How Much Is Life Insurance in Canada? (Average Rates)

How much does life insurance cost in Canada?

The cost of life insurance in Canada can range from $15 to $300+ per month. The amount it costs you will depend on personal factors and the type of policy you choose.

We’ve broken down sample life insurance quotes from some of Canada’s top-rated providers to give you a realistic idea of what you might pay. Understanding how these factors affect your premiums can help you spot a fair rate—or an overpriced one. 

All rates are based on a 35-year-old non-smoker with $500,000 in coverage for a 20-year term policy.

“The average cost of life insurance in Canada can range widely depending on your health, policy type, and premium amount.” —Erik Heidebrecht, Life Insurance Advisor

How do life insurance companies calculate premiums?

The cost of life insurance in Canada depends on factors like age, sex, health, lifestyle, and coverage amount. Some of these factors are within your control, while others are outside of it. 

Here's exactly what insurers consider when calculating your life insurance premiums:

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• Age: The risk of death goes up as you age, making it more costly for insurers to cover you.
• Sex: Women tend to live longer than men. Men will typically pay higher life insurance premiums. 
• Smoking: Smokers pay at least twice as much as non-smokers.
• Health: The poorer your health, the more you'll pay (includes pre-existing health conditions like diabetes or high blood pressure).
• Lifestyle risk factors: Engaging in risky hobbies (think skydiving and SCUBA diving) or jobs will result in higher insurance policy rates.
• Coverage amount: The more coverage you get, the higher your premiums will be.
• Type of insurance: Term life insurance is considerably more affordable than permanent life insurance policies, such as whole or universal life.
• Term length: If you opt for term life insurance, the length of your term (i.e., the period of time you’re covered) can impact the premium you’ll pay.
• Provider: Different insurance companies have different pricing structures, so it pays to shop around.

Life insurance premiums by sex

In general, women pay less for life insurance than men thanks to longer life expectancy. In Canada, women outlive men by an average of 4.4 years, according to the World Health Organization. 

Here are some sample rates to give you an idea of life insurance costs by sex. All rates are based on a non-smoker with $500,000 in coverage for a 20-year term policy.

Life insurance premiums for smokers 

Smokers pay much more for life insurance coverage because smoking is tied to serious medical issues like cancer and heart disease, which reduce life expectancy by as much as 10 years. Below are sample premiums for $500,000 in coverage for a 20-year term policy for someone who has smoked cigarettes within the last 12 months.

Be honest about smoking

Expect any life insurance company to ask you about your smoking history — and always be honest with these questions. Lying about your nicotine use on a life insurance application is considered fraud and could lead to your policy being canceled.

No longer a smoker? You'll need to be nicotine-free for at least one year to qualify as a non-smoker and secure more affordable life insurance rates.

How health affects the cost of life insurance

The healthier you are, the lower your life insurance prices will be. Some insurers require applicants to undergo a medical exam and provide a medical history and family medical history. Health conditions that may impact life insurance costs include:

• High blood pressure
• High cholesterol
• Obesity
• Heart disease
• Cancer
• HIV
• Diabetes

Rates will vary based on the severity of your health condition. For example, someone who is under the age of 40 with type 2 diabetes would likely be declined for coverage. Someone with the same condition but over the age of 40 might be around 150% of the base price, depending on how well the diabetes is being managed.

If you have been denied coverage or have a pre-existing condition, you can apply for no-medical life insurance products, some of which approve you instantly without a medical exam. But these policies are much more expensive—sometimes three times as much as a term policy with traditional underwriting. 

If you have a pre-existing condition or a family history of medical issues, buy life insurance as soon as possible as this will help you lock in the lowest rate. Prices only increase the older you get.

How high-risk activities affect the cost of life insurance

You may pay more for life insurance if you like to live life on the edge. High-risk hobbies like skydiving and SCUBA diving increase the risk factor of covering you.

On top of this, insurers may review criminal history and motor vehicle reports to see how risky you are to insure. Driving violations or criminal convictions can affect your monthly price or result in a denied application, but each insurer has its own rules.

Here's where the math gets complicated. Your life insurance premiums are calculated with standard industry ratings, from A to J or 1 to 10, with 1 being the most ideal and 10 being the riskiest. If you engage in a few high-risk hobbies and your life insurance company places you in the "C" rating class, you could expect to pay about 75% more for life insurance.

Average cost of life insurance by coverage amount

Your life insurance coverage amount represents the lump sum death benefit payout that your beneficiaries would receive upon your death. The higher your coverage amount, the higher your life insurance premiums will be.

