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The average cost of life Insurance premiums in Canada

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The average cost of life Insurance premiums in Canada

By Ismael Girard
Published March 16, 2022 • 11 minutes

Family
family

In Canada, the average cost of a life insurance policy is $500 per year. This is a relatively small price to pay for peace of mind in knowing that your loved ones will be taken care of financially if something happens to you. However, the cost of life insurance depends on a number of factors, including your age, health, and lifestyle. In this article, we will explore what is life insurance, what should it cost you, and we will provide tips on how you can save money on your policy.

Key Takeaways

•The cost of life insurance in Canada varies depending on a number of factors, including age, health, lifestyle and gender.

• The benefits of having life insurance include providing peace of mind, covering funeral costs, paying off debts and other expenses, and giving survivors financial security.

• There are two main types of life insurance policies: term life insurance and permanent life insurance. Term life is only for a specific period of time while permanent lasts until you die as long as premiums are paid.

• To determine how much coverage you need, consider your age, health status, debt level and whether or not you have any dependents.

What is life insurance and why do you need it?

Life insurance is a contract between an insurance company and an individual that provides a lump-sum payment to the beneficiaries of the policyholder upon her/his death. The purpose of life insurance is to provide financial security for your loved ones in the event that you die prematurely. It can be very costly to take care of your loved ones financially after you die, and life insurance can help alleviate some of that burden. That's why it's important to consider life insurance if you have anyone who depends on you financially.

How much does life insurance cost in Canada?

The expense of the policy is determined by a person's personal circumstances, such as age and health. For example, a 30-year-old healthy individual might pay far less than $15 per month for a 10-year insurance plan worth $100,000. A 60-year-old smoker may pay more than $100 per month for the same coverage. Find out your life insurance price by getting your quote within 5 minutes.

Factors that affect your life insurance price

The cost of life insurance can vary depending on a number of factors, including your age, health, lifestyle and health family history. In general, the cost of your life insurance premium increases as you get older because of your risk of death. Here are the different factors and how they interact with the cost of your life insurance:

  • Age: The older you are, the higher your premiums will be, because you are at a greater risk of dying.
  • Health: The healthier you are, the lower your premiums will be. This is because insurance companies see people with healthier lifestyles as being less of a risk.
  • Lifestyle: Your lifestyle can also affect your premiums. People who engage in dangerous activities, such as skydiving or rock climbing, will pay more for life insurance than those who don't. Smokers will also pay more for life insurance than non-smokers because they are at a greater risk of developing health problems.
  • Gender: Women typically pay less for life insurance than men, because they have a higher life expectancy.
  • Coverage amount: The greater the coverage amount, the higher your premiums will be.
  • Policy length: The longer the policy length, the higher your premiums will be.

Life insurance quote simulator

You can use our life insurance quote simulator to get an idea of how much your premiums will be. Simply enter your date of birth, whether you are a smoker or non-smoker, and the amount of life insurance you would like to obtain.

Block -> Obviously, this won't give you your exact price. To find out the exact price of your coverage, you'll have to calculate your needs with our life insurance calculator.

5 Tips to help you save money on life insurance

How to save money
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There are many factors to consider when purchasing a life insurance policy. Here are the 5 best tips to help you save money on your next life insurance policy:

1. Compare rates

Get quotes from several different insurance companies to find the best deal.

2. Bundle policies

Many insurers offer discounts if you purchase multiple policies, such as home and auto insurance, from them.

3. Quit smoking

Smokers pay more for life insurance than non-smokers, so quitting smoking can save you a lot of money.

4. Choose a shorter policy

If you don't need coverage for the rest of your life, consider purchasing a shorter policy. This will reduce your premiums significantly.

5. Get healthy

To give you the best chances at getting the lowest premiums possible, you should consider making healthy lifestyle choices, if you aren't already doing it.

The benefits of having life insurance

It's important to have life insurance, even if you think you can't afford it. Here are some of the benefits of having life insurance:

It provides peace of mind: The peace of mind that comes with knowing you have life insurance is invaluable. Knowing that your loved ones will be taken care of financially if something happens to you is a great feeling, and can provide much-needed comfort in difficult times.

It can help cover funeral costs: The average funeral in Canada costs more than $6,000. This can be a burden for your loved ones, especially if they are already dealing with the loss of a loved one. Having life insurance can help cover the costs of your funeral, so your loved ones don't have to worry about that added stress.

It can help pay off debts and other expenses: Debts and other expenses can be a major burden for your loved ones if you die. That's why life insurance is so important — it can help them pay off any outstanding debts and other expenses, so they can focus on grieving and moving on.

It gives survivors financial security: Survivors of someone who dies without life insurance may have to face significant financial challenges. A life insurance policy can provide much-needed security for them during a difficult time.

Term life insurance vs permanent life insurance

When it comes to life insurance, there are two main types of policies: term life insurance and permanent life. Here's a quick overview of the differences between the two life insurance products:

Term life insurance is only for a specific period of time, usually 10 or 20 years. After that period expires, you need to renew or cancel your policy. If you don't renew, your policy will no longer be in effect and your beneficiaries will not receive any benefits. Here are the pros of term life insurance policies:

  • It's affordable: Term life insurance rates are relatively affordable, especially when compared to permanent life insurance.
  • It has a high coverage amount: The maximum coverage amount for most term life policies is $1 000 000.

