Life Insurance Policy in Alberta: Term vs. Permanent Coverage Explained

There are two main types of life insurance in Alberta- term life and whole life insurance. Both are popular and distinct in their characteristics and benefits that meet the needs of different individuals.

If you are looking for life insurance coverage in Alberta, you are taking the first step to protecting the future of your loved ones. You can also get living benefits if you buy permanent life insurance.

Life insurance coverage will ensure you get financial benefits during critical stages of your life – illness, disability, and death. These life stages can come when least expected. Thus, getting insurance that suits your goals and lifestyle is the smartest thing you can do to secure your future.

But which insurance product is right for you? In this article, we will explain the benefits of term life insurance and permanent life insurance.

You will know and understand how they work so you can make the right choice based on your financial goals, personal circumstances, and your budget. When you want to compare prices to save time and money, you can fill out our short online form to receive FREE and NO OBLIGATION quotes.

Who needs life insurance in Alberta?

Many people overlook the importance of life insurance. With numerous expenses in daily life, it is not surprising that many also choose to delay buying life insurance coverage. However, since life can throw many unexpected challenges our way, it could be too late to get coverage when it is needed most.

Life insurance serves as a very useful financial tool for residents of Alberta, Canada, offering benefits that help to reach long-term financial goals and meet obligations. With that said, not everyone needs life insurance.

The following are types of individuals who could benefit significantly from life insurance coverage.

1. Individuals with Dependents

If you have young children (minors) who depend on you for support, or other dependents such as elderly parents, you need life insurance.

Life insurance proceeds (death benefits) will provide financial security to your dependents in the event of your unexpected passing. The benefits can be used to pay for their daily living expenses, housing, education, medical expenses, etc.

In addition, your life insurance benefits can also pay for outstanding loans that you will leave behind such as a mortgage, credit card bills, medical bills, business loans, etc. This ensures your family members will not be burdened by financial obligations when you are gone. They can continue to enjoy the lifestyle they are comfortable with and not worry about their future.

2. Homeowners with Mortgages

If you have a mortgage, you need life insurance until your mortgage is paid off. The benefits of life insurance will ensure your loved ones don’t lose the home you have provided for them or face financial hardship.

Life insurance benefits can cover the balance of your mortgage. Any remaining sum can be used by your beneficiaries to pay for education, living expenses, long-term care, or other debts.

3. Business Owners

If you are a business owner or entrepreneur, life insurance is a necessity. The insurance proceeds will protect your business in the event of your death from creditors. It will provide funds to cover debts and other obligations related to your business.

4. Single Adults

Single adults, regardless of age, also need life insurance. Individuals who take out life insurance while young and in good health can enjoy lower life insurance premiums for life.

Even if you don’t have dependents, life insurance can still pay for your loans, mortgage, credit card balances, and funeral expenses.

Life insurance pals a crucial role in the financial planning for single adults. If you buy whole life insurance in your 20s or 30s, you can lock in low insurance rates and build cash value over time. As you can see, life insurance can also be a good investment strategy.

5. Individuals who want to plan for final expenses

Even if you already have life insurance to benefit your spouse or children, you may still want additional coverage for final expenses.

Anybody who wants their funeral expenses to be paid for without burdening loved ones can depend on life insurance to do so.

Life insurance, upon your death, can pay for funeral and burial expenses.

6. Wealthy Individuals

If you have considerable wealth or a significant estate, you can get life insurance to offset estate liabilities or taxes.

Life insurance can ensure your wealth is transferred to your beneficiaries smoothly.

7. Stay-at-Home Parents

Caregivers or stay-at-home parents may not have an income but provide important support to the home. Life insurance can give financial support for education, home care, and childcare if you die unexpectedly.

Tips for buying life insurance in Alberta

Residents of Alberta buying life insurance must consider the cost of living and provincial tax laws. Life insurance is tax-free in Canada, making it a very efficient tool for financial planning.

The face amount or death benefits should cover rising costs today and the years to come.

If you have group life insurance from your employer, make sure to convert it to an individual policy before you quit your job or retire.

To find out if you need life insurance and how much you need, consult a financial advisor. You can also compare life insurance quotes by filling out the short online form on this page.

Who doesn’t need life insurance?

