Making the decision to purchase life insurance means finding the right life insurance product that fits your lifestyle and need. Luckily, there are many options to choose from. A good starting point in determining the type of life insurance that's best suited for you is to figure out how long you're likely to need it.

Term 10 life insurance

Term insurance is intended to cover relatively short-term insurance needs. If you believe your need for life insurance is between 12 - 14 years, a traditional Term 10 life insurance policy that is renewable and convertible is your most cost effective option. This coverage is best suited for those who have teenage children and/or a mortgage on a home or vacation property that is well under control yet still needs protecting.

Term 10 life insurance is the most popular term insurance representing about 70 to 75 per cent of all term insurance sales in Canada. A Term 10 life insurance policy:

  • Offers an initial 10-year term premium that is fully guaranteed (that means your premium will not change over the 10 years)
  • Can be renewed when the initial 10-year term is over for an additional 10-year period
  • Is renewable until age 80 or 85 for most companies

Term 20 life insurance

Term 20 life insurance is similar to Term 10. You still have guaranteed premium levels, but the term of coverage is for a longer period of time. The Term 20 life insurance policy is well suited for people with young families and/or new mortgages where:

  • The insurance need is at least 15 years
  • Level premium rates are desired for at least a 20-year term
  • Is renewable until age 80 or 85 for most companies

Term 30 life insurance

Term 30 life insurance offers guaranteed premium levels, but for 30 years rather than 10 or 20.

  • The insurance need is at least 25 years
  • Level premium rates are desired for at least a 30-year term
  • Is renewable until age 100 for many companies
One of the attractive features of the Term 10, Term 20 and Term 30 life insurance policies is that it can be issued on a joint first-to-die basis. This option allows two people - usually spouses - to be insured under one contract with the full value of the insurance paid out on the death of the first spouse.

Insurance for a lifetime - Term to 100

While both Term 10, 20 and 30 life insurance policies offer protection for the short to mid-term, many people require insurance that lasts a lifetime. As a result, many companies now offer a Term to 100 life insurance plan.

Term to 100 is different from the Term 10, 20 and Term 30 life insurance policy. In fact, the duration of the plan will vary from person to person. Instead, this policy will insure the holder until age 100 - or for life, whichever comes first. Term to 100 plans are best suited for people aged 50-55 because they:

  • Have a level premium for the life of the contract
  • Are automatically renewed each year until you turn 100 as the contract does not have a pre-determined expiry date
  • Are generally more affordable than permanent insurance as the cash value components of these plans are costly

More life insurance help

For more information, click on the Kanetix Life Insurance Needs Calculator to get an estimate of how much life insurance coverage you might need.

Compare life insurance quotes on Kanetix.

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