The Best Life Insurance Providers in Canada for 2021
When it comes to life insurance, many young adults throw the topic to the wind entirely, and probably with good reason. It's meticulous, stressful, but, most of all, important.
Sure, you might already own various insurance products, like auto, renters, travelers, and credit cards, but life insurance needs to be a part of the conversation. After all, we are constantly growing, which means so are our priorities.
But you're here! And that’s already a leap in the right direction.
In this Wealth Rocket guide, we'll list the best life insurance providers in Canada and provide further information on life insurance basics, including what it is, how it works, practical terms, and how to choose a suitable policy that protects you and your loved ones.
The Best Life Insurance in Canada for 2021
If you’ve ever watched a hockey game, driven on a highway, or walked around in your city or town, chances are you’re already familiar with some of Canada’s most reputable life insurance providers.
Life insurance policies are generally made available through these providers and are also available through major banks, independent financial institutions, or independent insurance firms.
However, it’s important to consider that everyone’s life is unique, which makes their life insurance policy unique as well.
Below, you’ll find the best life insurance providers in Canada, listed in alphabetical order.
1. Canada Life
Canada Life is an insurance provider currently based in Winnipeg, Manitoba. They have been in business since 1847 and are Canada’s first official life insurance provider.
Canada Life offers various types of insurance, but two common types of life insurance include:
Term Life Insurance: The term life insurance package provided by Canada Life offers Canadians the option of insuring themselves for 10, 20, or 30-year terms, or until the age of 65. The package also comes with customizable packages and the ability to change your policy with certain conditions.
Permanent Life Insurance: Permanent Life Insurance with Canada Life comes with no fixed term. It allows you to withdraw cash, within limitations, and also earn interest. The premium which you pay stays the same. A Universal Life Insurance policy is also available under the Permanent package, which allows a fluctuating interest return, similar to some types of investments.
Additional insurance policies with Canada Life include health insurance, which covers critical illnesses, disability, health expenses, and dental. If you own a business with employees, Canada Life also offers group benefits options.
Canada Life also offers investing and savings solutions, retirement planning, and mortgages.
2. The Co-operators
Founded by a group of Saskatchewanian farmers in 1945, the Co-operators are among the most reputable and best life insurance providers in Canada. Their headquarters is currently in Guelph, Ontario.
The Co-operators offer health insurance, car insurance, home insurance, business insurance, travel insurance, and life insurance. If you happen to be a proud farmer, they've got you covered with farm insurance as well.
Life insurance options are available in termed or permanent policies, with various policies within those policies.
Term life insurance comes in two packages: Term Life 1 and Versatile Term.
The Term 1 Life option comes with $50,000 to $475,000 in coverage, with a one year guaranteed renewable term.
The Versatile Term option comes with various renewable policy options that guarantee the premium for the entire term.
Permanent Life Insurance comes with many more options for those seeking lifelong insurance policies. Packages include Whole Life Suite, Universal Life Suite, Infinity Term, and the Responsibility and Responsibility PLUS® Life options.
Here's a brief rundown of each of these policies:
- Whole Life Suite: A premium life insurance policy that offers guaranteed premiums and the ability to earn dividends. It also includes funeral costs, estate settlement costs, debt-repayment, and any additional financial needs.
- Universal Life Suite: A premium policy that ensures your wealth, grants interest, and covers you and your benefactors should you pass away with a death benefit. It also offers an option to lower your monthly premium when you may need to lower your monthly expenses.
- Infinity Term: A permanent insurance place without the savings option that comes with Universal Life Suite.
- Responsibility and Responsibility PLUS Life: A permanent insurance plan ideal for insurance owners between 40 and 80 or those on a fixed retirement income.
If you’ve ever visited beautiful Quebec, you’re likely familiar with Dejardins. Though it made its historic debut in 1900 as Canada’s first credit union, it has since evolved into a full-fledged financial service and insurance provider.Today, Dejardins life insurance tiers are available as termed, permanent, participating, and universal insurance. Health insurance options by Desjardins includes coverage of critical illness, disability, healthcare, and accidents. Quotes for life insurance with Dejardins vary depending on the person purchasing the insurance.
However, terms and coverage with Desjardins range from 10 years, 20 years, or 30 years, with coverage available until 65.
Permanent coverage options are also available.
Empire is a Kingston, Ontario-based insurance company. Empire has operated since 1923, first going into business in Toronto, Ontario.
Empire specializes in providing insurance, including life, and also offers a variety of additional investing options.
Out of Canada's best life insurance providers, Empire probably leans towards the most simplified, offering life insurance term and permanent options, with 10, 20, 25, 30, and 100-year term options available.
