Term life insurance is a type of life insurance policy that provides coverage for a set period of time, typically ranging from 5-30 years. If the policyholder passes away during the term of the policy, the death benefit is paid out to the beneficiaries named in the policy.

In Canada, term life insurance policies can be purchased in varying coverage amounts and term lengths, and may offer the option to renew or convert the policy at the end of the term. Term life insurance policies typically have lower premiums compared to permanent life insurance policies, which offer coverage for the policyholder’s entire lifetime.

Unlike permanent life insurance policies, term life insurance policies do not have a cash value component and do not accumulate any savings or investment value. However, they can provide affordable coverage for individuals who need life insurance for a specific period of time, such as to provide financial support for children or to pay off a mortgage.

Term Life Insurance Pros

Here are some potential benefits of term life insurance:

1. Affordability: Term life insurance policies generally have lower premiums compared to permanent life insurance policies, which can make them an affordable option for individuals who need life insurance coverage.
2. Flexibility: Term life insurance policies offer a range of coverage amounts and term lengths, so individuals can select a policy that meets their specific needs.
3. Simplicity: Term life insurance policies are generally straightforward and easy to understand, with no complicated investment or savings features.
4. Temporary coverage: Term life insurance policies provide coverage for a specific period of time, such as while children are young or a mortgage is being paid off. This can be a cost-effective way to provide the necessary coverage for a certain period of time.
5. Convertibility: Many term life insurance policies offer the option to convert to a permanent life insurance policy at the end of the term. This can provide flexibility for individuals who may need longer-term coverage in the future.

It’s important to review the terms and conditions of the policy carefully to understand any restrictions or limitations on coverage, waiting periods, and premium payments. Additionally, working with a licensed insurance professional can help you find the best term life insurance policy for your specific needs and budget.

Term Life Insurance Cons

Here are some potential drawbacks of term life insurance:

1. Coverage may expire: Term life insurance policies provide coverage for a specific period of time, and if the policyholder outlives the term, the policy will expire and there will be no death benefit paid out.
2. No cash value: Unlike permanent life insurance policies, term life insurance policies do not have a cash value component and do not accumulate any savings or investment value.
3. Renewal may be costly: If the policyholder wants to renew the policy at the end of the term, the premiums may be significantly higher, especially if the policyholder has aged or experienced changes in health status.
4. No investment benefits: Term life insurance policies do not offer any investment benefits or allow policyholders to accumulate cash value.
5. No permanent coverage: Term life insurance policies only offer temporary coverage, and do not provide coverage for the policyholder’s entire lifetime.
6. May require a medical exam: Depending on the policy, some term life insurance policies may require a medical exam, which can be a barrier for individuals with health issues.

It’s important to review the terms and conditions of the policy carefully to understand any restrictions or limitations on coverage, waiting periods, and premium payments. Additionally, working with a licensed insurance professional can help you find the best term life insurance policy for your specific needs and budget.

Term Life Insurance Cost in Canada

The cost of term life insurance can vary based on several factors, including the coverage amount, term length, and the policyholder’s age and health status. Here are some average term life insurance costs for a non-smoking, 35-year-old male for a 20-year term, broken down by province. Please note that these are just example quotes, and individual rates may vary based on your specific circumstances.

• Ontario: $22 per month for $500,000 in coverage
• Quebec: $18 per month for $500,000 in coverage
• British Columbia: $22 per month for $500,000 in coverage
• Alberta: $23 per month for $500,000 in coverage
• Manitoba: $21 per month for $500,000 in coverage
• Saskatchewan: $20 per month for $500,000 in coverage
• Nova Scotia: $21 per month for $500,000 in coverage
• New Brunswick: $20 per month for $500,000 in coverage
• Newfoundland and Labrador: $21 per month for $500,000 in coverage
• Prince Edward Island: $21 per month for $500,000 in coverage
• Yukon: $22 per month for $500,000 in coverage
• Northwest Territories: $22 per month for $500,000 in coverage
• Nunavut: $23 per month for $500,000 in coverage

Please note that these quotes are for illustrative purposes only and are based on a single set of criteria. Actual quotes may vary based on the individual’s specific circumstances and the insurance company’s underwriting guidelines. It’s important to shop around and compare policies from several different insurers to find the best value. Working with a licensed insurance professional can also help you find the best policy for your specific needs and budget.

