150 Insurers out of
77 Life Insurers.
Quick, easy
hassle free

Compare & get lowest quotes

From Canada's top insurers

life Insurance

Life Insurance is an important instrument in finances aimed at providing a safety net for persons and their families from uncertainty brought about by untimely eventualities like the death of the insured. Life insurance is an important part of financial planning for people all over the world, and Canada is no different. To give you a better idea of what life insurance is like in Canada, why it’s important, and some other information that might be useful for people who are thinking about getting that policy, read on.

Canada has one of the most sound and regulated insurance markets. The country’s Life Insurance industry is subject to regulation by both federal and provincial regulatory bodies to ensure the protection of the best operating standards for insurance consumers.

In Canada, various types of Life Insurance policies exist that offer coverage for some given time. Whole Life Insurance and Universal Life Insurance offer lifetime coverage and are used as a form of investment. The choice of policy often depends on the individual’s financial goals, age, health, and other personal circumstances.

Having consumer protection is one of the most important things about life insurance in Canada. The policyholders are assured of having some rights, and the companies offering the insurance are issued with directives towards openness and ethical tendencies. This has brought trust and confidence among Canadians in this sector.

So then, the life insurance provided in Canada is far more than just a financial product; it forms part of an individual’s core financial plan. People can rest easy knowing that their family will be financially secure even in the event of an unexpected circumstance. Understanding the complex workings of the Canadian life insurance market is essential, whether one is shopping for life insurance for the first time or has to examine current policies in order to make wise choices.

What is Life Insurance?

Life Insurance, at its core, is a contract between an individual and an insurance company. In such a contract, the person (policyholder) is supposed to make payments of a stipulated sum of money, known as the premium, in exchange for a promise from the insurance company that it will pay a financial benefit to the named beneficiaries of the policyholder upon death.

In the Canadian context, Life Insurance serves multiple purposes:

Diverse Offerings: There are several options available. Given that Canada offers a few different kinds of life insurance to suit the majority of demands, these can generally be listed:

Regulation: Canada has sufficient regulations on the life insurance market to safeguard consumers. The Canadian federal government and provincial governments regulate the industry to ensure enough transparency, ethical practice, and the financial solvency of the providers.

Tax Advantages: Life insurance proceeds are generally exempt from tax levies when payable to the beneficiaries. In addition, the cash value that grows inside a Permanent Life Insurance Policy is generally tax-deferred, making it very attractive for inclusion in most Canadians’ estate planning.

Additional Riders: The majority of Canadian Life Insurances have additional Riders or Endorsements that can be added to the base policy. A few of the common ones would include

Critical Illness Coverage, Disability Waiver of Premium, and Accidental Death Benefit. In general, this highly complex financial tool affords protection and, in some instances, peace of mind and even acts as an investing vehicle. Considering such an extensive product category and the importance insurance holds in financial planning, it is very necessary for people to assess their needs and even consult professionals to decide on a policy.

What does Life Insurance cover?

The traditional life insurance in Canada is one that normally gives money that is supposed to take care of the beneficiaries of the person who owned the policy upon their death. The quantity or kind of coverage, however, may vary according to the type of policy and additional riders or endorsements added to it. Here is an outline of what Life Insurance generally covers in Canada.

Investment Component: In some policies, for instance, Whole and Universal Life Insurance, an aspect of the investment happens, whereby a few portions of the premiums are invested, and in the long run, the amount accumulates some cash value. This is the value that can be borrowed against or even withdrawn, thus giving the policyholder financial flexibility.

In this view, the main role of Life Insurance is to provide financial security in case the policy owner dies. Its coverage may be multifaceted, catering to all needs and tastes. Consulting with an expert who can provide the best advice based on specific circumstances and needs is always advised.

Get The Best Insurance Quote From Canadian L.I.C

Call 1 844-542-4678 to speak to our advisors.

What does Life Insurance not cover?

While life insurance provides a vast scope of coverage, certain exclusions apply under which a benefit might not be paid or might be paid in a lesser amount. This exclusion, like others, should be duly informed to the policyholder so as to save him or her from any surprises. The following is a quick look into some common exclusions and limitations in Canadian Life Insurance contracts.

The Life Insurance policy document, including the exclusions and limitations, should be read carefully before the policy is issued to the proposer. He/she can seek advice from an insurance professional or any legal advisor to interpret the terms or details of the policy properly to protect his interests and those of his beneficiaries.

