What is the Best Way to Buy Life Insurance in Canada?

life insurance by Michael P
Don't bother with call centres,
get a broker working for you.

From all forms of communication available, Canadians are constantly bombarded with seemingly endless pitches to buy life insurance. Be it by phone, by mail, in-person, or online, it all begins to look the same. That's why when you're finally ready to buy a policy, it can be difficult to discern not just what life insurance policy to buy -- but the means you should use to buy it.

The following will hopefully help you seperate the wheat from the chaff when it comes to the best route for buying your life insurance policy:

Online - Many major insurance companies allow you to buy your policy online. At first glance, this may seem like an excellent option because, after all, you avoid the middleman and are buying direct.

The reality is the insurance companies charge the same premium, whether you buy online or through a broker.

Worse, you are stuck when it comes to service-related issues or deeper explanations of the different features and provisions of your policy. There is no in-person point-of-contact. Buying online will only give you access to a limited number of plans available through that insurance provider because most companies only sell term insurance online.  If your needs are better suited by permanent insurance, you're pretty much out of luck.

Via Call Centre - Buying over the phone carries the same pitfalls as buying online. The applicant is left without a go-to person if they have questions, or something goes wrong. In addition, most call centres only sell policies from one particular company. Insurance premiums often vary sharply from company to company, so making a purchase decision based on a single company may result in you overpaying by 20-30%.

Special Mail-Out - Many insurance carriers offer special accidental death packages by mail. However, the only special attribute they carry is the ability to seperate you from your hard earned money without it being very likely that you'll ever be able to claim on the policy. This is because accidental death is very rare, having a mortality rate of only 5%. Besides that, accidental death insurance usually costs more than a term life policy that will cover you no matter how you die. Just in case you're still uncertain, a 2007 Money Sense Magazine article further illustrates why I think accidental death insurance makes no sense, and truly impractical for the average potential policy holder.

Captive Agents - These are insurance advisors who just offer products from a single carrier. The premiums charged by captive agents are often much higher than those offered by independent brokers and captive agents are truly handcuffed because they generally only have access to a limited number of plans. Check out this video -- part of our Life Insurance Risks series -- where I use my ten years of experience working in a captive environment to uncover other truths about captive agents you may be unaware of as a consumer. 

Independent Brokers - An independent insurance broker has access to a full menu of insurance plans. Unlike captive agents, they are 100% free to shop the market and get you the best rate. Of course, before you deal with any independent broker, you need to verify that they do in fact have access to a wide array of insurance companies and not just two or three. You also should ask about his/her experience in the industry, credentials and be sure to get references/testimonials from existing clients.

Rest assured that LSM advisors are completely independent and have access to over 15 unique insurance carriers. Best of all, you can browse our website's full library of articles covering virtually every life insurance issue. You can also get a free instant quote at our variety of Instant Quote Pages with absolutely no obligation. When you are ready to meet with a broker, we can connect you with a qualified advisor who will assist you, in a no-pressure environment, with a plan best suited to your indvidual needs.

You can call us at 1.866.899.4849 for more details on our services, or the pitfalls hilighted here.

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life insurance testimonialsI am very pleased with the plan LSM Insurance set up for me. It's...1 of 84Arthur BalaniukRead more

22 Comments

  1. Michael P 03/29/2010 at 8:24 pm

    Hello,

    I am interested in purchasing life insurance for myself and my wife. Please contact me at my email address ……..

    Thank you,
    Michael P

  2. LSM Insurance 03/31/2010 at 12:04 pm

    Hi Michael,

    Thanks for the note we are happy to assist, I have sent you an email. All the best!

  3. Nate 04/07/2010 at 4:30 pm

    I’m looking to buy life insurance young (I’m 21 y/o, in good health, non-smoker, etc) in order to get good rates. Is this a good idea? What kind of insurance should I get and where should I ‘shop’ for insurance? Any advice would be much appreciated.

  4. LSM Insurance 04/08/2010 at 12:38 pm

    Thanks for the note. The best type of plan depends on your need. If you want to lock in at a low rate you should likely be loooking at a permanent policy. I will send you a separate email with more details. Regards …

  5. mercy 03/22/2011 at 6:03 pm

    hi,
    we are a young family who’s been thinking of getting a joint life insurance. I am not sure where to start or which policy will be suitable for us. I don’t smoke, my husband does but we are generally healthy individuals. We don’t have a mortgage yet but are working towards that goal. CAn you help us regarding to which policy will be suitable for us?

