Guaranteed Issue Plans in Canada

Posted on November 8, 2016 and updated November 23, 2016 in Life Insurance Canada News, Non-medical, Whole Life 5 min read
guaranteed issue life insurance

Non-medical Life Insurance means you do not have to take any tests or visit a doctor for your application to be approved, however you may still have to answer some medical and lifestyle questions. There are two basic types of non-medical policies: Guaranteed Issue Coverage and Simplified Issue Coverage.

Guaranteed Issue Coverage

This type does not require you to answer any health or lifestyle questions or take any medical tests. You are covered immediately without going through the underwriting process. These plans are available to everyone, even if you have been declined insurance in the last two years.
The main purpose of a guaranteed issue life insurance policy is to cover funeral costs and other final expenses. In most cases the face amount is limited to $25,000 and if the insured person dies within the first two years of obtaining the policy, the death benefit is usually limited to a return of premiums paid plus interest. However, in the case of accidental death, the full amount is paid immediately.

The premiums for guaranteed-issue plans often the same for smokers and non smokers are significantly higher than simplified issue plans.

Simplified Issue Coverage

This type requires you to answer a series of health questions, the number of of questions often range from 3 to 30 health and lifestyle questions, but you don’t have to take any medical tests. As a general rule, the more questions the company asks, the lower the premium. These plans are usually not available to people that have been declined insurance in the last 2 years.

The face amounts can be up to $500,000. The insurance company has to set a maximum to cover potential losses. Without knowing your health history or how dangerous your lifestyle may be, the company is taking a huge risk because the chances of receiving a claim could be much greater than from a traditional policy.

Non-smokers receive a discount and the premiums are lower than guaranteed issue coverage.

3 Guaranteed Issue Plans in Canada

The guaranteed issue plans available in Canada are quite similar. Here’s a closer look at what you can expect to pay and what you get for your money.

The Edge Final Expense Plan

Benefits of the Edge Final Expense Plan

  • A non-smoking, 60 year old male can get a $25K policy for $145.77
  • A non-smoking, 60 year old female can get a $25K policy for $119.85
  • Insurance is available to anyone aged 18-85 and coverage extends to age 100
  • Acceptance is guaranteed
  • Coverage amount is available from $5K – $25K
  • Your premiums never go up, they stay the same for the life of the policy
  • Premiums paid are returned if a non-accidental death occurs within 24 months of policy issue.
  • In the case of accidental death, your beneficiary receives 4 times the benefit amount
  • Living Benefit – If you are diagnosed with a terminal illness with a prognosis of death within 12 months, you will be paid 50% of the benefit amount, provided the insurance has been in force for at least 2 full years at the time of diagnosis.

Specialty Life Final Expense Plan

Benefits of the Specialty Life Final Expense Plan

  • A non-smoking, 60 year old male can get a $25K policy for $103.60 (will go up every 5 years)
  • A non-smoking, 60 year old female can get a $25K policy for $69.80 (will go up every 5 years)
  • Insurance is available to anyone aged 18 and 74 inclusive
  • Acceptance is guaranteed
  • Coverage amount is available up to $25K
  • Premium increases every 5 years
  • Premiums paid are returned if a non-accidental death occurs within 24 months of policy issue.
  • Accidental death coverage is included at no extra cost, up to age 75. The policy pays out up to four times the stated coverage amount in the case of accidental death.

Canada Protection Plan – Guaranteed Acceptance

Benefits of the Canada Protection Plan – Guaranteed Acceptance

  • A non-smoking, 60 year old male can get a $25K policy for $156.47
  • A non-smoking, 60 year old female can get a $25K policy for $118.35
  • Insurance is available to anyone aged 18 – 75
  • Guaranteed acceptance with no medical exams and no questions
  • Coverage amount for people aged 18-60 is $10K to $25K and people aged 61-75 can get policies worth $5K to $25K
  • Your premiums never go up, they stay the same for the life of the policy
  • Premiums paid are returned if a non-accidental death occurs within 24 months.
  • Depending on your age, you may be eligible to purchase an Accidental Death Benefit worth up to 5 times the basic amount of your life insurance policy. There is an additional premium for this coverage. The company will pay the additional amount you chose if the cause of death is accidental, as outlined in your policy.
  • A Transportation Benefit that can help with the cost of transporting the deceased in the event the death occurs more than 200 kilometres from the principal residence of the insured.

Rates are current as of Oct 28, 2016 and subject to change without notice.

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