New study highlights trends in Canadian term life insurance

Choosing a term life insurance policy is a balancing act: how much coverage do you need, who should benefit, and how long should the policy last?

If you’ve ever wondered how your choices compare to other Canadians, PolicyMe’s newly released 2026 study, Canadian Term Life Insurance: A Market Snapshot, provides some answers. The study analyzed over 18,000 customer interactions and highlighted coverage preferences, beneficiary choices, and generational health habits.

$500,000 is the sweet spot

Across age groups, $500,000 is the most commonly selected term life coverage. Younger Canadians (ages 18–44) also prefer longer terms (often 30 years), while older adults (45+) tend to select smaller coverage amounts and shorter terms.

The pattern is clear: life insurance needs mirror life stages. Young adults with mortgages, car loans, or growing families lean toward larger, longer policies. As financial obligations lessen with age, coverage amounts and terms decrease. Respondents over age 60 primarily chose term policies of just $100,000. It’s probably not surprising to see the term lengths diminish, too. After all, pensioners are more likely to be financially stable, and they aren’t looking for decades of coverage.

Women prioritize children while men prioritize partners

Nearly three-quarters of Canadians named a spouse or partner as their beneficiary. But gender differences emerge: 83% of men named a partner, compared to 66% of women, who were twice as likely to include their children as beneficiaries.

Ultimately, your beneficiaries are your choice—but understanding these trends can help you think through what matters most for your family.

Medical conditions are widespread among applicants

More than half of respondents reported having at least one medical condition. Mental health issues were most common among younger adults: 37.1% of those aged 18–29 reported a mental health condition, compared to just 3.8% of applicants over 60. Older respondents reported higher rates of diabetes and hypertension.

The data suggests younger generations are more transparent about health and mental wellness, which may influence coverage opportunities and policies as generations age.

The five most commonly reported medical conditions included allergy and immune disorders, diabetes, hypertension, breathing or respiratory conditions, and mental health conditions.

Drinking less, smoking more

Lifestyle habits also impact life insurance rates. The PolicyMe study found that Gen Z drinks far less than older Canadians, with just 1% reporting daily alcohol use (compared to 4.4% of those 60+)—but they consume more nicotine and cannabis.

7.3% of younger respondents reported using nicotine products in the past year, compared with 5.7% of those aged 30 and older. Cannabis use was even higher: 13% of Gen Z reported consuming it over the past year vs. just 4.8% of those over 60

Even vaping or occasional nicotine products can impact premiums. Understanding how lifestyle choices affect coverage costs can help you make smarter decisions when shopping for a policy.

Related reading: Do I really need life insurance?

The bottom line

Life insurance isn’t one-size-fits-all. It’s clear that Canadians value meaningful coverage, but the right policy depends on personal factors and your family’s financial needs. Being clear on your priorities can help you choose a policy that provides you and your loved ones with peace of mind.

Read more about life insurance:

• Term vs. permanent life insurance: How to choose what’s right for you
• How does age affect life insurance rates?
• Do retirees need life insurance?

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