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Life insurance

Comparing types of life insurance Add to ...

Get the type of insurance that best meets your needs. The table below summarizes the types of insurance available and how each is most commonly used.

Type of life insurance policyPremiums and coverage timeHow this insurance might be used
Term

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Insurance coverage guaranteed for a pre-defined term, typically 5, 10 or 20 years


Premiums stay the same for length of the term


Renewal of term is guaranteed, but at a higher premium rate


Coverage ends at a specified age (often age 75 to 85)


Lowest cost form of insurance

Often used during working years to provide the capital needed to replace income when a key breadwinner dies


Coverage is not guaranteed for life, so may not be appropriate for estate planning goals

​Term to 100

 

 

 

 

 

 

 

 

 

 

 

 

 

​Permanent insurance guaranteed for life


Premiums stay the same until age 100, or may in some cases be payable over 20 years


Typically has no savings component or cash value


Lowest cost form of permanent insurance

Pre-retirement – can be used to replace income if you were to die unexpectedly


Retirement – can be used to cover your estate’s tax liability or add to your estate’s value

​Universal life

 

 

 

 

 

 

 

 

 

 

​Permanent insurance guaranteed for life


Premiums are adjustable depending on savings and insurance needs


Policy provides both insurance protection and tax-sheltered savings

Retirement – savings can be used to cover ongoing premiums, increase the policy’s death benefit or used as loan collateral to provide money in retirement


Estate – can be used to cover your estate’s tax liability or add to your estate’s value

Whole life

 

 

 

 

 

 

 

 

 

 

​Permanent insurance guaranteed for life


Premiums stay the same for life


Policy has a cash value that you can borrow against, or cash out if you terminate the policy

​Retirement – savings can be used as loan collateral to provide money in retirement, or withdrawn if you end the policy


Estate – can be used to cover your estate’s tax liability or enhance your estate’s value

 

Learn more about your life insurance options.

 

Content in this section is provided in partnership with Investor Education Fund, a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help Canadians make better money decisions. To find out more, go to: GetSmarterAboutMoney.ca

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