Buying life insurance often goes hand in hand with the other responsibilities of adulthood. The amount of coverage can vary, but it’s a decision you must make based on your needs—and your budget. Here are some scenarios to help you test your insurance knowledge and find out everything you need know to save money while still getting the coverage you need.


Save on life insuranceCatherine and Frank are planning to start a family, but can’t agree on insurance: Catherine’s preference is permanent life insurance—often called whole life—while François is leaning toward term life insurance. Which is the best option for this young couple?

Term life insurance, which provides coverage at a fixed rate for a predetermined period (or “term”), is the ideal choice for people who have time-limited needs. Not only is it more economical, but it also provides better coverage if you have a mortgage loan to pay, or dependent children, or both. Unlike permanent life insurance, it has no cash value—but you can always take the money you save and invest it somewhere else.


True or false: paying off your premium in monthly instalments costs the same as making a single annual payment.

False. A monthly payment plan is convenient, as you’re less likely to forget and face the unpleasant consequences of being uninsured. It’s important to note, however, that administration fees may be added to the premium amount if you choose monthly instalments.

In the same vein, choosing a single policy for everyone in your family and bundling all your policies with the same insurer are excellent ways to cut administration fees to a minimum.


Steve is in good health, but he doesn’t like complicated forms, so he’d rather purchase guaranteed-issue life insurance. Is he making the right choice?

No. Guaranteed-issue life insurance, often much more costly, is designed for people with health issues who are having trouble finding an insurer. If you’re in good health, you’ll definitely save money by submitting to the questionnaire or medical exam required by the insurer. You’ll benefit from a larger coverage amount, or a more affordable premium, or both. Since age and health are significant factors when it comes to determining the premium amount, you are strongly advised to buy life insurance early in life (you can always increase the coverage amount as you get older and your needs change).


True or false: consumers have everything to gain by carefully choosing their insurance policy, because premium rates and coverage can change from one provider to another.

Absolutely true. It’s best to take the time to shop around for your insurance policy, comparing different insurers’ rates and products. You could save hundreds of dollars. A recent Ipsos survey showed, unfortunately, that only 35% of Quebecers bother to shop around for their financial products, although more than 60% of them do so when buying a flight or hotel1. When you shop on the Web, you’ll avoid having to deal with over-enthusiastic salespeople, and will be able to get several quotes so that you can make an informed choice.


Marianne lives in a rented apartment and doesn’t plan to have children. What kind of life insurance is best for her?

It all depends on her needs. There’s no point paying for a huge coverage amount if it doesn’t match your requirements. Do you plan to leave an inheritance to loved ones, or do you merely need to cover your debts and pay for your funeral? Do you have dependent children and a mortgage? Evaluate your budget along with your needs, both short- and long-term, to know which coverage you need to pay for. Note, however, that many insurers offer higher coverage amounts for a lower premium cost, so it’s best to ask for several quotes and get a complete picture. And make sure you won’t be paying twice for the same protection: check what coverage is included in your group insurance at work, if applicable, and choose only the extra protection required to fulfil your needs.


1. Ipsos, conducted for (July 2017). Canadians Love Comparing Flights and Hotels, But Not Financial Products. Visit file