Life insurance, while practical and even necessary for most people, may be useless for others. Individuals who don’t need life insurance are:

People with significant wealth with an estate plan that provides adequately for beneficiaries.
Individuals with significant savings to cover all financial obligations and final expenses.
Individuals with no dependents or debts.

As you can see, only a very few privileged individuals don’t need life insurance. For many of us, life insurance coverage is an essential step to planning for the future

Most Popular Types of Life Insurance in Alberta

If you are shopping for life insurance, you will come across several types, with each one designed for special financial needs.

Below are 3 of the most popular types of life insurance in Alberta.

1. Term Life Insurance

Main Features:

Coverage Period: Protection for a specific period like 10, 20, or 30 years.
Cost: Typically cheaper with fixed premiums during the term. Rates can increase upon renewal at the end of the term.
Cash Value: No cash value. If you cancel your policy, no premiums are refunded.
Ideal for temporary needs such as covering a mortgage or supporting children until they complete their education.
Flexibility: Some term life insurance policies provide an option to convert to whole life insurance without another medical exam during the term.

Pros:

Lower cost than other life insurance products
Flexible terms available to suit your needs
The simplest form of life insurance

Cons:

Zero savings
Coverage ends after the term
Price will increase if you decide to renew your policy
You need to qualify for coverage if you renew your policy

2. Whole Life Insurance

- Coverage Period: Lifetime coverage (provided premiums are paid and up-to-date)

Cost: More expensive but premiums are fixed for life

Cash Value: Cash value accumulates over time. You can borrow against cash value. You also receive the cash value when you cancel your policy.
Suitable for estate planning or covering financial obligations
Dividends: Some whole life policies offer dividends which can be used to pay for the cost of premiums or to increase the policy’s cash value.

Pros:

Lifetime coverage
Accumulates cash value
Fixed premiums for life
Guaranteed insurability with no renewal required

Cons:

More expensive
More complicated than term life insurance

You can compare the features of term life insurance vs. whole life insurance to choose the product that suits your needs and your budget.

While whole life insurance has more expensive premiums, the cost becomes relatively cheaper over time because the premiums stay level.

Compare life insurance quotes in Alberta from top insurers using our short and free online form!

Which life insurance product should you choose? Term Life vs. Whole Life Insurance

It may seem complicated but choosing the right life insurance product can be easier than you think.

Which Should You Choose?

Term Life Insurance: It is most suitable for those who need temporary coverage for specific financial needs such as mortgage insurance. It is also ideal for people who want insurance coverage but can’t afford expensive premiums.
Whole Life Insurance: This is suitable for individuals who need lifetime insurance protection, are still relatively young and in good health, want savings to build over time, and can afford to spend a little more for insurance benefits.

Insurance premiums in Alberta are impacted by age, state of health, and lifestyle. Hence, buying life insurance at an earlier age can result in significantly cheaper premiums.

Align your financial goals with your life insurance options to get maximum protection for you and your loved ones.

Do you need cheaper premiums for short-term protection? Choose Term Life Insurance

Do you want lifetime insurance coverage with cash value? Choose Whole Life Insurance

You can get life insurance quotes tailored to your needs from our reputable insurance partners by filling out the short form on this page.

Take the next step to securing your future by choosing the best life insurance product in Alberta with FREE and NO OBLIGATION quotes.

How much is Term Life Insurance vs. Whole Life Insurance?

The cost of term life insurance vs. whole life insurance in Alberta is influenced by factors including age, health status, desired amount of coverage, and lifestyle.

However, it is safe to say that term life insurance is significantly cheaper than whole life insurance for the same amount of coverage. But keep in mind that term life insurance is for a limited period, say 15 years, while whole life insurance is valid throughout your lifetime.

In short, term life insurance for $150,000 for 15 years will have lower premiums but your beneficiaries will only receive benefits if you die within the term.

Here’s a general comparison of these 2 life insurance products:

Term Life Insurance Cost

Cheaper, but premiums increase if renewed after the term ends.

Best for short-term protection (example: mortgage, education, debt protection)

The following table shows average prices for term life insurance for $500,000 for 20-year term.

