18 Must-Read Canadian Life Insurance Statistics [Especially in 2021]

Life insurance is essential for those who want to prepare for the unexpected. It serves as a cushion to surviving loved ones who will be left with the impact, primarily financial, of an individual’s sudden passing. When that happens, beneficiaries usually get a tax-free lump sum from the life insurance company.

But the thing is:

Canadian life insurance statistics reveal that just under half (49%) of Canadians with dependents have never purchased life insurance. On top of that, many of those who do have insurance were underinsured.

Now:

This trend is quite worrying, especially in the trying times we live in. In the event of accidental death, it’s more important than ever to secure the future of our loved ones.

Let’s take a look at some of the crucial Canadian life insurance statistics in 2021 to understand the trend better.

Eye-Opening Insurance Statistics for Canada (Editor’s Choice)

  • Only 38% of Canadians have life insurance through their employer or group.
  • Life insurance is valuable to 64% of Canadians.
  • 56% of Canadians do not plan to buy additional life insurance.
  • Roughly 80% of Canadians purchase their life insurance through in-person sales.
  • About 40% of Canadians do not own life insurance.
  • The contribution of the insurance industry to economic growth is more than $860 billion.
  • Approximately 4 million Canadians under 35 are looking for individual insurance coverage.
  • Brokers and agents have increased their completed annual transactions by 140% since 2013.

General Canadian Life Insurance Facts

insurance statistics

1. A Canadian household has an average life insurance protection of $423,000.

(Source: Mordor Intelligence)

Back in 2017, the average life insurance protection for every household was $417,000. This figure rose to $423,000 in 2020, approximately five times the average household income. Clearly, the COVID-19 pandemic has made Canadians appreciate the importance of life insurance more.

2. According to insurance statistics, about 38% of Canadians have life insurance through their employer or group benefits only.

(Source: Policy Advisor Brokerage)

Insurance coverage is an important consideration for every Canadian. When asked about the option that best describes their coverage, however, about 38% of them said they only have life insurance through their employers.

For 28% of Canadians, individually-owned life insurance also comes with their employer or group insurance. Additionally, around 14% admitted to having no life insurance at all.

3. Insurance statistics reveal around 64% of Canadians put the most value on life insurance.

(Source: Policy Advisor Brokerage)

Insurance comes in different types and coverage. There is insurance for health, life, home, auto, and many more. Interestingly, 64% of Canadians value life insurance the most. Travel and electronics were deemed less important. This 2020 trend reflects the current concerns in the midst of the pandemic. So, it’s understandable that most Canadians will consider insurance coverage for health and life as essential.

4. Around 56% of Canadians have no plans to buy additional life insurance.

(Source: Policy Advisor Brokerage)

The pandemic sowed panic and forced many Canadians to rethink the value of life insurance. However, more than half of those surveyed have no plans to make changes to their current life insurance coverage. This may be due to their comfort with what they presently have and the belief that their coverage can protect them adequately.

On the other hand:

23% of Canadians have purchased new or additional life insurance coverage during the COVID-19 pandemic. Click To Tweet

5. Approximately 4 million Canadians under 35 were looking for individual insurance coverage in 2019, Canadian life insurance statistics reveal.

(Source: Limra.com)

An overwhelming number of Canadians under 35 are “likely” or “very likely” to purchase life insurance in the next 12 months. Moreover, it is highly possible that the number has increased since then, as the pandemic highlighted the pressing need for insurance.

6. 40% of Canadians have no life insurance at all.

(Source: Assets.ey)

Despite the rising appreciation for insurance as an essential need, about four in ten Canadians still don’t own any life insurance. This data comes from the 2020 EY Global Insurance Outlook. So, insurance companies are working to maintain their growth by shifting their focus from product to customers.

The thing is:

Today’s consumers expect greater choice, personalization, simplicity, and ease when it comes to their experience and interactions with insurance agents and brokers.

7. Roughly 80% of Canadians who own insurance have purchased it through in-person sales, insurance statistics reveal.

(Source: Limra.com)

This shows a steady increase of 8% since 2013. So, we can safely say Canadians have a clear preference for purchasing their individual life insurance through in-person sales.

Now:

The demographic that favours in-person sales the most are those 65 and older. In fact, as many as nine in ten senior citizens claim they bought their coverage through this method. This means the age of consumers determines their most preferred distribution preference.

8. The average life insurance payout for a 10-year policy in Canada is $13 per month.

(Source: ratehub.ca)

The average cost of life insurance in Canada usually differs based on a person’s age, health, and the product they want to get.

Confused?

Here’s an example:

For a healthy 30-year-old Canadian, a $100,000 coverage can cost $13 per month. For a 60-year-old, this may climb to as much as $100 each month for the same coverage. As a rule of thumb, your insurance policy should be large enough to replace your income and hedge against inflation.

9. The average life expectancy in Canada is 82.

(Sources: movehub.com, Statista)

Canada is known to have one of the longest life expectancies in the world, according to Canadian health care statistics. Currently, 82 is the average. However, this figure often varies between demographics.

Check this out:

Women born in 2020 have a slightly higher life expectancy than men – 84 compared to 80. The trend in Canadian life expectancy keeps increasing every year, which is a positive sign all around when it comes to life facts.


Canadian Insurance Industry Trends in 2021 

10. The insurance industry contributes more than $860 billion to Canada’s economic growth.

(Source: Newswire.ca)

The insurance industry in Canada operates in every region of the country, with many companies specialising in life insurance. Over the years, their valuable contribution to economic growth accumulated to more than a whopping $860 billion.

