Life insurance is an essential financial tool to protect your loved ones. In fact, six in ten households believe in using life insurance to protect their family members. But have you ever wondered how much insurance coverage actually costs?
Unfortunately, calculating the average cost of life insurance can be tricky. That is because premiums can drastically change based on various factors, from fee to age. So, how do you find the perfect policy to cover your family’s needs?
Read on to learn how much life insurance costs in Canada and how it varies. Further in the article, we will explore the factors that impact premiums and ways to gain quotes. Let’s jump right in!
The approximate cost of life insurance in Canada varies between $15 and $100 per month. The exact price depends on personal factors and the specifics of your policy. It may also vary based on elements that you control, like your lifestyle and profession.
Another thing to consider is that as you age, your premium costs will also increase. So, the sooner you apply for life insurance, the better!
Buying life insurance lets you transfer your financial risk to the insurance company. So, youpay a certain amount so that your insurer pays your beneficiaries.
To ensure your family gets a death benefit, insurance providers size you up like a detective. Why? Because they are on a mission to figure out your risk profile! They will examine your health, habits, and lifestyle to determine your level.
If your risk of dying is higher than average, you will end up paying more! To sum it up, if you live dangerously, your premiums will skyrocket. But if you play it safe, your rates will stay low.
Here are several factors that play a role in determining your insurance premium cost:
The general rule of thumb is, that the more your age, the higher your premiums will be! So, if you are on the sunny side of your thirties, consider yourself in luck. There is a high chance that your insurance premiums will be low. But here is the twist. The cost of life insurance varies based on your nearest birthday.
Now, picture this: you are turning 39 within the next four months, and your partner will turn 45 in 11 months. The insurer will consider you 39 and your spouse 44 when getting the policy.
Gender is another major consideration factor for insurance companies. Since women tend to have a longer lifespan generally, their premiums are 10 to 15% lower than male candidates.
Insurance providers are always on the lookout for physically fit candidates. So, they will check your height and weight to ensure you are healthy.
Insurance companies will also check if you are taking any medications. They will want to know if you have a chronic condition, like blood pressure. Your nicotine and alcohol consumption is a massive red flag for them.
But here is the good news. If you pass your medical exam, your life insurance cost will be pretty economical. However, if you prefer alternatives, you can skip the full-blown medical exam. Instead, the insurer will ask several questions about your health history.
The downside? Convenience comes at a price, so it is pricier than the fully underwritten policies.
You might not be aware of this, but your daily grind and hobbies can shake up your life insurance premiums. Some people enjoy activities that make their heart race and insurers nervous! So, if you are a daredevil who enjoys skydiving or rock climbing, prepare for higher premiums!
But that is not all! People who are into mining and other risky professions where their life is always at stake make insurers nervous too. So, their life insurance premiums are as high as a kite!
On the flip side, people in low-risk jobs, the ones at school or the office, enjoy lower rates.
Here is where it gets interesting- your coverage type and amount matter! We will explain it to you through a simple example: It’s like picking the right outfit for the occasion. First, there is term life insurance- it’s like renting a tuxedo. So, you get coverage for a set period and lower premiums.
On the other hand, permanent life insurance is like owning a classic suit. It covers your whole life but with a hefty fee. So, the coverage amount you choose is like picking the right suit size. If you go for a super-sized coverage, you will have to pay that premium price.
As we mentioned earlier, as the candles on your birthday cake increase, so do your premiums. But whether you are a smoker or non-smoker plays a critical role.
At the age of 25, non-smokers might pay between $13 to $27. But if you are a smoker, be prepared for a hefty $48. Fast forward to your 40s and the premium increases!
Generally, non-smokers have to pay anywhere from $21 to $42. On the contrary, smokers might face a heavy bill of $119. By the time you hit 40 and above, your premiums range from $124 to $363, while smokers have to pay approximately $811.62.
Finally, let’s discuss how you can get a quote. It’s pretty simple. You decide the type of policy and coverage and start seeking candidates.
Once you list insurers who match your needs, you can request free quotations. The initial quote will offer you insights on the approximate premium. But here’s the twist- the amount can vary after the provider gathers all the information.
Life insurance is crucial to ensure your loved ones are always in safe hands. But to get the perfect coverage, you’ll have to consider the factors that affect the premiums.
In general, personal factors, like age and policy type, can impact the cost of life insurance. So, keep these factors in mind when surveying the market for coverage.
If you are young, healthy, and do not indulge in dangerous or life-threatening activities, you will be safe. On the other hand, people in risky occupations can expect higher premiums. So, it is better to consider talking to a professional to find the most affordable life insurance.