Permanent life insurance lasts until you die, as long as premiums are paid. This type of policy has many different features, here are the two main ones:

  • Cash value: Permanent life insurance policies will have a cash value, which grows over time. You can access the cash value in your policy by withdrawing money, borrowing against it, or cashing it in.
  • Death benefit: The death benefit is the amount of money that your beneficiaries will receive if you die while your policy is still in effect. With a permanent life insurance policy, this amount will be greater than the premiums you paid, and the cash value will be subtracted from it.

How much life insurance coverage do you need?

This is a difficult question to answer, as it depends on many factors, such as your age, health, and lifestyle. However, here are some general guidelines to help you determine how much life insurance coverage you need:

If you have young children, you should have enough coverage to cover their expenses until they reach adulthood. This could include things like education costs, living expenses, and future inheritance.

If you have elderly parents or other loved ones who depend on you financially, you should have enough coverage to take care of their needs if something happens to you.

If you have a lot of debt, you should have enough coverage to pay off your debts in the event of your death.

What’s the best time to purchase life insurance?

The quick answer is: now

If you're concerned that your family won't be taken care of financially if something happens to you, it's a good idea to consider getting life insurance as soon as possible

Young people generally have fewer health problems than older adults, so they'll likely pay lower premiums. If you are healthy and don't smoke, for example, your premiums may be lower. So it's probably time to consider signing up for life insurance.

What happens if you don't have enough coverage?

In the unfortunate event of your death, if your family doesn't have enough money to cover your expenses, they will likely have to rely on the government for help. This is why having life insurance is so important, as it can help take care of your loved ones financially in case something happens to you.

However, if you don't have enough coverage, your family can find themselves in trouble. This is especially true if you don't have savings or assets they can access. So it's important to make sure you have enough life insurance to cover your needs.

Real-life examples: Cost of life insurance

Josh and Mia live in Oakville, Ontario. They may have student loan debt, like many other millennials, but they also juggle other financial obligations, such as their mortgage.

Josh and Mia
family

As they start to think about building a family, they realize how important it is to get a life insurance policy. They want to make sure that if something happens to them, their children will be financially secure.

Because he’s both a man and a smoker, Josh's premiums are quoted as being over double the rate compared to Mia's. Even so, the couple was surprised at how affordable life insurance actually is. In fact, their monthly premiums will be less than their cell phone bill!

  • Josh's approximate premium: $32.31*
  • Mia's approximate premium: $13.23*

*These premiums are based on Emma rates

Block -> Since they’re still young, they know that their premiums will be lower now than if they wait, and it’s best to lock in those rates.

They also understand that, given their current mortgage debt, they will not require the same $400,000 coverage amount in 10-20 years. This should assist them to lower the premium for their new policy term and keep it affordable for their family.

Final thoughts

It is important for everyone to have some form of life insurance — whether you are a mom, a dad, or even a young adult just starting out in your career you need to protect your loved ones financially if something happens to you.

The cost of life insurance premiums can vary depending on a variety of factors, such as your age, health, and lifestyle. That's why it's important to speak with an insurance advisor about the best policy for you.

At Emma, we want to make sure that you get the best rates for the coverage that you need. Sign up today and get advices from our team of experts.

FAQ

What is the average cost of life insurance in 2022?

If you're a healthy 30-year-old looking for a 10-year term life insurance policy, the average cost of monthly premiums is around $13 for $100,000 in coverage.

Life insurance does not have to be expensive. 44% of Canadians believe life insurance is affordable. That's why it's our goal to make it accessible at the most affordable price.

Is 100 000 A good life insurance enough?

A 100,000 dollar life insurance policy is a good amount of coverage for most people. It would provide financial security for your loved ones if something happened to you and you were no longer able to provide for them. However, most people don't actually know how to calculate their needs. That is why our online life insurance needs calculator makes it easier for you to make a decision. Create your account and calculate your needs in just under 3 minutes.

What is better, term or whole life?

Term life insurance is better for most people. It is the most affordable and provides coverage for a specific period of time. If something happens to you during that time, your loved ones will receive a payout from the insurance policy.

Whole life insurance is more expensive but it does not expire. Some companies also offer a cash value that builds over time. This could be a good option for someone who wants coverage for their entire life.

Do I need to get a medical exam to get life insurance?

Some life insurance companies, like Emma, offer instant approval. We don’t require any medical exams. All you have to do is answer our health quiz, and you'll be good to go!

How much is life insurance for a single person?

A $250,000 term life insurance policy will cost an average of $14 per month for a 30-year-old man and $11 for a woman.

What is the cost of a one-million-dollar life insurance policy in Canada?

$1 000 000 term life insurance policy will cost $34,66 per month for a 30-year-old, non-smoking male with Emma. For a 30-year-old non-smoking female, the cost of the term life insurance will be about $22,95 per month at Emma. 

What's the cheapest life insurance company?

The cheapest life insurance company is usually the one that offers the lowest premiums. However, it's important to remember that not all life insurance policies are created equal. Make sure you read the fine print before you sign up for a policy.

Last edited: March 16, 2022

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Ismael Girard, Content Marketing Coordinator, Life Insurance Agent

Ismael joined Emma as a content marketing coordinator & life insurance agent in 2021. He is an expert covering all the ins and outs of life insurance that also specializes in blog writing and email marketing.

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