Life Insurance Costs in Canada by Age

The table below shows Sun Life’s published sample monthly rates for $500,000 of Sun Life Go Term Life Insurance with a 10-year term. The examples are organized by age, smoking status and assigned sex at birth.

Table assumptions:

• Policy type: 10-year term life insurance
• Coverage amount: $500,000
• Sample product: Sun Life Go Term Life Insurance
• Published rates: Subject to change
• Payment frequency: Monthly

These prices are approximate and provided only for educational comparison. Your final price will be determined after the insurer reviews your application, health and other personal circumstances.

To get and compare life insurance quotes online:

https://mehdirad.ca/en/quote

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Life Insurance Cost at Age 30

Among the ages compared in this article, applicants at age 30 have the lowest sample premiums. A 30-year-old female non-smoker might pay approximately $13.95 per month for $500,000 of 10-year term coverage, while a male non-smoker of the same age might pay approximately $20.25.

The published smoker rates are approximately $26.10 per month for females and $43.20 for males.

Buying life insurance at this age can offer several advantages:

• Initial premiums are generally lower.
• Applicants may have a better chance of qualifying for standard rates while healthy.
• Coverage can be aligned with a mortgage or the years children are financially dependent.
• Younger applicants may have access to a wider range of products and policy lengths.

Being young, however, does not automatically mean you need a large policy. Someone without financial dependants, shared debts or another identifiable need may require a different amount of coverage than a parent or homeowner.

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Life Insurance Cost at Age 40

Life insurance can still be relatively affordable at age 40, but the sample rates are higher than at age 30.

For $500,000 of 10-year term insurance, a 40-year-old female non-smoker might pay approximately $18.00per month. The corresponding sample rate f or a male non-smoker is $27.10.

For smokers, the example premiums increase to approximately $53.55 for females and $67.55 for males.

Many people have greater financial responsibilities at this stage of life, including:

• A mortgage
• Financially dependent children
• Future education costs
• A spouse who depends on their income
• Personal or business debts
• Limited workplace life insurance

When buying coverage at age 40, do not consider only today’s premium. If your need will continue for 20 or 30 years, an inexpensive 10-year policy may become significantly more expensive when it renews.

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Life Insurance Cost at Age 50

The increase in life insurance premiums becomes more noticeable by age 50. In the published example, $500,000 of 10-year term insurance costs approximately $44.55 per month for a female non-smoker and $61.20 for a male non-smoker.

The smoker examples increase to approximately $127.80 for females and $206.55 for males.

Before choosing a coverage amount at age 50, it is helpful to recalculate your actual need. Part of your mortgage may have been repaid, your children may be approaching financial independence, or your savings may have increased.

On the other hand, you may still need substantial coverage for:

• Income replacement
• Remaining mortgage and other debts
• Support for a spouse
• Education expenses
• Business obligations
• Estate-planning needs

You should also review any existing insurance. If a term policy is approaching the end of its initial period, examine its renewal rates, conversion options and the possibility of applying for a new policy before the existing coverage expires.

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Life Insurance Cost at Age 60

Term life insurance can be considerably more expensive at age 60 than at younger ages.

In the sample rates, $500,000 of 10-year term coverage costs approximately $144.33 per month for a female non-smoker and $191.85 for a male non-smoker.

The smoker examples rise to approximately $320.85 per month for females and $559.80 for males.

These figures show why the purpose and amount of insurance should be examined carefully at this age. Some applicants may no longer need $500,000 of coverage. A smaller amount might be sufficient for final expenses, support for a spouse or a specific remaining obligation.

Other applicants may have a permanent need related to:

• Estate planning
• A potential estate tax obligation
• Support for a lifelong dependant
• Leaving an inheritance
• Business succession

The purpose of life insurance at age 60 may be different from its purpose at age 30. Comparing prices without first identifying that purpose may lead to buying too much, too little or the wrong type of coverage.

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Why Does Life Insurance Become More Expensive with Age?

Insurance companies determine premiums according to the amount of risk they accept. As an applicant gets older, there is a greater probability that the insurer will pay the death benefit during the policy period. Premiums therefore generally increase with age.

The Financial Consumer Agency of Canada explains that insurance premiums may depend on factors such as the type of insurance, age, gender, medical history and coverage amount.

