay for a longer policy. Choose a 15-year term if you:
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• Have older kids who will be financially independent within 10–15 years
• Are in the final stretch of your mortgage
• Are within 10–15 years of retirement
• Want coverage that’s more affordable than a 20- or 30-year term
• Only need temporary protection rather than lifelong insurance

How a 15-year term life insurance policy works

A 15-year term life insurance policy provides life insurance coverage for a set period—15 years, in this case. During this period of time, the policyholder pays a monthly premium in exchange for guaranteed fixed premiums and a tax-free death benefit if the insured person passes away. The beneficiaries receive the lump sum payout, which they can use for children’s education, mortgage payments, or general financial protection.

Unlike whole life insurance or universal life insurance, a term plan doesn’t include cash value components. A 15-year term focuses on affordability rather than building savings, making it one of the simplest life insurance options.

Many policies require underwriting, which evaluates your health history, lifestyle, and medical risks. Factors like age, smoking status, and overall health all play a role in determining your final premium. The application process may include a questionnaire, medical exam, or digital health verification, depending on the insurer.

You can estimate your coverage needs with a life insurance calculator and compare quotes from different providers to find a plan that fits your budget and long-term goals.

15-year term life insurance rates in Canada

15-year term life insurance generally offers lower premiums than 20- or 30-year terms, while still providing enough coverage for most short- to mid-range financial obligations. Below are sample monthly rates for healthy non-smokers across four common coverage amounts.

$100,000 coverage

$250,000 coverage

$500,000 coverage

$1,000,000 coverage

Who is 15-year term life insurance best for?

If you fit into one of the categories below, a 15-year term may offer the right balance of affordability and protection:

How to choose a term: 15-year vs. 10-year vs. 20-year

Choosing the proper term length comes down to three factors: cost, how long you need coverage, and whether you want to use laddering to save money over time. 

A shorter-term life insurance policy is almost always cheaper, but comes with a tradeoff: if you continue to need coverage, you’ll have to renew or reapply at a later age when premiums have risen.

If you want coverage that lasts precisely as long as your remaining responsibilities, choose the term that aligns with:

• Kids’ dependency years
• Mortgage amortization timeline
• Expected retirement date
• The year until your partner becomes financially independent

A 15-year term often lands in the middle and avoids both overpaying and needing to reapply too soon.

Laddering term life insurance policies

To “ladder” a term life policy means to combine multiple policies with different lengths so your coverage decreases as your financial responsibilities shrink. As each layer expires, your total coverage goes down—and so do your premiums.

You can stack a shorter-term and a longer-term plan around a 15-year term policy to align with multiple financial timelines, all while reducing long-term costs. This gives you peace of mind and your loved ones guaranteed stability during a difficult time.
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An example of laddering

• 15-year term covers the remainder of your mortgage and replaces income until retirement
• 10-year term covers your teens’ care and education needs until they’re financially independent

How to choose the right coverage amount

The right coverage amount should protect your family’s financial future if your income suddenly disappears. There’s no perfect one-size-fits-all number, but most Canadians fall between $250,000 and $750,000, depending on income, debts, and family needs. Here’s how to choose the right coverage amount for your family.

1. Start with the 10x income rule (to estimate quickly)

This method isn’t perfect, but it gives you a baseline for replacing a decade of earnings. Multiply your income by 10 and that’s a decent starting point.

2. Add up any significant debts or long-term financial obligations

Include anything your family would struggle to pay off without you—for example, mortgage, car loans, lines of credit, student loans, and large credit card debts. Your coverage should cover all of this.

3. Consider your dependents’ financial needs

Your coverage should last until your dependents are financially independent. Ask yourself:

• How many years will my kids rely on my income?
• Do I want to cover my children's post-secondary education?
• Does my partner rely on your income?

4. Account for everyday living expenses

Your policy should cover the essentials your income pays for, like rent or mortgage, utilities, groceries, childcare, transportation, out-of-pocket medical expenses, and so on.

5. Factor in your savings, investments, and existing insurance

You may be able to reduce your coverage if you already have RRSPs, TFSAs, a pension, emergency savings, or a group life insurance policy through work. Be sure that your total resources would still cover your dependents’ needs if your income were to disappear.

6. Keep your budget in mind

The ideal coverage for you should balance affordability and peace of mind. If the perfect number feels too expensive, consider:

• A shorter term that matches your shortest financial obligation
• A slightly lower coverage amount—some coverage is better than no coverage at all
• Laddering two smaller policies for more flexibility

The goal here is to get protection you can comfortably maintain, not the highest possible number.

What happens when the 15-year term ends? 

When your 15-year term expires, your coverage stops, but you usually have a few options available to you from here:

1. Renew your policy: You can usually renew your policy without a medical exam, but your renewal rates will be higher. This is often a good option if your health has changed and you may not qualify for a new policy.
2. Apply for a new term policy: You can pick a new term length and coverage amount (and even a new life insurance company), but you’ll need to reapply and your premiums will be higher since you’re older. Still, this is typically the most affordable option if you’re still healthy.
3. Convert to permanent insurance: You may be able to convert some or all of your term coverage into a permanent policy if you now have a need for lifetime coverage.
4. Let it expire. If your mortgage is nearly paid off, your kids are independent, or you’re close to retirement, you may not need coverage anymore.

FAQs: 15-year term life insurance