Best Term Life for Seniors in Canada | Companies & Rates

Note: All quotes have been pulled from Winquote.ca, a public source and are accurate as of 2024.

As seniors approach their golden years, the need for reliable life insurance becomes more pressing. Whether it’s to cover final expenses, leave a legacy, or provide financial security for loved ones, choosing the right term life insurance is crucial. 

For seniors, the best type of term life insurance often involves shorter term lengths, like 10 or 15 years. These shorter terms can offer more affordable premiums while providing necessary coverage for specific needs, such as paying off remaining debts or ensuring funds for final expenses. 

Policies with level premiums are particularly beneficial because they maintain consistent payment amounts throughout the term, making budgeting easier.

But  it's important to note that term life insurance is usually not recommended for seniors due to higher monthly rates. As individuals age, the risk to insurers increases, resulting in significantly higher premiums compared to younger applicants. This can make term life insurance less cost-effective for seniors, especially those on a fixed income. 

When it comes to finding the best term life insurance for seniors, a few companies stand out for their customer service, financial stability, and tailored policies.

PolicyMe is known for its straightforward, fully-online application process and competitive rates. They offer policies that are easy to understand, making it simpler for seniors to make informed decisions. PolicyMe’s term life insurance is designed to be affordable while providing necessary coverage without unnecessary frills. For a 70-year-old senior, a 10-year term policy might cost around $91 per month, making it an attractive option for budget-conscious individuals.

RBC Insurance offers a range of term life insurance options suitable for seniors, including 10 and 15-year terms. They are known for their excellent customer service and robust financial backing. RBC’s policies are flexible, allowing seniors to choose coverage that fits their specific needs and budget. A 70-year-old might expect to pay around $243 per month for a 10-year term policy with RBC, reflecting their commitment to providing tailored coverage for seniors/

Manulife is another strong contender, offering term life insurance policies that are particularly senior-friendly. They provide a range of options, including 10 and 20-year terms, with competitive rates. Manulife’s policies often include features like guaranteed renewability and the option to convert to permanent life insurance, which can be beneficial for seniors looking for long-term security. For a 70-year-old, Manulife’s 10-year term policy might cost approximately $230 per month.

Sun Life stands out for its comprehensive customer service and strong financial stability. They offer flexible term lengths and coverage amounts, making it easier for seniors to find a policy that meets their needs. Sun Life is also known for its living benefits, which can provide additional financial support if the policyholder experiences a serious illness. A 70-year-old could expect to pay about $235 per month for a 10-year term policy.

BMO Insurance offers term life insurance with competitive rates and a focus on simplicity. Their policies are easy to understand and come with flexible options, such as the ability to convert to a permanent policy. This makes BMO a solid choice for seniors who want straightforward coverage without any unnecessary complexity. A 70-year-old might pay around $240 per month for a 10-year term policy with BMO.

As you age, the cost of term life insurance rises significantly. The monthly premiums increase rapidly due to the higher risk associated with insuring older individuals. Here’s a breakdown of the average costs for a woman seeking $500,000 in coverage for a 10-year term life policy:

• 50-year-old: $44.59 per month
• 55-year-old: $74.20 per month
• 60-year-old: $140.40 per month
• 65-year-old: $234.21 per month
• 70-year-old: $425.27 per month

A 50-year-old pays $44.59 per month for a $500,000 policy, while a 70-year-old would pay $425.27 per month for the same coverage. This stark increase highlights the importance of obtaining life insurance sooner rather than later.

1. Higher Risk of Health Issues: As people age, the likelihood of developing health problems increases, which raises the risk for insurers.

2. Shorter Life Expectancy: Older individuals have a shorter life expectancy, making it more likely that the insurance company will have to pay out the policy.

3. Cost of Underwriting: The process of assessing older applicants is more thorough and costly, which contributes to higher premiums.

If you’re set on getting a term life policy, it’s crucial to lock in your rates as early as possible.

Here’s why:

1. Lower Premiums: Locking in rates at a younger age ensures you pay lower premiums throughout the term of the policy.

2. Fixed Costs: By securing a term policy early, you avoid future rate hikes and can budget more effectively.

3. Guaranteed Coverage: Early application increases the chance of being approved before any potential health issues arise.

While term life insurance can be a viable option for seniors, the rapid increase in premiums with age makes it essential to lock in rates as early as possible to manage costs effectively.

Term life insurance can be a practical choice for seniors seeking affordable coverage, depending on the specifics of their coverage needs and the applicant’s health background. But at older ages, term life can come with a hefty monthly premium due to the increased risk to insurers. 

It may be worth considering final expense insurance, also known as burial or funeral insurance. This type of policy is specifically designed to cover the costs associated with end-of-life expenses, such as funeral services, medical bills, and other debts. Here’s why final expense insurance might be a better fit:

1. Lower Premiums: Final expense insurance generally offers lower premiums compared to term life insurance for seniors. This makes it more affordable on a monthly basis, easing the financial burden.

2. Guaranteed Acceptance: Many final expense policies offer guaranteed acceptance regardless of health, which can be particularly beneficial for seniors who might struggle to qualify for other types of insurance.

3. Sufficient Coverage: These policies typically provide enough coverage to handle funeral costs and other minor expenses, ensuring your family isn’t left with a financial burden.

4. Simplified Process: The application process for final expense insurance is usually straightforward and does not require a medical exam, making it quick and easy to obtain.

• Understand Your Needs: Assess your financial situation and health, and decide how long you need coverage.
• Compare Policies: Look at options from top providers like PolicyMe and RBC Insurance, considering term lengths and premiums.
• Focus on Key Factors: Choose shorter term lengths for lower premiums and ensure reliable customer service.