There is also the Guaranteed Life Protect, a group insurance option that allows business owners to provide insurance for their employees.
5. iA FInancial Group
iA Financial Group is a Toronto, Ontario-based insurance firm.
Their major focus of products includes insurance, savings and retirement solutions, and loans. Various types of insurance are offered, including home, mortgage, auto, and life insurance.
In terms of life insurance, iA Financial Group offers four types of life insurance.
- Term Life Insurance: Term life insurance comes with affordable coverage. This plan provides temporary coverage designed to meet needs or if you could use the money in your monthly budget more effectively on otherexpenses.
- Permanent life insurance: The Permanent Life Insurance package offers life insurance for those who want to leave their dependants a legacy. This life insurance package also offers protection if the insurance holder's health should change and ensures their business's continuity, should they own one.
- Participating Life Insurance: Participating Life Insurance acts as an insurance policy that allows those to leave a large sum of money to their beneficiaries, including children and grandchildren. It also provides insurance for business owners seeking coverage that earns interest.
- Universal Life Insurance: With a higher premium comes higher coverage. The Universal Life Insurance policy with iA Life Insurance provides a higher inheritance for your dependents. It is suitable for those who have maximized their contributions to their RRSP and TFSAs. It also provides the business protection illustrated in the two previous policy coverages.
Manulife is an insurance provider and independent financial service provider headquartered in Toronto, Ontario. Its operations have existed since 1887. Currently, Manulife Financial is the largest provider of insurance in Canada. Manulife offers various types of life insurance, all of which come with the flexibility that makes the insurance provider suitable for everyone.
- CoverMe Term: Manulife's CoverMe life insurance package provides flexible term life insurance. Coverage offers up between $100,000 to $1,000,000 for insurers between the ages of 18 to 70. It offers a 10-year term with no increases in premiums.
- Family Term: The Family Term life insurance package by Manulife offers flexibility as a focal point. The plan tailors to life's unpredictability, adapting to changes in the insurance holder's budget. The plan includes coverage between $100,000 to $20,000,000 in coverage.It comes with premium levels for 10 and 20 years or fixed plans, with coverage until the age of 65 or for an entire lifetime.
- Family Term with Vitality: The Vitality life insurance package of Manulife's Family Term insurance policy allows policyholders to save on future insurance rates and personalize their insurance policy. This insurance policy protects your beneficiaries' coverage options that cater to your age and the coverage you seek.This plan is unique as it lets the policyholder reduce their premiums when they complete education, fitness, or health-conscious activities.
- Manulife Business Term:The Manulife Business Term offers term insurance offers protection for business owners and their families. This package offers $100,000 to $20,000,000 in coverage, with termed and fixed options starting at ten years and going for an entire lifetime.This life insurance policy provides the holder with coverage, including key business protection, business collateral, and buy-sell funding, along with estate tax coverage.
7. Sun Life
Sun Life is one of the world’s largest and oldest insurance companies, opening its doors for business back in 1865 in Montreal, but has since become one of the world’s largest insurance companies, with $1 trillion under management.
- Term Life Insurance: Term Life insurance with Sun Life comes with various options, all of which are simple to use and affordable for growing families on a stricter budget. This plan is customizable, which comes in handy with young families who have needs that change more often than not. Coverage options include $50,000, $75,000, or $100,000, with monthly payments guaranteed to stay the same for the first 10 years. Various term options exist, including coverage up to 30 years in length and up to $15,000 in coverage.
- Permanent Life Insurance: Permanent Life Insurance provides coverage for the duration of the policyholder’s life. That means no expiry date on the policy. The fixed life insurance policy offers guaranteed protection, ranging from $5,000 to $10,000,000 in coverage options.
- Participating Life Insurance: Sun Life's Participating Life Insurance policy allows the insurance holder to earn interest. This insurance package is similar to the Permanent Life Insurance package but comes with different conditions and comes in three varying packages.
- Universal Life Insurance: Sun Life's Universal Life Insurance policy comes is a fixed insurance policy that meets an insurers' longer-term needs. It is considered an all-in-one insurance package and customizable, with coverage for your life, family, and business, along with interest-earning properties.
Another major player in Canadian finance, TD Bank, also offers life insurance and great financial products that the major bank offers. TD provides life insurance quotes with custom assessments, which come in Term or Fixed rates. The term package is called Term Life, while the TD Guaranteed Acceptance Life offers fixed premiums for those between the ages of 50 to 75.
What is Life Insurance?
Life insurance is a legally binding contract that acts as a safety net to protect your loved ones if you face an illness or (knock on wood) pass away. It is a policy that provides your dependants with money.
