Term life insurance is a very popular choice for many Canadians who purchase life insurance. We are commonly asked what is the best type of term life insurance to buy.
There are different lengths of term life insurance available to purchase. The amount of years the term lasts determines how long the premiums or “cost” of the policy and the death benefit or “coverage amount” are fixed for. The length of the term is also a determining factor in the price of the life insurance policy. The longer the length of the term, the higher the premium.
For example, a $500,000 10 year term life insurance policy will have the same monthly cost (or annual cost if paying annually instead of monthly) for 10 years. It will also have the same death benefit (coverage amount) for 10 years.
There are a variety of term lengths available in the Canadian marketplace. 10, 20 and 30 year terms are definitely the most common but some providers offer 15, 25, 35 and 40 year terms as well. We also have access to a few life insurance companies which will let you to pick an exact amount of years for the term length (e.g. 13 years, 22 years, etc.).
The length of the term should match the length of time that you require to have life insurance. If you are wanting to buy life insurance because you recently had a child, you would most likely want to consider having at least a 20 year term length because it will provide your family with life insurance coverage until your child is at least 20 years old. You also would not have to worry about an increase in cost for the policy or a decrease in the death benefit because they are both fixed.
Ideally there are three steps to purchasing life insurance…
Step #1 – Determine the Amount of Coverage (Death Benefit)
The first step when purchasing life insurance is to calculate how much life insurance you need. We recommend that you speak with one of our advisors to walk you through this step.
Step #2 – Choose the Right Type of Life Insurance
After you have determined how much life insurance coverage you need, you need to determine what type of life insurance policy to purchase. Should you purchase term or permanent life insurance? If you are considering a term life insurance policy you would need to figure out the length of the term. An easy way of figuring out the length is to determine how long you need the insurance. Again, we recommend that you reach out to us for guidance with this.
Step #3 – Comparing Companies & Pricing (Quotes)
Once you know how much life insurance you need and the type of insurance, we would work with you to compare quotes from all of the top life insurance providers in Canada to find you a combination of quality product and price.
Please contact us by e-mail or phone at 1-877-344-4011 to discuss your life insurance needs.