How Does Life Insurance in Canada Work?

Simply put, Life Insurance in Canada is when a policyholder pays into the policy, in return for which some beneficiaries will receive a payout—usually called a “death benefit”—at the event of the policyholder’s death. A summary of how life insurance typically works goes like this:

If Life Insurance is a product that you’re considering, then always deal with a Life Insurance broker or financial advisor only. They are going to be the ones listening to you on what exactly you want and advising where necessary.

What is the eligibility for Life Insurance in Canada?

The many aspects that determine eligibility for Life Insurance in Canada largely pertain to the risk that insurance companies are likely to carry with the person to be covered. Though specific criteria may vary from one insurer to another, these are some general factors considered for eligibility:

Though there was no single factor (such as, for instance, a medical condition) that could render an individual absolutely uninsurable in Life Insurance, it, of course, could have an impact on the way the premium rates or the terms thereof are fixed. If one company is unable to provide an application or is unfriendly in its terms, another company may have different criteria and may be friendlier. As always, one should speak to a licensed insurance broker or agent for advice that best fits your case and needs.

Why is Life Insurance important?

Canada needs life insurance for a lot of different reasons. It’s just as important for them as it is for many other countries. Following is the reason why many Canadians consider Life Insurance an indispensable part of financial planning:

The perceived importance of Life Insurance varies depending on individual needs and circumstances. Nevertheless, to many Canadians, it remains a safety net of very high importance—that is, protection from life’s uncertainties. Just like any financial product, it has to be discussed with professionals in order to find the most convenient coverage in every particular case. 

Which Life Insurance is the best?

Determining the “best” Life Insurance in Canada is subjective and depends on individual needs, objectives, and circumstances. However, several prominent insurance companies in Canada offer a range of Life Insurance products. It’s essential to choose a product and insurer that aligns with your specific requirements.

Here’s a breakdown of the types of Life Insurance and when they might be considered the best choice:

Popular insurance providers in Canada include:

When determining the best Life Insurance for you:

Remember, the best Life Insurance is the one that fits your personal and financial needs, giving you peace of mind that your beneficiaries are protected.

What Life Insurance should I get?

The choice of the right Life Insurance policy to take up in Canada involves many individual considerations, financial objectives, and requirements of the people you are supposed to take care of. The following are guidelines to help you decide the best policy for you.

Use online Life Insurance calculators to estimate the amount of coverage you might need.

Speak to a financial advisor for personalized advice.

Choose a beneficiary to benefit from the policy: a spouse, children, business partner, or a charitable organization.

Look deeper into additional features and riders like Critical Illness Cover, Waiver of Premium, or Child Riders if any of those are pertinent to your individual context.

Obtain quotes from multiple insurance providers to compare costs and coverage.

Consult with a licensed insurance broker who can provide options tailored to your needs.

The “best” Life Insurance is one that befits your individual circumstances and gives just the needed level of coverage at payable costs. Always seek professional advice and shop around before deciding.


100% of customers recommend us!
The Best Canadian Insurance Advisor!

Ali Shahzad
Ali Shahzad
Dealt with Akansha, she was professional and quite helpful in answering all questions
Nusrat Ahmed
Nusrat Ahmed
akanksha....105 great advisor one call solution solved .
Mithun Das
Mithun Das
Was really nice dealing with Canadian LIC for setting up supervisa insurance for my mother. Harpreet from the customer support team was very responsive and I was able to get the things sorted out quickly.
Chona Limoico
Chona Limoico
Excellent service
Wafaa Hammoud
Wafaa Hammoud
highly recommend Canadian L.I.C. insurance. Very knowledgeable, friendly and helpful. I called and got help right away. The service was quick, clear and easy. Akanksha gave the best price and service by following up. Keep it up, great job.

FAQs related to Life Insurance

Here are some frequently asked questions (FAQs) related to Life Insurance in Canada:

Term Life Insurance provides only time-based insurance assurance (such as 10, 20, or 30 years). Should death occur to the insured within the stipulated period of insurance, the death benefit is payable. Whole Life Insurance is an insurance cover extending over the whole life of the insured, containing a cash value element that increases over time and level premiums.

Most traditional policies require a medical exam after a certain face amount. However, there are policies that have been set up where there is no requirement for a medical exam at all. The rate of these, however, may have higher premiums or lower coverage.

Generally, death benefits are not taxed in Canada, though under some conditions, there are some tax impacts on the cash value accumulation of some Permanent Policies.

