Canadian Insurance Planning Guide: What to Buy, in What Order
This is the hub for the insurance cluster. The face amount is the life insurance need analysis. Term versus a policy that never expires is term versus whole life. What age does to a term premium, without a fake national rate card, is term life cost by age. How to compare two real term contracts is best term life insurance in Canada. The certificate at the mortgage signing is mortgage life versus term life.
- There is no single best Canadian insurance product in 2026. Premiums vary by person and insurer. This guide quotes no household premium.
- A long disability is the living risk. EI sickness in 2026 pays at most $729 a week for up to 26 weeks. CPP disability's 2026 maximum is $1,741.20 a month.
- Term life pays a death benefit for a stated term. FCAC describes that payment as tax-free. Permanent insurance is for a need that is still there late in life.
- Group coverage ends when you leave the plan. Lender mortgage life pays the lender and is optional. It is a different product from CMHC mortgage default insurance.
- If a life insurer fails, Assuris protects a death benefit up to $1,000,000 or 90 percent, whichever is higher.
What should you buy first?
Write the loss before you write the product. A household that can replace a paycheque from savings for a few months, and cannot replace it for two years, has a disability problem. A household whose survivor can pay the bills has a smaller life insurance problem than a slogan of "ten times salary" suggests. The stacking rule, including the duplicates, is shopping without over-insuring.
| Order | Loss | Start here | Leave it until later |
|---|---|---|---|
| 1 | You cannot work for months or years | Disability insurance, and the self-employed version if the draw is a business | A critical-illness lump sum. That cheque does not replace a monthly benefit. See critical illness. |
| 2 | Someone depends on your earnings, and the need ends | Personally owned term, sized in the need analysis, compared in the term feature test | Whole life bought to "build cash." The test for permanent coverage is term versus whole life. A corporation is a separate owner: corporate-owned life insurance. |
| 3 | A mortgage dies with you, or it does not | Put the mortgage inside the personal need, once. The lender's optional certificate is a different contract. | Buying the bank's mortgage life on top of a term policy that already includes the balance. That double count is the mortgage life comparison. |
| 4 | Drugs, dental, and vision the province does not fund | Private health and dental, after you check the Canadian Dental Care Plan test | A thin dental plan that makes you ineligible for the public dental plan. Travel care is a separate certificate: travel medical. |
| 5 | The car and the building | The mandatory auto layer where you live, then a home or tenant policy | Shopping the mandatory layer as if every province used the same insurer. The map is car insurance by province. The building is home and tenant gaps. |
Table as of September 2026. It is a sequence, not a quote.
Which loss is already partly covered?
Public programs and employer booklets are real, and they are narrow. Employment Insurance sickness benefits, on the ESDC page reviewed in September 2026, can run for up to 26 weeks at 55 percent of insurable earnings, to a maximum of $729 a week in 2026. The Canada Pension Plan disability benefit's maximum monthly amount for 2026 is $1,741.20, made up of a $610.46 basic amount plus an earnings-related portion. Those are ceilings for people who qualify. They are not an own-occupation plan you already own.
Group life and group disability exist only while the plan covers you. The portability question is group benefits versus personal coverage. A mortgage from a bank is underwritten in the Canadian mortgage guide. Optional life insurance sold beside that mortgage is not the default-insurance premium CMHC charges when the down payment is small. FCAC states the difference on its mortgage-life rights page.
What does Assuris cover if the insurer fails?
Assuris protects policyholders of member life and health insurers. On its term-life page, the death-benefit protection is up to $1,000,000 or 90 percent of the death benefit, whichever is higher. Its May 25, 2023 announcement of higher limits, still the schedule on the Assuris site in September 2026, also lists health-expense protection of $250,000 or 90 percent, monthly-income protection of $5,000 a month or 90 percent, and cash-value protection of $100,000 or 90 percent, each on a whichever-is-higher basis. Protection is not a reason to ignore the contract. It is a reason to buy from a member insurer and to understand that a very large benefit can be reduced to 90 percent in a failure.
Household A, in Halifax, has two salaries, a paid-off car, and a child in elementary school. The binding loss is the higher salary if that person cannot work. They read the disability guide, then size term life with the need analysis, and they do not add a lender mortgage certificate on top of a term face that already includes the mortgage. Household B is one incorporated consultant in Winnipeg. The corporation may own a policy later, which is the corporate-owned guide, after the personal disability contract and a personal term policy for the family are in place. The incorporation decision does not replace either contract. Neither household gets a premium from this page. Both get an order.
Where does each spoke go deeper?
- Term life cost by age — what moves a premium, and why a mixed age table lies.
- Best term life insurance — features to compare on two real quotes.
- Mortgage life versus term life — who is paid, and the declining balance.
- Disability insurance for the self-employed — EI, CPP, and a personal contract.
- Group versus personal — what ends when the job ends.
- Private health and dental — the dental-plan test, and Quebec's drug rule.
- Car insurance by province — public, private, and Quebec's split.
Frequently asked questions
What insurance should Canadians buy first in 2026?
Start with the loss that would force you to sell investments or borrow. For most workers that is a long disability, then term life if someone depends on earnings that end at a known date. Health, dental, home, and auto fill gaps the first two contracts do not touch. Skip a product that duplicates a loss you have already funded. The shopping guide is the duplicate check.
Is there a best life insurance company in Canada?
Not one this site will name. Premiums depend on age, health, smoking, term length, and face amount, and they differ by insurer. Compare the contract you were actually offered: guaranteed term, renewal, conversion, exclusions, owner, and beneficiary. Assuris protection applies if a member insurer fails. A blog score is not a policy.
Are life insurance premiums deductible in Canada?
Personal life insurance premiums are generally a personal expense, not a deduction on a T1. The death benefit FCAC describes is a tax-free payment to the beneficiary. Corporate-owned policies have their own tax file, including a capital dividend account credit, and premiums there are generally not deductible either. That file is the corporate-owned guide, not a reason to skip the personal need.
Does workplace insurance replace a personal policy?
Only while you remain in the plan, and only for the amount and definition in the booklet. Group life often ends on the last day of coverage, with a conversion window you must read in that booklet. Count it as a bridge. The long need belongs on a policy you own. The group-versus-personal page is the resignation case.
How much does term life insurance cost in Canada?
There is no national price. Canada Life publishes a handful of "about" monthly figures for its simplified term product, based on rates as of January 2026, and those examples use different ages, amounts, terms, and smoking statuses. They are not a rate card. Get two illustrations on the same face amount and the same term, and read the cost-by-age page before you compare them.
What is the difference between mortgage life insurance and mortgage default insurance?
Mortgage life insurance is optional coverage a lender may offer, and FCAC says the lender cannot require it as a condition of approving the mortgage. The benefit is aimed at the loan. Mortgage default insurance, including CMHC insurance when a down payment is under 20 percent, protects the lender against default. It does not pay your family. The mortgage guide covers the loan. This cluster covers the optional life certificate.
Sources
- FCAC: life insurance
- FCAC: mortgage life insurance rights
- ESDC: EI sickness benefit amount
- ESDC: CPP disability benefit amount
- Assuris: term life protection and the May 2023 protection levels
The policy is a contract. The tax return is the other file.
Who paid the premium changes the tax on some benefits. The 2026 tax guide is the filing companion, not an insurance offer.
Get the 2026 Tax Guide — $49 CAD