Most of this money was allocated to long-term investments in innovation and infrastructure projects. Additionally, insurers create over 157,000 jobs across the country. So, it’s safe to assume that the future of the insurance industry in Canada is looking bright.

11. Life and health insurers paid a total of $103 billion in benefits to Canadians in 2019.

(Source: Newswire.ca)

Thanks to these benefits, Canadians were able to access prescription medicines, live more comfortably in retirement, and cope with critical illnesses. Of the total $103 billion in paid benefits from insurers in 2019 alone, $53.3 billion went to retirement annuity payments. Additionally, $38.1 billion were allocated to health benefits and $12.1 billion to life insurance benefits.

12. Completed annual transactions among brokers and agents increased by 140% since 2013.

(Source: Assets.ey)

According to Canadian life insurance statistics, an astonishing 626 transactions were recorded in 2018, setting the record as the highest annual total. At the same time, there was a decline in the number of buyers completing acquisitions, 142, down from 177 in 2017. This number stood at 152 in 2016.

13. Canada’s largest insurance company increased its assets by 34.3% in 2020.

(Source: Statista, Statista, Forbes)

Hailed as the largest insurance company in Canada, Manulife Financial boosted its worldwide assets considerably in 2020 to an eye-watering $880.35 billion, up from $578.41 billion in 2014. In 2018, its total assets were approximately $750 billion.

Manulife Financial was founded way back in 1887 in Toronto. Today, its market cap is valued at US$41.9 billion.


What Do Canadians Think about the Insurance Industry?

insurance statistics Canada

14. Given the choice, around 52% of Canadians would buy their insurance online.

(Source: Policy Advisor Coverage)

More than half of Canadians expect insurance to work the same way as other online retailers. In contrast, only 21% said they would prefer to meet with an advisor in person, while the remaining 27% are unsure which option to take.

The good news is:

More and more companies are accommodating this shifting trend. So, many of them now approve coverage of up to $1 million without a medical exam, at least for people under the age of 50 and in good health.

15. More than 80% wrongly believe Canadian life insurance rates are too high.

(Source: BNN Bloomberg)

Many people avoid getting insurance because of the perceived expenses.

But the truth is:

Life insurance can actually be very affordable. While an overwhelming number of consumers believe the cost of life insurance is relatively high, according to research by the Life Insurance and Market Research Association, it is still more expensive not to have insurance at all.

As we mentioned earlier, healthy Canadians who don’t smoke can have life insurance coverage for 10 years for only $13 a month.

16. More than 60% of Millennials consider online insurance information to be safe.

(Source: Statista)

In a world where everything can be transacted and done online, it is no longer surprising to find that the majority of Millennials are increasingly taking measures to protect their information in the digital space.

However:

Despite the threats of data breaches, more than six in ten millennials believe their online insurance information is safe, Canadian life insurance statistics reveal. They’re quite aware that insurance companies invest heavily in IT and online security as an added precaution.

17. About 63% of Canadians feel life insurance is more important than ever in the time of the pandemic.

(Source: Policy Advisor Brokerage)

Life insurance was still considered essential even before the pandemic. But when the pandemic hit, nearly two-thirds of Canadians realised that life insurance is more important than ever. Meanwhile, only 2% believe life insurance is less important.

18. About 8% of respondents believe the process of getting life insurance takes too long, Canadian life insurance statistics confirm.

(Source: Policy Advisor Brokerage)

However, the main reason they don’t want to purchase more coverage is that they don’t need more on top of what they already have (24%). This is followed by the inability to buy it online (20%). Additionally, around 18% think it’s too expensive, 8% don’t have an adviser they trust, and 7% don’t want to do a medical.


In Conclusion

Life insurance is an ideal option for Canadians who want to alleviate the financial risk to their loved ones of untimely or accidental death. The money beneficiaries can get is tax-free, allowing dependents to cover expenses and other needs.

So, it’s a good idea to get life insurance as early as possible because factors brought by age can make premiums more expensive. However, most Canadians are underinsured, as the latest Canadian life insurance statistics reveal.

At the end of the day, everyone should weigh the pros and cons and determine whether having insurance is worth it or not.

FAQ

What percent of the population has life insurance?

Although many consider life insurance in Canada essential, only 25% of Canadians have purchased individual insurance, while 38% are covered through their employer. Meanwhile, 27% have an individual insurance policy along with group insurance. The worrying aspect is the remaining 16% who do not have any insurance at all.

Is life insurance worth it in Canada?

Not all Canadians consider insurance as important, which is why many are still underinsured. However, those with dependents who will feel the most impact when they pass away definitely see the value of being insured. Besides, a healthy individual can often get life insurance for as little as $13 per month. So, it’s definitely worth it.

How big is the insurance industry in Canada?

The value of life insurance premiums written in Canada is around US$49.33 billion. Additionally, net premiums for P&C amounted to $55.82 billion, while net premiums for auto insurance stood at $24.19 billion.

What is the best life insurance in Canada?

Canadian life insurance statistics reveal that five companies lead the life insurance industry if calculated by assets. These are Manulife, Sun Life, Canada Life, Desjardins, and Industrial Alliance. However, it is worth noting that company size is just one aspect. At the end of the day, it all boils down to one’s primary needs – affordability vs. stability vs. financial strength, and so on.

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