What is the cheapest term life insurance in Canada?

For a healthy 30-year-old non-smoker seeking $500,000 of 20-year term coverage, the cheapest options typically start around $22–$28/month. PolicyMe, Sun Life, and Canada Life consistently offer some of the lowest premiums. Online-only insurers like PolicyMe tend to be 10–20% cheaper than traditional providers.

How much term life insurance do I need?

A common guideline is 10–12× your annual income, but the right amount depends on your debts (especially mortgage), dependents, income replacement needs, and existing coverage through work. Use a needs-based calculation: total financial obligations minus existing assets and coverage.

Is term or whole life insurance better?

Term life insurance is better for most Canadians. It covers your highest-need years (while you have a mortgage, young children, etc.) at a fraction of the cost. Whole life is 5–10× more expensive and only makes sense for estate planning, permanent dependents, or tax-sheltered wealth transfer.

Can I convert my term policy to permanent insurance?

Most term life policies in Canada include a conversion privilege that lets you convert to permanent (whole or universal) coverage without a medical exam before the conversion deadline (typically age 65–71). This is valuable if your health deteriorates during the term.

Best Term Life Insurance in Canada 2026

Term life insurance is the most affordable way to replace your income for dependants during your working years — typically 10, 20, or 30 years.

Best Term Life Insurance Companies Compared

Company	20-Year Term ($500K, Age 30, Non-Smoker)	Online Application	Conversion Option	No-Exam Option	Rating
PolicyMe	~$22/month	✅ Fully online	✅	✅ (up to $1M)	★★★★★
Sun Life	~$25/month	⚠️ Partial	✅	✅ (up to $500K)	★★★★★
Canada Life	~$26/month	⚠️ Partial	✅	✅ (up to $1M)	★★★★☆
Manulife	~$27/month	⚠️ Partial	✅	✅ (up to $1M)	★★★★☆
RBC Insurance	~$28/month	✅ Online	✅	✅ (up to $500K)	★★★★☆
Desjardins	~$27/month	❌ Advisor	✅	❌	★★★★☆
BMO Insurance	~$29/month	⚠️ Partial	✅	✅ (up to $500K)	★★★★☆
Industrial Alliance (iA)	~$26/month	❌ Advisor	✅	✅	★★★★☆

Rates are estimates for a healthy 30-year-old male non-smoker. Female rates are typically 15–25% lower. Actual rates depend on health, lifestyle, and underwriting.

Term Life Insurance Rates by Age

Monthly Cost: $500,000, 20-Year Term, Non-Smoker (Male / Female)

Age	PolicyMe	Sun Life	Canada Life	Manulife	RBC
25	$18 / $15	$21 / $17	$22 / $18	$23 / $19	$24 / $19
30	$22 / $18	$25 / $20	$26 / $21	$27 / $22	$28 / $22
35	$28 / $23	$31 / $26	$33 / $27	$34 / $28	$35 / $29
40	$40 / $34	$44 / $37	$46 / $39	$48 / $40	$49 / $41
45	$65 / $52	$72 / $58	$75 / $60	$78 / $62	$80 / $64
50	$110 / $85	$120 / $95	$125 / $98	$130 / $100	$135 / $105

How Smoking Affects Rates

Age	Non-Smoker (Male)	Smoker (Male)	Premium Increase
30	~$22/month	~$55/month	+150%
40	~$40/month	~$110/month	+175%
50	~$110/month	~$320/month	+190%

Term Length Options

Term Length	Best For	Average Monthly Cost ($500K, Age 30)
10-year	Short-term need (mortgage nearly paid, kids almost grown)	$14–$18
15-year	Medium-term coverage	$18–$22
20-year	Most common — covers peak financial years	$22–$28
25-year	Longer coverage to age 55	$28–$35
30-year	Maximum coverage period	$32–$42

How to Choose the Right Term Length

Your Situation	Recommended Term
New mortgage (25-year amortization)	20 or 25-year term
Newborn child	20-year term (covers until they’re independent)
10 years from mortgage payoff	10-year term
Age 35, want coverage to 65	30-year term
Single, no dependents	May not need term life at all

Key Features to Compare

Riders and Add-Ons

Rider	What It Does	Typical Cost	Who Needs It
Critical illness rider	Pays lump sum if diagnosed with covered illness	+30–50% of premium	Those without standalone CI coverage
Disability waiver	Waives premiums if you become disabled	+5–10%	Self-employed, no group disability
Child rider	Covers children’s death	+$5–$10/month	Parents with no child coverage
Accidental death	Double payout for accidental death	+$2–$5/month	Generally not recommended
Guaranteed insurability	Buy more coverage later without medical exam	+5–10%	Young people expecting future needs

Conversion Privileges

Company	Conversion Deadline	Convert To	Medical Exam Required?
PolicyMe	Age 65	Whole life	No
Sun Life	Age 71	Whole or universal	No
Canada Life	Age 65	Whole or universal	No
Manulife	Age 71	Whole or universal	No
RBC Insurance	Age 65	Whole life	No
iA Financial	Age 65	Whole or universal	No

No-Exam vs Traditional Underwriting

Feature	No-Exam (Simplified Issue)	Traditional (Fully Underwritten)
Application time	20–30 minutes online	2–6 weeks, medical exam required
Maximum coverage	$1,000,000–$2,000,000	Unlimited
Premium cost	5–15% higher	Lowest available rates
Health questions	Yes (shortened questionnaire)	Full medical history + exam
Blood/urine tests	No	Yes
Best for	Healthy applicants wanting fast approval	Those seeking maximum savings or high coverage

How to Save on Term Life Insurance

Strategy	Potential Savings
Buy young (rates lock in at purchase age)	30–50% vs buying 10 years later
Compare at least 3–5 quotes	10–20%
Choose online-only insurer (PolicyMe, etc.)	10–20% vs traditional
Don’t over-insure (calculate actual needs)	Varies
Quit smoking (rates drop after 12 months tobacco-free)	50–65%
Improve health markers before applying	5–15%
Bundle term lengths for different needs	Varies

Group Life Insurance vs Individual Term

Feature	Group (Employer)	Individual Term
Cost	Often free or subsidized	You pay full premium
Coverage amount	Typically 1–2× salary	You choose (up to millions)
Portability	Lost when you leave employer	Stays with you
Customization	Limited	Full choice of term, riders
Medical exam	Usually none	May be required
Recommendation	Keep as base + supplement with individual	Primary coverage you control

Application Process

Step	What Happens	Timeline
1. Get quotes	Compare rates online	15 minutes
2. Apply	Complete application (online or with advisor)	20–60 minutes
3. Underwriting	Insurer reviews your application	Instant to 6 weeks
4. Medical exam (if required)	Paramedical exam at your home/office	30 minutes
5. Approval	Policy issued and coverage begins	Same day to 8 weeks
6. Free-look period	Cancel within 10–30 days for full refund	10–30 days