Term Life Insurance Common Questions Insurers Ask

Here are some common questions that insurers may ask when you are applying for a term life insurance policy:

1. What is your age?
2. What is your gender?
3. What is your height and weight?
4. Do you smoke or use tobacco products?
5. Have you ever been diagnosed with any medical conditions or diseases?
6. Have you ever been hospitalized or had surgery?
7. Are you taking any prescription medications?
8. Have you ever been declined for life insurance coverage?
9. What is the desired coverage amount?
10. What is the desired term length?
11. What is the purpose of the coverage?
12. Who would be the beneficiary of the policy?
13. Are you a Canadian citizen or permanent resident?
14. Have you traveled outside of Canada in the past 2 years?
15. Have you engaged in any hazardous activities or extreme sports?
16. Have you ever been convicted of a criminal offense?
17. Have you declared bankruptcy in the past 5 years?
18. Have you ever been involved in a motor vehicle accident or received a driving violation?
19. What is your occupation and job title?
20. What is your annual income?
21. Are you covered by any other life insurance policies?
22. Have you made any recent changes to your health or lifestyle?
23. Have you ever been treated for mental health conditions?
24. Do you have any immediate family members who have been diagnosed with any serious medical conditions or diseases?
25. Have you had any recent blood work or medical exams that may impact your insurability?

List of Top 10 Best Term Life Insurance Companies in Canada

Here is a list of some of the best term life insurance companies in Canada, in no particular order:

1. Manulife
2. Sun Life Financial
3. Canada Life
4. Industrial Alliance
5. Empire Life
6. Equitable Life
7. BMO Insurance
8. Desjardins Insurance
9. RBC Insurance
10. Foresters Financial

It’s important to note that the best term life insurance company for you may depend on your specific needs and circumstances, as well as the policy options and underwriting guidelines of each insurer. It’s a good idea to compare policies and rates from several different companies, and to work with a licensed insurance professional to help you find the best policy for your needs and budget.

Most common types of term life insurance plans offered by Canadian insurers

Insurance companies in Canada offer a range of term life insurance plans to meet the needs of different individuals. Here are some of the most common types of term life insurance plans offered by Canadian insurers:

1. Level term: This type of term life insurance provides coverage for a fixed term length, typically ranging from 5-30 years. The death benefit and premium payments remain the same throughout the term.
2. Decreasing term: This type of term life insurance provides coverage for a fixed term length, but the death benefit decreases over time. This type of policy is often used to cover a specific debt, such as a mortgage or a loan.
3. Renewable term: This type of term life insurance allows the policyholder to renew the policy at the end of the term without having to undergo a new medical exam or provide updated health information.
4. Convertible term: This type of term life insurance allows the policyholder to convert the policy to a permanent life insurance policy at the end of the term without having to undergo a new medical exam or provide updated health information.
5. Term-to-100: This type of term life insurance provides coverage for the policyholder’s entire life, with fixed premium payments that are guaranteed to remain the same.
6. Joint term life insurance: This type of term life insurance provides coverage for two individuals, with the death benefit paid out when either individual passes away.

It’s important to review the terms and conditions of each policy carefully to understand the coverage, premium payments, and any restrictions or limitations. Additionally, working with a licensed insurance professional can help you find the best term life insurance policy for your specific needs and budget.