Yes, you can have multiple Life Insurance policies from the same or different insurance providers.

Whenever the policy term gets over, coverage also gets over, but then, depending upon the terms of the policy, a policyholder may have the option to renew the policy, convert the policy into a permanent policy, or purchase a new policy.

This figure will vary with every individual as this has to be based on the debts, income, dependents, and financial goals. One may consult a financial adviser or even take the help of online calculators to determine the right cover.

Yes, basically, you have the right to change the beneficiary, unless an “irrevocable beneficiary” has been named. Always look through your policy, and if changes are made, discuss them with the insurer. 

The variables likely to determine the most probable premiums to be paid are the following: age, state of health, lifestyle choices and the kind of policy chosen, even the amount of coverage and the length of the term in some cases.

Under a normal grace period, a further 30 days are granted to make the missed payment without losing coverage. If this payment has not been made within that period, it is this point at which the policy may lapse, and thus coverage would end.

If at all, it might affect the premiums or the type of policy one is going to get. There may be conditions that would attract higher premiums; there would be others that would attract exclusions or limitations or even a decline.

Most Life Insurance policies have a clause by which no death benefit is paid out in case the insured takes his life within the first two years of the policy. Thereafter, generally, coverage would apply. Always review the specific terms of a policy.

Some may even provide such an insurance to non-residents, but with different terms, eligibility, and different premiums. It is best to discuss this with a broker or the company itself.

Term Life Insurance policies cannot be cashed out as they do not accumulate cash value. However, some Life Insurance policies have that aspect of cash value that could be paid out or borrowed against during the lifetime of the policyholder, for example, Whole Life and Universal Life. Policyholders should be aware that cashing out a policy may have tax implications and will reduce the death benefit.

Normally, the benefit paid out from a policy of Life Insurance is non-taxable and paid tax-free to the beneficiary in Canada. However, where an assignment has been made, such as collateral for a loan, this could muddy the water, as in such cases, the benefit would be subject to tax. Additionally, if the policy accrues a cash value, certain withdrawals or loans against this cash value may be taxable.

Generally, the death benefit paid out from a Life Insurance policy is not taxable and is paid tax-free to the beneficiaries in Canada. However, there may be deductions from the premiums of Life Insurance under certain situations, such as when one is self-employed and the policy of insurance is being utilized as collateral for a business loan. Always consult with a tax professional for advice on your specific situation.

Normally, Whole Life and Universal Life Insurance cover cash value. Whole Life policyholders have some assurance for cash value growth at a guaranteed rate of return. On the other hand, the cash value in the Universal Life Policy can vary based on the performance of selected investment accounts. This is often chosen by those interested in a Permanent Life Insurance option that has a savings or investment component.

  • The major benefit is the financial security to your beneficiaries upon death. They normally receive a certain death benefit that may be applied to living expenses, paying off debts, and other necessary charges, such as funeral costs. 
  • Many policies offer the option to add riders for additional coverage, such as critical illness or disability.
  • Some types of Life Insurance policies have an investment or savings component, building cash value over time.
  • The death benefit is usually tax-free.
  • It can help preserve the policyholder’s estate by providing liquidity for estate taxes and other expenses. 
  • Term Life Insurance only provides coverage for a specified period and does not accumulate any cash value.
  • Premiums may be higher for older applicants or those with health issues.
  • There might be exclusions for certain causes of death, such as risky activities or pre-existing conditions.
  • Permanent Life Insurance, while it does accumulate cash value, generally has higher premiums than term insurance.
  • It can be complex to understand all the terms and conditions of various policies.
  • Contact the insurance company promptly to inform them of the death.
  • Fill out a claim form, which the insurance company will provide.
  • A duly filled claim form and a certified copy of the death certificate are to be submitted with any other requirements found necessary, including proof of identity for the beneficiary.
  • The insurer will review the claim, and if everything is in order, they will process the payment.
  • Term Life Insurance—This is a policy that offers protection for a certain stated period, term, or time, and in case the insured dies, the company will only pay a death benefit to the beneficiary.
  • Permanent Life Insurance: Offers to cover for the whole life of the insured, including Whole Life and Universal Life, which builds cash value.
  • The cost ranges usually define the kind of policy, the amount of coverage, and the age, health, and lifestyle of an insured. Besides, Term Life Insurance is cheaper than Permanent Life Insurance.

