20-Pay Whole Life Insurance

Whole life’s 43% market share is significantly higher than universal life’s 28% and, in a lot of cases, it’s participating whole life’s investment component that consumers are attracted to.

Participating whole life gives consumers an investment opportunity to “participate” in the profits of the sponsoring insurance company. For example, Sun Life Financial reports that they have over 14 million participating policyholders, including 400,000 in the Sun Life Participating Account, which has $7.6 billion in assets.

Twenty-Pay Whole Life Insurance is a specific type of participating whole life policy where the premiums are paid-up in 20 years, but the insured is still covered beyond that. These policies are very popular with applicants who value guarantees.

Unfortunately, life insurance is trending towards non-guaranteed policies, as life insurance companies are struggling with increased reserve requirements and low interest rates. These factors are squeezing their profitability and forcing insurance companies to want to pass on the financial risk to consumer with adjustable permanent plans. For example, Empire Life has an adjustable term 100 policy, and Industrial Alliance has introduced a Universal Life policy with an adjustable cost of insurance option.


Whole life insurance offers lifetime protection, fixed premiums, and in the case of participating whole life insurance, a non-guaranteed dividend. This dividend usually takes the form of increased cash values or death benefits. Participating whole life policies have still been paying out very attractive yields (some in excess of 6%) given the state of long-term interest rates in Canada.

However, Empire Life effective Nov 24 2012 also decided to no longer offers it’s popular 20 Pay policy at the same time.

LSM Note: I thought this was a very well priced plan with excellent features and even bought my daughter this plan.

 However, some companies who remain committed to the 20 Pay market, including BMO Insurance, Indutsrial Alliance, SSQ, Western Life and Wawanessa Life. Be sure your broker is up to speed and has up to date software because pricing has been changing frequently and often with limited notice, since the insurance companies do not want a surge of new sales before an interest rate increase

For details on 20 Pay whole life insurance, call us at 1-866-899-4849 and visit our Whole Life Insurance Instant Quote Page.

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Ami Maishlish
Ami Maishlish

“Participating whole life gives consumers an investment opportunity to “participate” in the profits of the sponsoring insurance company.” Unlike stock shareholders who “participate” in the profits of the issuing company, purchasers of participating life insurance policies (be those policies “term”, “whole life” or whatever) do not “participate” in the profits of the sponsoring life insurance company. Rather, dividends on life insurance are a RETURN OF EXCESS PREMIUM collected – a refund of excess premium. A close analogy to that would be renting a car, and making a deposit for a little more than the expected rental fee. Then, when the… Read more »

LSM Insurance
LSM Insurance

Thanks for the note Ami. But the dividend rates paid on an insurance policy are influenced by interest rates and the profitability of the insurance carrier. An insurance company on the verge of bankruptcy is unlikely to have a very high dividend rate.