Term Life Insurance Reviews

Here are some examples of term life insurance reviews from across the internet:

Good Reviews:

1. “I’ve had term life insurance with this company for several years and I have had a great experience. The premiums are affordable and the customer service is excellent.” – Review of Manulife on ConsumerAffairs
2. “I recently purchased a term life insurance policy with this company and the process was quick and easy. The premiums are reasonable and the coverage options are flexible.” – Review of Sun Life Financial on Yelp
3. “I’ve been a customer of this company for years and I’ve been very satisfied with my term life insurance policy. The premiums are affordable and the coverage is comprehensive.” – Review of Canada Life on Trustpilot
4. “I have a term life insurance policy with this company and I have had a great experience. The premiums are affordable and the coverage options are flexible. I appreciate the peace of mind that comes with having this policy.” – Review of Sun Life Financial on Trustpilot
5. “I recently purchased a term life insurance policy and I was impressed with how easy and straightforward the process was. The premiums are reasonable and the customer service has been excellent.” – Review of Industrial Alliance on BBB
6. “I have been a customer of this company for years and I have had a positive experience with my term life insurance policy. The premiums are competitive and the coverage is comprehensive. I would recommend this company to others.” – Review of BMO Insurance on ConsumerAffairs

Bad Reviews:

1. “I had a terrible experience with this company’s term life insurance policy. The premiums were high and the coverage was not what I expected. The customer service was also poor and unresponsive.” – Review of Industrial Alliance on BBB
2. “I had a negative experience with this company’s term life insurance policy. The premiums increased significantly over time and the customer service was unhelpful in resolving the issue.” – Review of Empire Life on Yelp
3. “I had a bad experience with this company’s term life insurance policy. The coverage was not sufficient and the premiums were expensive. I would not recommend this company to others.” – Review of BMO Insurance on ConsumerAffairs
4. “I had a bad experience with this company’s term life insurance policy. The premiums increased significantly over time and the coverage was not what I expected. The customer service was unhelpful in resolving the issue.” – Review of Manulife on Yelp
5. “I had a negative experience with this company’s term life insurance policy. The coverage was not sufficient and the premiums were expensive. I would not recommend this company to others.” – Review of Equitable Life on Trustpilot
6. “I had a frustrating experience with this company’s term life insurance policy. The application process was lengthy and complicated, and the customer service was not helpful in answering my questions. I ended up going with a different company.” – Review of Foresters Financial on BBB

It’s important to read a variety of reviews and to take them with a grain of salt, as individual experiences may vary. It’s also a good idea to research the specific policy options and underwriting guidelines of each insurer before making a decision on a term life insurance policy. Additionally, working with a licensed insurance professional can help you find the best policy for your specific needs and budget.

Term Life Insurance Tips

Here are some tips for purchasing a term life insurance policy:

1. Determine your coverage needs: Consider your financial obligations and dependents to determine the appropriate coverage amount and term length.
2. Shop around: Get quotes and compare policies from several different insurers to find the best value for your needs and budget.
3. Consider a medical exam: While not always required, taking a medical exam can help you get more accurate quotes and potentially lower premiums.
4. Read the policy carefully: Understand the terms and conditions of the policy, including any restrictions or limitations on coverage.
5. Work with a licensed insurance professional: A qualified insurance agent or broker can help you navigate the process of purchasing a term life insurance policy and find the best policy for your specific needs.
6. Review your policy regularly: As your life circumstances change, it’s important to review your policy regularly to ensure that your coverage is still appropriate and sufficient.
7. Choose a reputable insurer: Look for an insurer with a strong financial rating and a good reputation for customer service.
8. Consider a convertible policy: If you think you may want permanent life insurance coverage in the future, consider a convertible term life insurance policy that allows you to convert to a permanent policy without a medical exam.

By following these tips, you can find a term life insurance policy that meets your needs and provides valuable financial protection for you and your loved ones.

Term Life Insurance FAQs

Here are some frequently asked questions about term life insurance:

1. What is term life insurance?

Term life insurance is a type of life insurance that provides coverage for a fixed term length, typically ranging from 5-30 years. The policy pays out a death benefit to the beneficiary if the insured individual passes away during the term of the policy.

