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Life Insurance in Ontario: Things you need to know


Do you have in your mind questions regarding life insurance in Ontario? Here is a guide to help you answer those questions.


Among ten provinces in Canada, according to Britannica, Ontario is one of the largest provinces, second to Quebec. The city is also the most populated province in Canada, with more than one-third of Canada’s population. It borders the United States to the south, and Quebec and the province of Manitoba to the east and the west, respectively. Ontario has 52 cities overall, among which include Toronto, Ottawa, Oakville, and Mississauga.

Ontario’s strategic central locations, cheap power, large and skilled labor force, abundant natural resources and diversified transportation system, and general attractiveness to domestic and foreign investment make it the wealthiest province in Canada. According to the Ontario Ministry of Finance, its GDP as of Q1 2021 is $788,412 million.

Life insurance in Ontario: The rates

According to Insureye.com, average life insurance rates in Ontario can be demonstrated in the following chart:

Best Insurance Online - Life Insurance in Ontario Chart
Life Insurance in Ontario: Things you need to know 3

Overall, people spend from $50-$100 on average for monthly premiums. More people choose to buy universal life insurance than term life insurance. The maximum amount of premiums for universal life insurance policyholders is just about $200 each month.

The need to have life insurance in Ontario

Of all the reasons to buy life insurance in Canada, or in Ontario to be specific, the most common reasons are high consumer debts (including mortgages) and high funeral expenses. 

Given the position of Ontario as the leading economic institution of Canada, the cost of living and properties in Ontario is much higher in comparison to other provinces.

Best Insurance Online - Life insurance Ontario
Life Insurance in Ontario: Things you need to know 4

In particular, the cost of accommodation in Ontario is prohibitive, which means that people must pay for higher mortgages (see Table 1). As the mortgages are high, people have higher worries. For example, those who co-sign a mortgage share the same responsibility to pay for it. If one of them dies, the others still have to shoulder the debt of the deceased. Here is when life insurance comes to help cross out the debt of the one who passed away.

NoProvincesAverage House PricesMortgage rates
1British Columbia
7Nova Scotia$266,000188,267
8Prince Edward Island$243,000193,439
9Newfoundland/ Labrador$236,000186,268
10New Brunswick
Canadian Average

Table 1. Canadian Provinces Average House Prices and Mortgage Rates in Q1 2020 (Data taken from The Canadian Real Estate Association and CMHC-SCHL)

Finally, many people may know that the cost of final expenses in Ontario is exceedingly high. According to Ward Funeral Home, the average funeral expenses in Ontario ranges from $5,600 to $15,000. In Toronto’s Mount Pleasant Cemetery, casket burial ranges from $15,000 to $25,000, while a similar burial in neighboring Oakville is just around $3,000. 

Of all the benefits life insurance brings forth, the final expense coverage motivates people to take out a policy. We never wish to leave such a significant financial burden behind, making the unfortunate event even worse. Thus, having life insurance is a way to ensure our family and dependents have a safety net in case of our untimely passing.

To summarise, the reasons to get life insurance Ontario include:

  • Leave behind a safety net for your family members (kids, spouse, parents) should anything happen to you.
  • Make sure that your outstanding debt can be taken care of in the event of your disability or death. These can be outstanding mortgage payments, outstanding loans, and other debt. 
  • Prepare for final expenses so that you don’t leave your loved ones with unpaid final expenses.
  • Have a way of investment or savings: Some insurance companies offer insurance products (whole life insurance and universal life insurance) that have both insurance and a cash value. Some tax benefits are also included in life insurance, such as non-taxed distributions to the beneficiaries.

Life Insurance companies in Ontario

All powerhouses in the industry have their branches in Ontario. Three major life insurance Ontario companies include Sun Life, Canada Life, and Manulife. Apart from these, you can choose from mid-size companies such as Industrial Alliance, Wawanesa Life, La Capitale, FaithLife Financial, Canadian Protection Plan, Humania, Desjardins Life Insurance, SSQ Insurance, Primerica, Assumption Life, The Co-operators, Empire Life, Foresters, Ivari, etc.

You can also buy insurance from banks in Ontario. Some of these are RBC Insurance, CIBC Insurance, ScotiaLife Financial, and BMO Insurance. Of course, insurance is not the main product for banks, so many of them have more straightforward insurance products than those from Canada Life, Manulife, or Sun Life.

Other sources to buy life insurance are network-based providers such as Ontario Blue Cross or CAA Ontario.

In addition, there are also independent brokers (e.g., Bestinsuranceonline.ca), insurance brokerages (e.g., LSM Insurance), MGAs – managing general agents (e.g., Hub Financial), financial advisors, and planners, and many more.

Life Insurance Regulation Body in Ontario

There are two chief regulation bodies in Ontario that you to know:

1. Financial Services Commission of Ontario (FSCO)

FSCO was established under the Financial Services Commission of Ontario Act, 1997 (FSCO Act), with a legislative mandate set out in the FSCO Act. FSCO is a regulatory body in Ontario that regulates all matters related to life insurance. It licenses as well as regulates insurers in the province of Ontario to ensure law compliance. FSCO is accountable to the Minister of Finance.