Older applicants are also more likely to have medical conditions, take prescription medications or require additional underwriting. However, applicants of the same age do not necessarily receive identical prices. Their health and other personal circumstances can produce different underwriting decisions.

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How Does Smoking Affect Life Insurance Costs?

The published rates show that smokers may pay substantially more than non-smokers for identical coverage.

At age 50, for example:

• Female non-smoker: $44.55 per month
• Female smoker: $127.80 per month
• Male non-smoker: $61.20 per month
• Male smoker: $206.55 per month

The definition of smoker or non-smoker can vary between insurers. Tobacco or nicotine use must be disclosed accurately in response to the application questions.

Someone who has stopped using tobacco or nicotine may eventually qualify for non-smoker pricing after satisfying the insurer’s required period and underwriting conditions. The exact rules should be confirmed with the insurer or a licensed insurance representative.

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Term or Permanent Life Insurance?

Term life insurance

Term life insurance provides coverage for a defined period, such as 10, 20 or 30 years. According to the Financial Consumer Agency of Canada, it is generally less expensive than permanent life insurance when first purchased.

Term insurance is commonly used for temporary needs such as:

• A mortgage
• Income replacement during working years
• Support for children until they become financially independent
• A personal or business debt with a defined end date

When the initial term ends, coverage may expire or renew at a higher premium. Some policies may also allow conversion to permanent insurance without new medical evidence. Renewal and conversion rights depend on the contract.

Permanent life insurance

Permanent insurance is intended to provide lifetime coverage as long as the policy requirements are met. Some permanent products may also include cash values or other features.

Permanent insurance may be considered for needs such as:

• Final expenses
• Estate planning and inheritance
• A permanent tax liability
• Lifelong support for a dependant
• Business succession planning

Permanent insurance generally costs more than term insurance. Whole life, participating whole life and universal life may also have different costs, guarantees and risks. They should not be compared using only the initial monthly premium.

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How Much Coverage Do You Need?

Your coverage amount should not be chosen solely because a particular quotation looks inexpensive. A practical needs calculation may include:

• Mortgage balance and other debts
• Income your family would need to replace
• Number of years that income would be required
• Childcare and education costs
• Final expenses
• Business or tax obligations
• Other financial goals

You can then subtract financial resources already dedicated to these needs, such as savings and existing individual life insurance.

Workplace coverage may also provide some protection, but it can be limited and may not continue when you change jobs or leave your employer. Review the group plan before relying on it as your primary coverage.

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How to Reduce Your Life Insurance Cost

Apply earlier

Under otherwise similar circumstances, life insurance normally costs less at a younger age. Applying earlier can also reduce the possibility that a future health change will affect your price or eligibility.

Choose an appropriate term

The policy term should reflect how long the financial need is expected to continue. Choosing a 10-year policy for a 30-year need may cost less today, but renewing or replacing it later could be much more expensive.

Calculate the coverage amount

Too little coverage may leave your family with a financial shortfall. Excessive coverage can create an unnecessary expense. Start with the need rather than an arbitrary amount.

Compare multiple insurers

Insurers may assess the same applicant differently under their underwriting guidelines. Compare quotations using the same coverage amount, term, smoking classification, policy type and optional benefits.

Consider annual payments

For some policies, one annual payment may cost less than the combined total of 12 monthly payments. Compare the full annual cost of both options.

Avoid unnecessary optional benefits

Policy riders can be valuable, but they may increase the premium. Add a rider when it addresses an identifiable need—not simply because it is available.

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Common Pricing Mistakes

Comparing different types of policies

A 10-year policy cannot be fairly compared with a 30-year policy or permanent coverage. The coverage amount, policy type, guarantee period and optional benefits should be equivalent.

Choosing the shortest term only because it is cheaper

If the financial need will last longer, a short term may require an expensive renewal or a new application later.

Treating an online rate as a guaranteed price

Online prices are estimates. The final premium is determined after the insurer reviews the application.

Providing incomplete information

Application answers must be complete and accurate. Incorrect information may affect the validity of the policy or a future claim.

Cancelling existing coverage too early

Do not cancel an existing policy until the replacement coverage has been approved, issued, reviewed and confirmed to be in force.

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Frequently Asked Questions

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Key Takeaways

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