How to Get Life Insurance as a Newcomer to Canada

3 minutes can save you hundreds. Enter your age below and join thousands of Canadians saving on insurance.

Secure. No Spam. No Fees.

Why You Can Trust MyChoice

MyChoice serves as an independent intermediary between you, financial institutions and licensed professionals without any additional charge to our users. In the interest of transparency, we disclose that we partner with some of the providers we write about – we also list many financial services without any financial gain. MyChoice does not operate a financial institution or brokerage and to ensure accuracy, our content is reviewed by licensed professionals. Our unique position means that we hold no recurring stake in your policy, ensuring our mission to help Canadians make better financial decisions is free of bias or discrimination. 

Article Contents
Picture of By <span>Matthew Roberts</span>
By Matthew Roberts

Updated on January 8, 2025

Visit author page
Picture of By <span>Matthew Roberts</span>
By Matthew Roberts

Updated January 8, 2025

Visit author page

4 minute read

Article Contents

Going through life in a new country comes with many challenges, and one of these challenges is setting up a financial plan. One important aspect of financial planning is life insurance, which can help keep loved ones safe from financial burdens in case of an untimely death.

Can newcomers get life insurance in Canada? Is it worth it to get life insurance if you’re a temporary resident? Read on to learn about why newcomers should get life insurance in Canada.

Life Insurance for Newcomers at a Glance

  • Newcomers to Canada can purchase life insurance but with specific limits and types depending on whether they permanently reside in Canada or not.
  • Life insurance is particularly beneficial to newcomer families with only one primary breadwinner, as it provides a solid safety net in case of their unfortunate passing.
  • Some types of newcomers will need to provide additional documents and may need to reside in Canada for a specific time period before becoming eligible for life insurance.

Understanding Life Insurance for Newcomers to Canada

Life insurance is a contract between an individual and an insurance provider that guarantees a death benefit to the policyholder’s beneficiaries upon their death. This financial safety net can cover various expenses, such as funeral costs and outstanding debts, and provide ongoing support for dependents.

While purchasing a life insurance policy may seem like a big expense, it’s important for newcomers to secure their loved ones’ financial future in case of their passing. As a newcomer to Canada, a life insurance policy will give you peace of mind, knowing that your family will be taken care of if something happens to you.

Are Newcomers Eligible for Life Insurance in Canada?

In Canada, a newcomer typically refers to anyone who has arrived in the country within the last five years. This includes permanent residents, temporary residents (such as foreign workers and international students), and refugees. Each category  has different eligibility criteria for life insurance:

These individuals have the same rights as Canadian citizens regarding life insurance eligibility. They can apply for any type of policy without restrictions.

This group includes individuals on work permits or student visas. While they can also obtain life insurance, many insurers may impose waiting periods or coverage limits.

Individuals living outside Canada may face more restrictions and generally have limited access to coverage options.

Are Newcomers Eligible for Life Insurance in Canada

Types of Life Insurance Available for Newcomers

There are two primary types of insurance in Canada: term life insurance and whole life insurance. Term life insurance provides coverage for a specific period – typically between 10 and 30 years. It is typically more affordable and does not accumulate cash value. On the other hand, whole life insurance offers lifelong coverage and includes an investment component that builds cash value over time. Premiums for whole life policies are generally higher than term policies.

Coverage Amounts and Eligibility for Newcomers

Each category of newcomer has a specific amount of life insurance coverage that can be purchased. Some categories also have restrictions on what kind of policies are available to them.

Permanent residents can access a wide range of life insurance products without restrictions. They can choose between term and whole life policies based on their financial needs and goals. Permanent residents can obtain coverage up to $5 million, similar to a regular Canadian citizen.

Work permit holders can often secure up to $500,000 in term life insurance. However, they may need to demonstrate stable employment and residency in Canada for several months before applying, and may not be eligible to purchase additional riders. Some insurers may require medical examinations depending on the applicant’s health status. To purchase a life insurance policy as a work permit holder, you’ll need to provide the following documents:

  • Copy of your work permit
  • Copy of your employment contract
  • Copy of your immigration documents

International students are only eligible for term life insurance and can only get up to $250,000 in coverage for undergrad programs and $500,000 for post-graduate programs. Much like work permit holders, international students may need to wait up to six months before insurance companies will consider allowing them to purchase life insurance, and they may not be allowed to purchase additional riders. To purchase a life insurance policy as an international student, you’ll need the following:

  • Proof that you’re enrolled in a full-time study program, taking at least three to five courses per semester
  • Proof of your duration of stay
  • Confirmation that you don’t intend to live in an ineligible country in the next 12 months
  • Confirmation that have not lived in an ineligible country in the last 12 months

Convention refugees can obtain term life insurance with up to $250,000 in coverage. However, they might encounter specific requirements based on their unique circumstances. Depending on the insurance company, refugees may need to wait between six months and two years before being considered eligible for a life insurance policy. In addition, many insurance companies will ask for the following:

  • Proof of a stable living environment
  • Proof of legitimate employment
  • Documents from the Immigration and Refugee Board of Canada and Citizenship and Immigration Canada verifying convention refugee status

Financial Considerations

Taking out life insurance means paying for a monthly or yearly premium. This insurance rate is determined by a few factors:

Age:

Younger applicants usually pay lower premiums. Getting a life insurance policy while under the age of 30 generally results in the lowest premiums.

Health Status:

Pre-existing conditions or past medical procedures can lead to higher rates or exclusions.

Lifestyle Choices:

Smokers or those with risky hobbies or professions may face increased costs, while those with a risk-averse lifestyle will generally get lower premiums.

Coverage Amount:

Higher coverage amounts typically result in higher premiums.

Type of Life Insurance:

Term life insurance is generally cheaper than whole or universal life insurance.

On average, newcomers can expect to pay between $10 to $70 per month for life insurance coverage. However, these costs can vary widely based on individual circumstances and insurer policies. For example, a healthy young adult might pay approximately $10 per month for a term policy providing $100,000 in coverage over ten years. On the other hand, an elderly person with a whole life policy of $1,000,000  will pay significantly more due to the risk calculated by the insurance company.

Key Advice from MyChoice

  • Newcomers to Canada who are not permanent residents can only take out term life insurance policies with specific coverage limits. Permanent residents face no restrictions on what kind of policy they can purchase.
  • If you’re unsure of how much coverage you need, use a life insurance coverage calculator to determine the right amount of coverage for your situation.
  • Make sure to have any relevant documents ready when applying for a life insurance policy to minimize delays.

Congratulations! You made it to the end!

Now, here is the easy part: complete your quote in under 2 minutes
  • Secure. No Spam. No Fees.

Discover More About

Process of Looking Up Someone’s Life Insurance Records

Your loved one’s life insurance benefit can help lighten your burden after their passing. Learn how to find out if they had a policy and what you can do with it.
Read full article

Navigating Life Insurance in High Interest Rate Environment

You can benefit from higher interest rates because many life insurance policies have higher yields. Visit our article to learn more.
Read full article

Renewable vs Convertible Term Life Insurance

Should you get renewable or convertible term life insurance? Or should you get both? Visit our article to learn what options suits you best.
Read full article

Even More Ways To Save