  6. LSM Insurance 03/22/2011 at 6:53 pm

    Thanks for the note. We are happy to help out. The rates will depend on your ages, type of plan and the fac amount. We will send a separate email now. Regards,

  7. Diana 06/19/2011 at 5:52 pm

    for an international student in Canada, his/her parents are in other countries, could his/her parents the beneficiary be if she buy life insurance? How much it takes with taking out $200,000 covering 4 years (during learning in Toronto from 18 to 22-year-old) if he/she want to buy a normal life insurance policy?
    Thanks and with best regards!

  8. LSM Insurance 06/19/2011 at 6:55 pm

    To buy a life insurance policy in Canada the insured has be residing in Canada. Insurance companies having different protocols regarding Citizenship status. The policy owner can name a beneficary outside of Canada if there is an insurable interest.

  9. richard 08/23/2011 at 3:57 pm

    I am interested in purchasing term life insurance for myself and my wife. Please contact me at my email address.

  10. LSM Insurance 08/23/2011 at 4:44 pm

    Hi Richard,

    Thanks for the note the premiums will depend on your ages, smoking status, length of term and amount of coverage.

    We wil send you a separate email now. Regards,

  11. Tammy 10/06/2011 at 11:47 am

    Hi there I am currently looking at purchasing life insurance for both my husband and myself. I am a 41 yr old female, smoker, my husband is a 51 yr old smoker. Both in good health. We have a 11 yr old son. Looking at approx $250.000 coverage each. Do all life insurance plans cover critical illness and disability? Do not know the difference between term life etc. Your help would be greatly appreciated.
    Thanks
    Tammy

  12. LSM Insurance 10/06/2011 at 3:14 pm

    Thanks for the note Tammy. No life insurance plans do not include Critical Illness and Disability insurance but you can add this as a rider.

    We will send you a separate email now with more details.

  13. Linda 02/20/2012 at 2:31 pm

    I am 60 and would like to retire early, cannot afford a huge monthly insurance bill,would like to make sure there is money there to cover expenses and some left for my grandkids. i have no medical issues and need some advice on what would be a good policy for me to purchase at my age.
    Thank you
    Linda

  14. LSM Insurance 02/20/2012 at 3:06 pm

    Thanks for the note Linda. The premiums will depend on the type of plan. Term plans start off lower in cost and increase as the insured gets older. Permanent plans start off higher in cost and generally remain level for the insured’s lifetime.

    We will email you more details.

  15. Denise 03/02/2012 at 6:41 pm

    My husband and I are looking to purchase life insurance. He is 50 and I am 48, both non-smokers. Not sure whether we should do permanent or term and who to go with.

  16. LSM Insurance 03/02/2012 at 7:17 pm

    Thanks – Term policies start off lower cost and go up as you get older and Permanent are more expensive initially but generally do not increase in cost. We will send you a separate email now.

  17. Tina 03/09/2012 at 1:46 pm

    Hello, my partner and I are 50 and 46, and need life insurance, we are a mid income couple. Please help!

  18. LSM Insurance 03/09/2012 at 2:27 pm

    Thanks Tina. The premiums will depend on your smoking status,type of plan and the amount of coverage. We will send you a separate email now.

  19. Gershon 07/22/2012 at 10:11 pm

    Hello, I am looking to buy life insurance. I would like to get permanent insurance for me. I am … years of age, in good health non-smoker/drinker. I would like to get an advice where I can “shop” for insurance in hoping to find good rates. Also, whether permanent insurance is the way to go. Thanks and much appreciated.

  20. LSM Insurance 07/23/2012 at 11:20 am

    Thanks for the note. The rates will depend on the type of Permanent plan and the amount of coverage.

    We will be in touch very soon.

  21. girlie 03/02/2013 at 10:24 pm

    Hi i am 30 non smoker single healthy female with 12k personal debt(that’s including my student loan and credit card), 400k mortgage, aging parents and a dependent sibling and i have no savings. what is the best insurance for me? i am thinking of getting some term and some whole life. but i don’t know if that works for my situation. i also want to pay 75 or less premium a month. i don’t think i can afford to pay more because everyday expenses of my family depend on me. i took the test about how much insurance i need and it came to 721k. please help. thank you very much.

  22. LSM Insurance 03/03/2013 at 11:48 am

    Thanks Girlie. We look forward to helping out and will be in touch by email with some quotes within your budget.

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