How Age Affects Life Insurance Rates in Canada
How age affects life insurance rates in Canada. See what changes by decade and how to lock in premiums. For eligible applicants; subject to regulation.
On this page
- Key Takeaways
- How does age affect life insurance rates
- How insurance premiums rise with age
- Other factors that affect your life insurance
- At what age should you stop term life insurance?
- How does smoking affect life insurance rates?
- How age affects life insurance rates – Conclusion
- Frequently asked questions about life insurance premiums by age in Canada
How Age Affects Life Insurance Rates is simple but powerful: the younger and healthier you are, the less you pay. In Canada, insurers price premiums using actuarial data, medical history, and smoking status to estimate risk. Age amplifies that risk each year, which is why costs rise as birthdays pass. Term life can lock in level premiums for a set period, while permanent coverage adds lifelong protection and cash value.
This article explains how age flows through underwriting, why starting earlier matters, and what you can do at any stage to keep premiums in check.
How does age affect life insurance rates
Age affects life insurance rates by changing your risk class as you get older, which directly raises premiums. Each birthday increases the statistical likelihood of a claim, so insurers price coverage higher to reflect that rising risk. Age works alongside health, build (height/weight), and smoking status, but it is the most consistent driver after eligibility.
In Canada, underwriters begin with age-based mortality tables, then adjust for medical history, prescriptions, family history of early cardiac events or cancer, and lifestyle factors. A healthy 30-year-old non-smoker may qualify for preferred or elite classes with low rates. The same person at 45 often lands in a higher class at a higher price, even with identical health, simply because more risk is attached to the extra years.
Product type matters too. Level-term policies price in your age at purchase and keep premiums fixed for 10, 20, or 30 years. Renewal after the term usually jumps sharply because it reprices at your then-current age. Permanent policies (whole or universal) also bake in age but spread costs over life; premiums are higher than term at the start, trading today’s dollars for lifelong coverage and potential cash value.
You can counter age-driven increases by applying earlier, choosing a term length that spans your highest-need years, maintaining non-smoker status, improving BMI and labs, and asking for a reconsideration or new quote if your health improves. All coverage remains subject to underwriting and provincial regulation.
How insurance premiums rise with age
The same $250,000 policy at three ages
Life insurance premiums increase for every year you become older. This is because younger people are typically in better health and have a lower risk of death than older individuals. So, the lower the risk, the lower the premium. Many people secure term life insurance policies earlier in life to take advantage of lower premiums before they age.
However, as you age, your health can begin to decline, which raises your risk of death. Insurance companies account for this by charging higher premiums to older people. Coverage for people in their 20s is relatively cheap because they’re considered low-risk. Rates start to go up when people hit their 30s because that’s when they’re considered to be in their prime years and are more likely to experience an unexpected death. Premiums continue to increase as policyholders age because the risk of death also goes up as we get older. Younger applicants often require only a health questionnaire for approval, while older applicants face more rigorous medical exams.
Term life insurance rates are determined when you buy your life insurance policy, so your rates are fixed until the end of the policy. On the other hand, whole life insurance policies change the rate throughout the term of the life insurance policy. Individuals can sometimes convert term life insurance into whole life insurance when the term ends without needing a medical exam.
Other factors that affect your life insurance
In addition to age, life insurance cost is impacted by other factors such as:
- gender
- medical history
- smoking status
- occupation
- family health history
- hobbies
- poor driving record
- high blood pressure.
When you apply for life insurance coverage, you will complete an application that includes a medical history questionnaire and, in many cases, a medical exam. Both will provide information about health conditions and other personal factors determining your health status and risk for rating purposes.
Once the insurance application is completed, it will be submitted to underwriting along with the medical exam results. Life insurance products are priced according to the company’s risk assessment, which is determined when they underwrite the application.
At what age should you stop term life insurance?
Term life insurance has an expiry date, permanent doesn't
When you should stop carrying life insurance depends on your specific situation. Whether you have term or permanent life insurance will be based on your needs and financial plans. Most people think they no longer need life insurance once their policy expires, but that’s not always true.
If you have young children or other dependents who rely on your income, it’s important to have coverage in place in case of your death. As your children grow up and become financially independent, you may no longer need (or be able to afford) such extensive coverage.
The same goes for your career. If you’re nearing retirement age and have ample savings, you may not need life insurance anymore since your family will no longer rely on your income. However, if you’re still working and don’t have as much saved up, keeping your coverage in place in case something happens to you is important.
The average life insurance cost does increase with every year of age, so start early and plan on keeping some form of coverage for the duration of your life.
The age you should stop term life insurance depends on your specific situation. Whether you have term or permanent life insurance will be based on your needs and financial plans. Most people think they no longer need life insurance once their policy expires, but that’s not always true.
If you have young children or other dependents who rely on your income, it’s important to have coverage in place in case of your death. As your children grow up and become financially independent, you may no longer need (or be able to afford) such extensive coverage.
