Life Insurance: Are Canadians Over Insured?

Posted on May 12, 2009 and updated July 3, 2014 in Life Insurance Canada News 4 min read

Canada is thought to be a conservative nation and part of conservatism is the prudent planning it takes to purchase life insurance, maybe that’s why 70% of Canadians have some sort of life insurance policy. While life insurance forms the backbone for most sound financial plans in Canada, we wondered if other nations around the world think so.

Below is a chart highlighting what percentage of a nations population has some sort of life insurance plan, whether that be group or individual:

  • U.S.:
82%Source: AXA Equitable
  • CAN:
70%Source: Insurance Canada
  • UK:
45%Source: Life Assurance Bureau
  • AUS:
25%Source: Austrailian Broadcasting Corporation
  • CHIN:

Source: Smart Money and

Interesting findings in putting together this chart include, the fact that over half a million people in the U.K. have canceled their life insurance policies in a bid to save money, which has contributed to pushing the number of policy holders below 50% across the nation. We were unable to confirm the number of cancellations in Canada, but as debt loads have increased in recent years, the need for life insurance has also increased exponentially. In most instances, life insurance should be the last to go when it comes to trimming the budget.

China’s percentage may be the lowest on the chart, but the life insurance market has grown rapidly over the last decade. In 1989, the total premum gross was $12 billion U.S., but by the year 2000, that figure had grown to 15 times that of 1989 to $20 billion U.S. The market is now dominated by life insurance, with China Life holding 45% of the market share and migrant workers being able to buy policies.

While a majority of Canadians have life insurance, many of them let their coverage lapse and do not update their coverage as their family grows or their financial situation changes.

In Australia, a study published in March 2009 revealed that some Australians were being denied life insurance based on their genetic makeup and scientists have been calling for genetic tests used by insurance companies to be re-evaluated.

While a majority of Canadians have life insurance, 61% let their coverage lapse and do not update their coverage as their family grows, or their financial situation changes. Part of prudent planning isn’t just buying life insurance, it’s also taking the time to update outdated plans. It’s worth investigating if you can get a lower rate on existing term policies. Term policies are those with premiums that increase as you get older, but the good news is that in many cases, term rates are down in excess of 30%.

You can get a free quote and compare for yourself at our Instant Quote Page.


Most people think they are overinsured until they get sick

LSM Insurance
LSM Insurance

You make a good point. its a sad reality many people do wait until they are sick to investigate life insurance. Options may be available at that point but they are certainly more limited and expensive.

LSM Insurance
LSM Insurance

Thanks for the note. The rates will depend on you gender, smoking status whether you are closer to 70 or 71 and the amount of coverage.

sher singh
sher singh

age,70 years
health.= A plus
please quote term ins.
20 years\