Determine your coverage needs and budget. Shop around and compare quotes from multiple insurers or work with an insurance broker. Complete an application, which may include a health questionnaire and possibly a medical exam. Review and sign the policy contract once approved and pay the initial premium.

  • Personal information: age, gender, weight, and occupation.
  • Health history: medical conditions, past surgeries, medications, family health history.
  • Lifestyle information: smoking status, alcohol use, driving record, and potentially hazardous activities.
  • Financial information: income, other insurance policies, and financial dependents.
  • The insurance company starts the underwriting process to assess risk based on your information.
  • You might be required to undergo a medical exam.
  • The insurer evaluates the application and decides on the premium rates.
  • You are notified of the approval and given the policy details.
  • It really does vary, but typically, from the few days that simplified issue policies can take to several weeks that traditionally underwritten policies could potentially take.

  • Businesses, indeed, may purchase Life Insurance on key persons, or in a partnership, on each partner for the purpose of ensuring business continuity should the business have to be liquidated due to the death of an owner. 

  • This can vary considerably but average costs could range from $20 to several hundred dollars a month, depending on a number of factors.

  • These might vary considerably, but average prices could fall between $20 and hundreds of dollars a month, depending on lots of factors.

  • Life Insurance is usually called for once you have dependents, or should you be in large debt. The younger and much healthier you will be when you buy it, the premiums will probably be more affordable.

  • It is usually cheaper to pay annually because insurers often charge extra fees for the convenience of monthly payments.

  • Most insurers set their upper age limits at 60 or 85 for new policies, depending on the policy type and insurer. In contrast, Permanent Life Insurance has a higher age limit for new applicants.

  • It depends on the type of insurance: whether Term Life or Permanent Life. It will depend on your financial objectives, the need for coverage, and the duration of necessity. Term life applies to time-bound limited financial liability, while Permanent Life applies to financial liabilities that are best taken care of for lifelong times of protection and carry an investment element.
  • Yes, under certain circumstances, Life Insurance is considered a cost of doing business. For example, premiums on policies of life may be deductible as a cost of doing business in case the company takes out a policy on the life of any employee who is a key to the business.

    However, the benefit payout to the company on maturity of the policy or the death of the insured may not be tax-free. Specific advice in relation to your circumstances should be obtained from a suitably qualified tax professional.

  • All Life Insurance policies—specifically those that have a cash value element, such as Whole Life or Universal Life Insurance—typically offer that chance as an option. Normally, this is allowed by the lenders since the policy comes with tangible cash value.
  • Yes, the insurance firm might ask for your medical records during their underwriting. They do utilize it in health assessment and in the decision for the level of risk corresponding to your premium rates. Generally, access to these records is to be granted after you give your consent.

  • Whether you have a preference for Term Life Insurance or the lifetime protection of Permanent Life Insurance, such as Whole or Universal Life, it has to meet your needs and financial goals.

    Term Life is recommended for a person needing cheaper coverage for only some definite period, whereas Permanent Life Insurance is best sought by those who are looking for lifelong coverage with some investment laid on it.

  • In general, for Permanent Life Insurance Policies—Whole Life, Universal Life, and the various types of Variable and Indexed Life Insurance products—you can borrow against the policy’s value. The policies develop cash value over time, and borrowing against them may usually occur with interest rates offered at a discount compared with more traditional loans.

  • Life assurance policies will mature at the end of their term for term insurance or when the policies reach an age of 95 or 100 years for the insured person, according to the terms often set under Permanent Life Insurance.

    In the case of Permanent Policy where maturity benefit exists, the policy may pay the death benefit when it matures to the insured.

  • Generally, the Life Insurance may not be paid if the policyholder has been fraudulent or failed to disclose material facts. The death may also not ensue under circumstances that are excluded if death ensues (for instance, suicide within the first two years of the policy). Policies contain specific exclusions spelled out in the contract.
  • Permanent Life Insurance might not literally be an investment; it actually includes a growing cash value over time, which can be borrowed against. It provides financial protection that might offer the possibility of letting loved ones be taken care of in the event of your passing and peace.
  • Yes, Life Insurance policies will generally pay out for cancer, provided the policy was in effect before the diagnosis. Disclosure of pre-existing conditions is crucial at the time of application; failing to do so can lead to denial of a claim. 

  • Yes, Life Insurance usually does pay out for liver failure because the onset of the disease or illness is after the policy has been put into force. It’s important to disclose any pre-existing liver issues when applying for insurance to ensure coverage.