The same goes for your career. If you’re nearing retirement age and have ample savings, you may not need life insurance anymore since your family will no longer rely on your income. However, if you’re still working and don’t have as much saved up, keeping your coverage in place in case something happens to you is important.
The average life insurance cost does increase with every year of age, so start early and plan on keeping some form of coverage for the duration of your life.
How does smoking affect life insurance rates?
Smoking affects life insurance rates because it pushes you into a smoker class with substantially higher premiums. In many cases, smoker rates range from 50 percent to 200 percent higher than comparable non-smoker classes, reflecting elevated risks of cancer, heart disease, and respiratory illness. Vaping and nicotine replacement may also be classified as smoker depending on the insurer’s rules.
There’s good news. If you quit all nicotine for 12 months or more (some carriers require 24 months), you may qualify for non-smoker rates on new coverage or through a reconsideration where allowed. Underwriters also look at frequency, cotinine test results, and other health markers like BMI, blood pressure, and A1C. Quitting, improving fitness, and maintaining routine care can materially cut premiums. Be accurate on applications; misrepresentation risks claims and can void coverage during the contestability period. All outcomes are subject to underwriting.
How age affects life insurance rates – Conclusion
Buying a life insurance policy is more affordable when you are young. Life insurance policies are rated based on factors that determine life insurance costs, which differ from the life insurance premiums you quoted. Permanent life insurance policies have two components that make up the premium you are charged: the cost to insure and the cash value component.
The older you are, the higher the life insurance cost becomes. Term life insurance rates start to become more attractive if you shop for insurance after about 40 years of age. If you are in good health, that will help secure affordable life insurance rates in your older years.
Frequently asked questions about life insurance premiums by age in Canada
As you age, what happens to the cost of life insurance?
The cost of life insurance goes up every year you age. Life insurance carriers use standardized actuarial life expectancy tables to determine the cost of life insurance.
Life insurance companies know that health issues are more likely to occur as you age. Therefore, it is advantageous to maintain good health and get lower life insurance premiums.
You can purchase a policy with level premiums to lower your life insurance costs. This means that your premium will remain the same throughout the life of the policy, regardless of how old you are when the policy is in force. Another way to offset the increased cost of life insurance as you age is to purchase a policy with increasing benefits. This type of policy provides an increasing death benefit as you age, which can help keep pace with the rising cost of living. By strategically assessing your short- and long-term needs, you can get adequate coverage and pay more affordable premiums.
Is there life insurance where premiums do not increase with age?
Yes, suppose you buy a level-premium term life insurance policy. In that case, the life insurance premium when you purchase the policy will remain the same for the duration of the term.
Why does age matter in life insurance?
Age makes a difference in insurance because of the life expectancy factor. The older you become, life insurers determine there is an increased likelihood that they will have to pay out on the policy. That’s why you can expect to pay higher life insurance rates as you age.
Does life insurance decrease with age?
When you buy a life insurance product, you will purchase a fixed amount of death coverage. The death benefit will not decrease throughout the term, especially in permanent life policies such as universal and whole life insurance.
Some term life insurance policies do have declining coverage. Decreasing term insurance, for example, does reduce the coverage amount with age.
Is life insurance worth it after 75?
Life insurance coverage is worth having at any age. When you purchase life insurance, you purchase more than a death benefit. You are purchasing financial protection for a variety of needs or purposes. Some form of term life insurance coverage will always come in handy, even if just to pay final expenses at the end of life.
Can a 90-year-old get life insurance?
Yes, seniors over the age of 90 can qualify for life insurance from various companies. How much life insurance premiums are will depend on the typical age and health factors. You can expect to pay substantially higher premiums for the same coverage at this age than you would pay at a younger age.
Does life insurance end at age 70?
Life insurance does not end at 70. Many life insurance companies still offer permanent and term life insurance at age 70 and beyond.
What is the oldest age at which you can buy life insurance?
Applicants up to the age of 90 can find a life insurance company to offer coverage. However, the death benefit amount may be limited, and the monthly premiums may be costly. Therefore, this is when you consider getting multiple life insurance quotes and shopping for the lowest life insurance cost.
The good news is that even at an advanced age, you can find permanent life insurance as well as term life insurance.
What happens to whole life insurance at age 100?
A whole life insurance policy matures when the insured turns 100. The life insurance company considers the life insurance policy paid up. At this point, the life insurance company may pay out the death benefit to the beneficiary and close out the policy.
Two things happen here: life insurance is terminated, and so is the ability to transfer the death benefit tax-free; this is now a taxable event.
It would be prudent to have a strategy to mitigate the taxable event that will take place with the life insurance policy ending and the death benefit paid out.
Can I be denied life insurance because of my age?
Yes, unfortunately, there comes a time when life expectancy becomes an issue for life insurance providers. After the age of 90, you cannot purchase life insurance in most cases.
Sources:
- Statistics Canada, “Life Tables, Canada, Provinces and Territories 2024”
- Statistics Canada, “The Daily, Deaths, 2022”