Here are sample premiums for coverage amounts from $100,000 to $1,000,000 for a 20-year term life policy for a 35-year-old non-smoking applicant:

Average cost of term life insurance

Term life insurance covers you when you need it most, like when your kids are young or you’re still paying off your mortgage and other debts. But most Canadians will reach a point where they’re debt-free and without dependents. That’s why term life only covers a certain number of years, allowing you to stop paying premiums once your insurance needs end. 

The shorter the policy length, or “term,” the more affordable the life insurance premium will be. Most term life insurance options are "level term,” which means policyholder premiums stay the same across the entire term. 

Here’s how PolicyMe prices different term lengths for a 35-year-old, non-smoking applicant with $500,000 in term coverage:

Average cost of whole life insurance

Unlike term life insurance, whole life insurance lasts for your entire life — not just a limited policy term. This means a guaranteed death benefit for your loved ones (as long as you keep up with your premiums), but it also makes whole life coverage significantly more expensive.

On average, whole life insurance costs 5-15x more than term life insurance. The exact cost can vary depending on your age, health, and coverage amount, along with other factors such as the carrier you’re working with. 

The premiums below are based on publicly available starting rates for $500,000 in coverage for a relatively healthy 35-year-old applicant.

Whole vs. permanent life insurance

Whole life insurance is just one type of permanent life insurance policy. Other permanent life insurance options include universal life insurance, which has variable premiums in addition to a cash value component, and participating life insurance, which pays dividends based on the insurer’s financial performance.

Average cost of life insurance for couples

Joint life insurance is a single policy that covers two people under one monthly premium. These policies are often cheaper than buying two separate permanent insurance policies. 

That said, there is always the option for couples to purchase individual policies to choose their own lengths and coverage amounts. While this can sometimes be pricier than buying one joint life insurance policy, it's much more flexible and may be a better match for your actual financial needs. 

PolicyMe offers the best of both worlds: Couples can buy their own policies and get a discount in their first year when they apply together.

Average cost of life insurance for seniors

Senior life insurance is often used for funeral expenses, estate planning, and supporting your beneficiaries once you have passed.

It's still very much possible to get good coverage when you're older, but life insurance rates do go up as you age. That said, since you may have less debt or fewer financial obligations, you can purchase a policy with lower coverage amounts to offset costs.

Here are PolicyMe term life insurance rates for $100,000 in coverage over a 10-year term:

How much life insurance can I get for $50?

Many people go into the process of shopping for life insurance with a budget in mind. To get you started, we’ve pulled your options for term policies for a premium rate of around $50 per month or less from PolicyMe.

Life insurance options for $50 at 25

• Non-smoking female: Up to $2.5M in coverage for a 10-year term or $1M in coverage for a 20- to 30-year term
• Non-smoking male: Up to $2M in coverage for a 10-year term, $1M in coverage for a 20-year term, or $700K in coverage for a 30-year term
• Smoking female: Up to $950K in coverage for a 10-year term, $900K in coverage for a 20-year term, or $550K in coverage for a 30-year term
• Smoking male: Up to $650K in coverage for a 10-year term, $500K in coverage for a 20-year term, or $350K in coverage for a 30-year term

Life insurance options for $50 at 35

• Non-smoking female: Up to $2M in coverage for a 10-year term, $1M in coverage for a 20-year term, or $600K in coverage for a 30-year term
• Non-smoking male: Up to $1M in coverage for a 10- or 20-year term or $400K in coverage for a $30-year term
• Smoking female: Up 40 $800K in coverage for a 10-year term, $400K in coverage for a 20-year term, or $250K in coverage for a 30-year term
• Smoking male: Up to $550K in coverage for a 10-year term, $300K in coverage for a 20-year term, or $150K in coverage for a 30-year term

Life insurance options for $50 at 45

• Non-smoking female: Up to $1M in coverage for a 10-year term or $500K for a 20-year term 
• Non-smoking male: Up to $650K in coverage for a 10-year term or $300K in coverage for a 20-year term 
• Smoking female: Up to $300K in coverage for a 10-year term or $150K for a 20-year term
• Smoking male: Up to $150K in coverage for a 10-year term or $100K in coverage for a 20-year term

Life insurance options for $50 at 55

• Non-smoking female: Up to $300K in coverage for a 10-year term or $100K in coverage for a 20-year term
• Non-smoking male: Up to $200K in coverage for a 10-year term or $100K in coverage for a 15-year term 
• Smoking female: Up to $100K in coverage for a 10-year term
• Smoking male: No options under $50/month