Age	Average Monthly Premiums Based on Gender
	Male	Female
25 years old	$25 to $40	$20 to $30
35 years old	$40 to $50	$30 to $40
45 years old	$70 to $115	$55 to $85
55 years old	$180 to $300	$140 to $250

Insurance premiums for women generally cost about 20% less than men due to longer life expectancy.
Smokers, (male or female), generally pay 2 to 3 times higher premiums than non-smokers.
Pre-existing medical conditions will also increase insurance premiums.

Whole Life Insurance Cost

As mentioned earlier, whole life insurance is more expensive but offers lifetime insurance coverage and cash value and savings.

The table below will show you the average monthly premiums for whole life insurance in Alberta for coverage of $500,000.

Age	Average Monthly Premiums Based on Gender
	Male	Female
25 years old	$230 to $320	$200 to $300
35 years old	$285 to $350	$253 to $300
45 years old	$347 to $420	$290 to $350

These rates are for illustration purposes only and may vary based on your personal information.

Many factors affect the cost of whole life insurance premiums. In addition to age and health status, other factors like high-risk occupations, risky activities, poor driving record, travel to high-risk countries, and smoking status (cigarettes, e-cigarettes, and marijuana) can increase insurance premiums.

Despite the higher cost, whole life insurance can be worth it as it offers a financial safety net even while you are alive because of its cumulative cash value. This benefit is on top of the benefits your beneficiaries receive upon your demise.

It is up to you to decide whether to choose term life insurance or whole life insurance. Consider the key benefits vs. the cost to find the right life insurance coverage for you!

Fill out the short online form on this page to get accurate quotes for term life or whole life insurance.

How to apply for Life Insurance Coverage

To apply for life insurance coverage in Alberta, plan carefully and choose the right policy. Below is a step-by-step guide you can follow.

Step 1: Know Your Needs.

Before applying for life insurance, consider how much your beneficiaries or dependents will need if you pass away. Calculate the cost of your mortgage, outstanding debts, and future living expenses.

Determine if you want term life insurance or whole life insurance. Consider the cost of monthly premiums to help you decide based on what you can afford.

If you prefer whole life insurance but can’t afford it at the moment, remember that you can always convert your term life insurance policy to whole life insurance in the future.

If you are unsure about how much coverage you need, a good rule of thumb is to get coverage that is 10 times your yearly income.

Step 2: Compare Insurance Quotes to save time and money.

You can request free quotes by filling out our short online form to compare prices and life insurance products. Choose the best policy that suits your needs and budget.

Step 3: Submit an Application

Once you choose the type of life insurance policy and life insurance company, you can now apply for coverage.

You will be asked to provide the following details:

Personal information: Age, occupation, lifestyle habits (e.g., smoking, drinking).
Health history – Medical conditions, family history, medications.
Financial details – Income, outstanding debts (for higher coverage amounts).

Standard life insurance policies require a medical exam. If you don’t want to undergo a health check, you can choose no-medical life insurance. You will only be asked a few questions but their premiums are very expensive.

Step 4: Underwriting (Approval)

The insurer will review your personal information and risk factors.

Depending on the insurer, the approval process can take days or a couple of weeks, depending on the type of policy you selected.

Tip: If you are in a hurry, simplified issue life insurance (no medical exam) can take only 1-2 days to get approved. Note that premiums for this type of coverage are much higher than standard policies. The amount of coverage also has limits.

After the insurer issues your policy, you are now actively protected! Keep your premiums paid regularly to ensure your coverage is in good standing.

Need help finding the Best Prices for Life Insurance in Alberta?

Finding the best prices for life insurance in Alberta has never been this easy. You don’t need to contact multiple insurers and brokers to get quotes.

Surely, you don’t want to sit through long and boring presentations from agents who are eager to convince you to buy life insurance.

Compare free online insurance quotes in the comfort of your home or office!

Our partner insurers and brokers offer excellent deals on term life and whole life insurance. All you need to do is fill out our short online form to receive the best term life insurance quotes in Alberta.

If you prefer lifetime coverage with whole life insurance, our partners can find you the best coverage at the lowest prices.

Take 2 minutes today to connect with reputable insurers in Alberta with one free online form below.

+110 Broker Partners in Quebec
Compare Life Insurance Prices from +20 Insurers
Ask your Quote in 2 Minutes

Get a Free Quote for your life insurance