2. How does term life insurance differ from permanent life insurance?

Term life insurance provides coverage for a fixed term length, whereas permanent life insurance provides coverage for the insured individual’s entire life. Term life insurance also tends to be more affordable than permanent life insurance.

3. How much term life insurance coverage do I need?

The amount of coverage you need depends on your financial obligations and dependents. A general rule of thumb is to have coverage that is equal to 10-12 times your annual income.

4. How long should my term life insurance policy be?

The term length of your policy should correspond to the length of time during which your financial obligations and dependents require financial support. A common term length is 20 years.

5. Can I renew my term life insurance policy?

Some term life insurance policies are renewable, which means that you can renew the policy for another term length without having to undergo a new medical exam or provide updated health information. However, the premiums may increase upon renewal.

6. Can I convert my term life insurance policy to a permanent policy?

Some term life insurance policies are convertible, which means that you can convert the policy to a permanent life insurance policy at the end of the term without having to undergo a new medical exam or provide updated health information.

7. Do I need a medical exam to get term life insurance?

Not all term life insurance policies require a medical exam. However, taking a medical exam can help you get more accurate quotes and potentially lower premiums.

8. How much does term life insurance cost?

The cost of term life insurance depends on several factors, including the coverage amount, term length, and the policyholder’s age and health status. Generally, term life insurance tends to be more affordable than permanent life insurance.

9. How do I choose a term life insurance policy?

It’s important to consider your coverage needs, compare policies and quotes from several different insurers, and work with a licensed insurance professional to find the best policy for your specific needs and budget.

10. When does term life insurance pay out?

11. Can I name multiple beneficiaries on my term life insurance policy?

Yes, you can name multiple beneficiaries on your term life insurance policy and designate what percentage of the death benefit each beneficiary will receive.

12. Can I change my beneficiary on my term life insurance policy?

Yes, you can change your beneficiary on your term life insurance policy at any time by submitting a beneficiary change form to your insurance company.

13. What happens if I outlive my term life insurance policy?

If you outlive your term life insurance policy, the coverage will expire and you will not receive any payout. However, some insurers offer a return of premium rider that refunds the premiums you paid if you outlive the policy term.

14. Can I cancel my term life insurance policy?

Yes, you can cancel your term life insurance policy at any time. However, if you cancel the policy before the end of the term, you may not receive any premium refunds.

15. Will my term life insurance premiums increase over time?

With most term life insurance policies, the premium payments are fixed for the term length of the policy. However, some policies may include a provision that allows the insurer to increase the premiums over time.

It’s important to review the specific terms and conditions of your policy and to work with a licensed insurance professional to understand the coverage and any restrictions or limitations.

16. What happens if I miss a premium payment on my term life insurance policy?

If you miss a premium payment on your term life insurance policy, the policy may lapse or be cancelled. However, many insurers offer a grace period during which you can make up the missed payment without penalty.

17. How long does it take to get a term life insurance policy?

The time it takes to get a term life insurance policy varies depending on the insurer and the policy. Some policies can be issued within a few days, while others may take several weeks.

18. What if I have a pre-existing medical condition?

Having a pre-existing medical condition may impact your ability to get approved for a term life insurance policy or may affect the cost of your premiums. However, many insurers offer policies specifically designed for individuals with pre-existing conditions.

19. Can I get term life insurance if I’m a smoker or have a risky job?

Yes, you can still get approved for a term life insurance policy if you’re a smoker or have a risky job. However, your premiums may be higher than someone who is a non-smoker or has a less risky job.

20. What happens to my term life insurance policy if I move to a different country?

The terms and conditions of your policy may vary depending on the insurer and the policy. Some policies may have restrictions on coverage if you move to a different country. It’s important to review the terms and conditions of your policy and to contact your insurer if you’re planning on moving to a different country.

The policy pays out a death benefit to the beneficiary if the insured individual passes away during the term of the policy.