Note: You can find out if a company is licensed or not through the FSCO portal.

2. The Registered Insurance Brokers of Ontario (RIBO)

 The Ontario government established RIBO in 1981 to protect the public during insurance transactions with brokers through self-governance. It regulates the licensing, ethical conduct, professional competence, and insurance-related financial obligations of all independent insurance brokers in the province. RIBO is accountable to the Minister of Finance.

Life Insurance types in Ontario

Like in any other province, there are three common types of insurance in Ontario for you to choose from: Term life insurance, Whole life insurance, and Universal life insurance. Each caters to different groups of clients with varying needs.

Insurance typesTerm insurance in OntarioWhole life insurance in OntarioUniversal life insurance in Ontario
Features– Lasts for a predetermined period (term)
– Cheap premiums in the short term
– No cash value
– Lasts permanently
– Expensive premiums in the short term
– Has a cash value
– Lasts permanently
– Expensive premiums in the short term
– Has cash value and/or dividends, depending on the type of your product
– More flexible than whole life insurance.

The above table describes, in brief, noteworthy features of the three types of insurance. Here on our websites, we offer articles that compare these three in detail.

Life Insurance categories in Ontario

Based on what is needed to apply for the policy, life insurance can be divided into three distinct categories as follows:

Traditional Life Insurance (also known as Standard Life Insurance): requires a medical exam/test conducted in person (e.g., by a nurse) and a lengthy medical questionnaire. To apply for this insurance, you need to go through an entire process of medical evaluation). Your premiums will be decided by many factors, among which is your health condition. The healthier you are, the lower the premium you have to pay.

Medically Underwritten Traditional Life Insurance without Exam: does not require a medical exam but a lengthy medical questionnaire. It is a subset of the previous insurance where an insurer believes there is no need to conduct a medical exam (e.g., lower coverage, younger age, better health).

No Medical Life Insurance: does not require any medical exam either with a short medical questionnaire containing 3-12 questions (simplified life insurance) or without a questionnaire (guaranteed life insurance). This option is the most expensive one and often with low coverage.

Life insurance in Ontario for people with pre-existing health conditions

Those with pre-existing health conditions, such as heart disease, type 1 diabetes, type 2 diabetes, cancer, HIV/AIDS, etc., can still qualify for life insurance in Ontario through no medical life insurance. 

Simplified issue life insurance for Ontarians

  • This insurance comes without a medical exam
  •  Applicants are required to answer a set of simple questions related to your health
  • Coverage ranges from $50,000 – $300,000

Guaranteed issue life insurance for Ontarians

  • This insurance type comes without any medical tests
  • There are no questions to answer
  • Coverage is low, with the maximum of $25,000

The bottom life

Since Ontario is the leading center for economic growth in Canada, having insurance to secure for the future is very high among Ontarians. When it comes to insurance, we always encourage our clients to buy as early as possible, as long as all requirements are met. If you live in Ontario and intend to purchase life insurance, contact us soon, we can lead you straight to where you need to be next. Just drop a message via the chat bubble in the right corner, via Contact page, or our email – hello@bestinsuranceonline.ca, we are happy to assist.

Frequently Asked Questions

In case I have a problem with my carrier, how can I bring up the issue to higher authorities?

If you feel that your insurer is treating your claim unfairly and you wish to resort to legal bodies, there are two ways for you to make an insurance complaint.

For the start, you can make a complaint with your insurance companies’ Ombuds service. First, you can find out your companies’ Complaint Officers and their contact information here. Next, you need to ask the complaint officer to give you a referral letter, which states your company’s final decision on your case. Following this, you write to the independent Ombuds service that you are referred to. You need to give a detailed description of your complaint and explain why you do not agree with your insurer’s position. Don’t forget to include the referral letter and other related documents. Once you have sent all the necessary documents to the Ombuds service, they will review your case and deliver the result to you later.

In case your problem is not solved, and you wish to continue to pursue your complaint, you can file a complaint with FSRA. The complaint form is available here for you to download and fill in.

Should I buy term life insurance or whole life insurance?

To answer this question, you need to analyse your personal needs as well as financial capacities.
Term life insurance is a cheap option in the short term. It gives your beneficiaries the death benefit should you die within the covered term. 

By contrast, whole life insurance is much more expensive. The policy is permanent, and beside death benefit, whole life insurance offers cash value – a savings element. You can use your cash value while your policy is in effect to pay for your personal needs.

Term life insurance may be cheap in the short term, however, by the time your current term ends, your health may not be as good, meaning that you may pay more for premiums. 

If you don’t have a lot of money and wish to have a safety net for your dependents, you may purchase term life insurance. However, if you can afford whole life insurance, in the long term, the policy may benefit you more. As your cash value has accumulated for several years, you can use it to pay for your premium.

For more information, you can read this article on our page.

What is the cost of term life insurance and whole life insurance in Ontario?

The cost of life insurance depends on a wide range of factors, namely: age, gender, place, smoking status, health status, etc. It also depends on the type of insurance and the amount of coverage that you wish to purchase. For you to understand, we will give you a table that shows the premium of a 10-year term life insurance and that of whole life insurance for a healthy person in his/her 30 in Ontario.



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