This money allows your loved ones to continue living their lives without receiving the financial burden of a lost income in the household.
It can also help cover funeral expenses and medical costs if there are any.
The life insurance policy pays the family and usually comes with tax-free and in a lump sum, depending on the policy that the insurer purchases.
How Does Life Insurance Work?
Whether it's life insurance, health insurance, auto insurance, home insurance, or any other type of insurance, insurance provides financial protection against life's unforeseeability.
When it comes to life insurance, however, people generally purchase insurance by paying a monthly fee known as a premium for a set amount of time or the duration of their entire life, through an agreement between you and the insurance company.
The contract between the insurance buyer and the insurance provider is a contract known as a policy. You are known as the policyholder.
Insurance holders pay a monthly, quarterly, or annual fee known as a premium. Premiums are different for every insurance purchaser depending on the type of insurance, their age, health, gender, and occupation.
You will pay premiums on your insurance depending on the term that you agree on. Some insurance providers will require a medical exam before receiving coverage.
Insurance companies may charge a fee known as a deductible, an upfront payment required with certain policies. When purchasing life insurance, a 10-day grace period allows the insurance purchaser to look over their contract to ensure that it meets all of their requirements.
Both the insurer and the policyholder take a risk when it comes to life insurance. The insurer takes a risk if you require an insurance payout if the amount paid in premiums is lower than the sum that they owe. The policyholder takes a risk if they never actually require the insurance payout.
Term Life Insurance vs. Permanent Life Insurance
Generally speaking, there are two insurance options available from most Canadian life insurance providers: Term Life Insurance and Permanent Life Insurance.
Term Life Insurance allows insurance purchasers to have a fixed-term on their insurance policy. It is a basic life insurance policy that insures the insurer. Since term life insurance policies come in terms, they require renewal. Often, term life insurance is available in decade terms.
Permanent Life Insurance is also referred to as Whole Life Insurance, does not come with a fixed term and is available for the duration of your life. It also provides an investment or cash value that you can borrow or use as retirement income. Note that since the duration of the term is permanent, the premium which you pay is higher.
What is Health Insurance?
Health insurance helps cover insurance expenses that are not typically covered by provincial health care, including dental, vision, prescription fulfillment, medical equipment, travel-related health expenses, and practitioners, among other expenses.
Health insurance can also provide you with illness insurance in the event you're not able to work. Health insurance is usually a good option for those who are self-employed.
What factors determine life and health insurance rates?Several factors can impact how much you will have to pay in life and health insurance premiums. It can differ from one insurance provider to another and the life insurance packages that they provide. It also depends on the amount of coverage that you're seeking. Typically, a life insurance premium depends on the customer's age, gender, and whether they are a smoker or not.
Why do you need Life Insurance?
Simply put, life is unpredictable. Chances are, life has probably thrown you a few curveballs already. That said, insurance is essential if anyone depends on you for income.
For example, if you are married and have a mortgage, life insurance can leave your partner with money to continue paying that mortgage or any other debts. If your partner should pass away, you would receive life insurance in their absence. It sounds grim, but the first-to-die benefit is in place with many life insurance policies. There are also joint insurance policies for these types of scenarios.
If you have children, they can receive the life insurance payout and use it for their education or any other needs that they may have.
Frequently Asked Questions
Insurance rates are not only different in provinces but different around the world! Considering that life circumstances are different all over Canada, insurance rates are too.
For example, let's shift from life insurance and look at home insurance. Residents that own homes in British Columbia are more susceptible to earthquakes. On the other hand, residents who own homes in Ontario are more susceptible to flooding. Thus, insurance rates are different in different places due to different circumstances.
At the end of the day, what rate you pay on your life insurance depends on the provider.
Post-secondary students who do not have insurance may reap the benefits of health insurance and life insurance. However, many secondary students can likely claim health benefits through their parents if they are under 24 or through tuition.
Many universities and colleges typically offer health insurance through tuition. If you do not have insurance through a parent, you’ll likely have coverage through your school for health benefits.
When it comes to life insurance, students should consider life insurance nonetheless. If you are a post-secondary student who has co-signed a student loan through a bank with a parent and you should pass away, your parent may be responsible for that student loan or any other expenses.
By now, we’re all too familiar with the fact that life is unpredictable. So, even if you’re young and healthy, it’s never a bad idea to have a failsafe.
Even though young people need insurance less than anyone. However, if you live with or have a family of your own, it is a good idea to pay the low monthly premium to ensure that they're taken care of should you pass away. That said, it's never a bad idea to pay a few bucks a month to get life insurance.