8 ways to save money on your life insurance premiums

Generally speaking, term life insurance is very affordable. If you want to get the most financial security for your money, here are some tips:

1. Buy early: It's best to purchase life insurance when you're younger to lock in a lower price, since your rates will increase each year.
2. Shop around: Get quotes from various life insurance companies to compare and find the best deal.
3. Consider a term life insurance policy: One of the easiest ways to save money is to buy a term policy. Permanent insurance policies last your entire life but are much more costly.
4. Bundle your policy: Some insurers offer a discount when you bundle your life insurance policy with other types of insurance, like critical illness or disability insurance.
5. Look for discounts: Some companies offer discounts if you apply as a couple. PolicyMe offers 10% off the monthly cost of life insurance in the first year when you apply together.
6. Maintain a healthy lifestyle: Stay in good health by managing your weight, not smoking, and avoiding high-risk activities.
7. Don't skip the medical exam: If you don't have pre-existing medical conditions, stay away from pricey no-medical policies.
8. Choose your coverage carefully: You don’t need to purchase more coverage than necessary—and you can always adjust the death benefit or length of your policy if your situation changes.

Video summary: How much does life insurance cost in Canada?

Next steps: ready to start looking for life insurance?   

• Assess your financial situation, including loved ones that you support or other obligations you have, like mortgage or education costs.
• Determine how much life insurance coverage you need. Many people underestimate how much coverage they should get.
• Use an online life insurance calculator to find the right amount of coverage for your situation.
• Decide which type of policy is right for you. Term life insurance is typically the best option for most families, though it depends on your personal situation.
• Understand the factors that affect your life insurance premiums, including your health and lifestyle.
• Shop around and compare rates from different insurers to find the best option for you.

See just how much you can save on life insurance with PolicyMe.

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FAQ: Life insurance cost Canada

How does inflation impact life insurance cost?

Inflation doesn't usually impact the cost of life insurance if you already have a policy. You may experience higher life insurance premiums if you're shopping for a new policy or renewing your policy.

Inflation drives up costs, making things pricier over time. It also impacts interest rates, which means higher returns on investments like bonds, savings accounts, and some insurance policies, like permanent policies. This means your cash value may go up, but the purchasing power of your death benefit may be lower.

Is $100 a month a lot for life insurance?

The life insurance rate of $100 is quite a hefty number for life insurance coverage — but that number is relative. If you're a senior with pre-existing conditions, you might consider that a good deal! If you're a 25-year-old non-smoker, you might consider that way too much.

In addition to that, it also depends on the type of life insurance you're getting a quote for. It might be a good price for whole life insurance or no medical life insurance, and might be too high a price for term life insurance.

What are life insurance premiums?

A life insurance premium is the amount of money paid by the policyholder to the insurance company to get covered. Premiums are most commonly paid on a monthly basis, but some companies allow for annual payments instead.

Life insurance premiums are calculated at the time of the policyholder's application and are based on various factors, like the type of life insurance product, the age, gender, smoking status and health of the policyholder i.e. the likelihood of claims being made.

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The prices listed in this article have been researched and fact-checked with both internal and external sources. Prices are based on publicly available rates.

^{*Starting prices based on $500,000 coverage for a 40-year-old.}

^{**Average prices based on a 20-year term policy for $250,000 coverage.}

^{***Starting prices based on a 20-year term policy for $250,000 coverage for a 65-year-old.}

Additional sources:

1. WinQuote Canadian Products. WinQuote by Equisoft. https://www.winquote.net/

2. Hobbs, S., Director of Policy at Canadian Life and health insurance Association. Interview conducted by Hanna Horvath.

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PolicyMe Editorial Team

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Our mission is to empower Canadians to make informed financial decisions. To achieve this, we have an expert editorial team that includes licensed insurance advisors and financial planners. We prioritize the best interests of Canadian families and won't endorse any product, company or financial strategy that we believe isn't suitable. Our educational guides are crafted by in-house experts, like licensed life insurance advisors. Before publication, we subject our research and advice to scrutiny and comprehensive revisions for accuracy and completeness.

Our mission is to empower Canadians to make informed financial decisions. To achieve this, we have an expert editorial team that includes licensed insurance advisors and financial planners. We prioritize the best interests of Canadian families and won't endorse any product, company or financial strategy that we believe isn't suitable. Our educational guides are crafted by in-house experts, like licensed life insurance advisors. Before publication, we subject our research and advice to scrutiny and comprehensive revisions for accuracy and completeness.