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Getting life insurance in British Columbia: the basics.

British Columbia is a beautiful place to live: the sea, the sky, the mountains. It’s a great place to raise a family, live, work and play. Having life insurance is another way to make sure your family is taken care of when you’re gone. If you’re on the fence about whether you need it, think of it as one less thing they’ll have to worry about after you’re gone. You won’t be alone, according to the Canadian Life and Health Insurance Association: 2.3 million B.C. residents have life insurance.

Life insurance is a policy that you take out that will pay out a lump sum to your beneficiaries when you die. The death benefit is tax-free and can be used to replace your income and provide for your partner and your children. When you buy life insurance, you pay premiums which is a charge for coverage. Your premiums are based on statistical data that looks at age, health (which is why you sometimes have to get a medical exam) and your life history. Your specific needs are measured against the data to calculate your premiums.

Term insurance is the most widely-held type of insurance policy in Canada.

Your questions about life insurance in British Columbia, answered.

What type of life insurance is available in British Columbia?

There are two types of life insurance available for residents in British Columbia: term and permanent. With term insurance, you’re essentially renting coverage for a set period of years ranging from five to 75 years. It’s a popular choice because it’s generally more affordable, especially if you buy it in your 20s and 30s. Term insurance is cheap when you’re young, but the premiums increase as you get older. With permanent life insurance, you’re buying lifelong insurance coverage. Premiums are higher, but they remain level in perpetuity. You’ll reach a point where you actually pay off the policy, kind of like a mortgage. Once you’ve paid it off, you still own it and are still insured. Permanents policies have a cash value, so you can take money out of policy, tax-free. One caveat is that doing this does reduce the value of your death benefit.

Life insurance providers in B.C. include:

  • Aviva
  • The Co-operators
  • Wawanesa
  • Belairdirect
  • TD Insurance

How much life insurance do you need in British Columbia?

Your location doesn’t directly impact how much your life insurance companies will charge you, so you can live by the water or in the mountains and be fine. Your health and age are still the biggest determinants.

However, your financial situation does indeed play a role in deciding how much life insurance you need to buy — and given that the high cost of living in British Columbia gained notoriety around the world, you might need to buy a bigger policy than someone living a less expensive province.

Since the death benefit is a tax-free lump sum that can be used to pay off debts and help your beneficiaries remain financially stable, you’ll need to pull together your finances and understand the average cost of living in your province when you’re deciding on a policy. If you’re trying to figure out how much insurance you’ll need, here are some numbers to consider:

  • The average property values in British Columbia are $684,140, with the Greater Vancouver area at $993,330 and Okanagan-Mainline at $510,600.
  • The average salary in the province is $47,100
  • Average debt levels in the province according to Statistics Canada: families in Victoria and Vancouver carry more than 200% of debt relative to their after-tax income.
  • Individuals living in B.C. carry an average of $268,000 in life insurance coverage.

How much does life insurance cost in British Columbia?

The province you live in may impact how much life insurance you need to buy. There really isn’t one standard rate for all British Columbians. To get an idea of how much you can expect to pay, you need to apply for a quote. However, we’ve created a persona to give you a rough estimate. Based on the following factors, here’s what life insurance might cost in B.C.:

Male, 30, non-smoker

Location: British Columbia

Coverage amount: $400,000

Term 30: $40 - $83 / month

Whole life: $220 - $340 / month

Female, 30, non-smoker

Location: British Columbia

Coverage amount: $400,000

Term 30: $29 - $70 / month

Whole life: $200 - $330 / month

What other factors might impact my life insurance rate in British Columbia?

After age and health, other factors that might affect your life insurance premiums include:

  • Whether you buy term insurance or perm insurance. Term insurance is usually the cheaper of the two.
  • If you have a high-risk profession like forestry or construction.
  • If you engage in extreme hobbies such as bungee jumping or heli-skiing.

How is life insurance regulated in British Columbia?

The life insurance industry in British Columbia doesn’t regulate life insurance the way it controls auto insurance. That means you’ll have to navigate multiple insurance companies when you start shopping for a policy. There is a list of approved insurers from the British Columbia Financial Institutions Commission. Also, there is the Insurance Council of British Columbia, which is a regulatory body that monitors and enforces ethical behaviour of insurance agents, adjusters and salespersons. The Insurance Council will also investigate any complaints made by the public about any life insurer.

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