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Term 40 Life Insurance in Canada

Term 40 Life Insurance in Canada
Term 40 Life Insurance in Canada

Term 40 life insurance provides longer-lasting coverage than typical 10 or 20 year policies. But is this extended term length right for Canadian policyholders? This guide examines everything about Term 40 insurance, from costs to leading carriers.

Overview of Term 40 Life Insurance

Term 40 life insurance is a variety of term life policies tailored for long-range needs spanning 30+ years. It delivers an affordable death benefit and predictable premiums for up to 40 years.

Like other terms, it offers no cash value. But the coverage can continue far into retirement through renewal options. Converting to permanent insurance is also available. This flexibility aids lifecycle planning.

In Canada, few insurers provide Term 40 coverage. The niche market contains big names like Industrial Alliance insurance, RBC Insurance, and Canada Life.

Ideal buyers are young families and business owners with debts and income replacement needs beyond 20 or 30 years. But lengthier terms also mean pricier premiums.

Below, we’ll explore everything Canadians should know about Term 40 insurance, from costs to alternatives.

How Term 40 Life Insurance Works in Canada

How Term 40 Life Insurance Works
How Term 40 Life Insurance Works

Term 40 life insurance works similarly to other term lengths, just with an extended coverage timeframe.

  • The policyholder pays annual or monthly premiums to maintain coverage.
  • The death benefit amount remains at a level of 40 years.
  • At the end of the term, the policyholder can renew coverage at much higher rates.
  • Many policies allow converting to permanent life insurance like whole life insurance.
  • Premiums and death benefits stay consistent over the 40-year term.

Term 40 suits buyers wanting high coverage for mortgages, debts, or income lasting beyond 30 years. It offers stability to ages 65, 75 or 85.

Term 40 Premiums and Costs in Canada

For Canadians, premiums on Term 40 insurance depend on:

Age – Rates rise steadily with age. Buying earlier saves substantially.

Gender – Women pay 10-20% less than men on average.

Health – Good health reduces premiums. Medical issues or pre-existing health conditions increase costs.

Smoking – Smoker rates are 2-3X higher than non-smoker rates.

Coverage Amount – More coverage means higher premiums.

Here are sample Term 40 rates for a 30-year-old non-smoking male in excellent health:

Coverage AmountMonthly Premium

A female of the same age and profile would pay approximately 15% less.

Rates remain consistent for the entire 40-year term. However, renewal premiums after year 40 have become exponentially more expensive.

Read more: Strategies for Lowering Your Term Life Rates

Maximum Term Lengths by Age

In Canada, the maximum term length available shortens as the applicant ages:

Applicant AgeMaximum Term Length
30Term 40
40Term 35
50Term 25
60Term 15

So, older applicants may be limited to Term 20 or Term 30 at best. Choosing a term that is too lengthy can waste premium dollars.

Leading Term 40 Insurance Providers in Canada

Leading Term 40 Insurance Providers in Canada
life buzz quote in canada new 8 1
Leading Term 40 Insurance Providers in Canada

Only select Canadian life insurers offer Term 40 insurance. Notable options include:

  • Industrial Alliance – Term 40 coverage via “Pick-a-Term” policies from 10 to 40 years. Renewable annually to age 85.
  • RBC Life Insurance – Term 40 plans with renewable and convertible options. Strong policy features.
  • Canada Life – Known for flexible Term 40 offerings with renewal terms extending to age 85.
  • Beneva – Term 40 guaranteed renewable to age 75. Limited availability outside Quebec.
  • Empire Life – Term 40 coverage with standard renewal and conversion provisions.

Sticking with large, established life insurers in Canada ensures a secure Term 40 purchase. Checking policy renewal and conversion terms is also advised.

Pros and Cons of Term 40 Life Insurance

Term 40 insurance offers unique tradeoffs versus shorter terms or permanent policies:


  • Longer coverage than Term 10, 20 and 30-year alternatives
  • Guaranteed level premiums for a full 40-year term
  • Typically cheaper than permanent life insurance
  • Includes conversion option on most policies


  • More expensive than Term 10, 20 or 30-year policies
  • Most buyers need a full 40 years of coverage
  • Must stay healthy to qualify for conversion later
  • Limited insurers offer Term 40 insurance

Term 40 works for specific long-range scenarios but isn’t ideal for all Canadians. Understanding the advantages and limitations is key.

Types of Term 40 Life Insurance

Types of Term 40 Life Insurance
Types of Term 40 Life Insurance

There are several varieties of term 40 life insurance available :

Level Term 40

This is the most common type of term 40 policy. Premiums and death benefits remain level for the entire 40-year term before increasing at renewal.

Decreasing Term 40

With this type, the death benefit decreases incrementally over the 40 years while premiums remain level. It is sometimes used to cover a debt that declines over time, like a mortgage.

Renewable Term 40

Most term 40 policies are guaranteed renewable to a certain age, such as 90. This allows the policyholder to extend coverage past the initial 40-year term.

Convertible Term 40

This feature allows the policyholder to convert to a permanent life insurance policy like whole life or universal life without proof of insurability. The conversion must occur within the initial 40-year term.

Read more: Types of Term Life Insurance

Who Should Consider Term 40 Insurance?

Certain demographics and situations may benefit most from Term 40 life insurance:

  • Young Families – Parents need income and mortgage coverage in retirement years.
  • Newlyweds – Couples seeking prolonged financial security as they start out.
  • High Net Worth – Wealthy individuals requiring estate planning and tax management for 40+ years.
  • Business Owners – Those financing buy-sell agreements, debts or key person coverage over long timeframes.
  • Refinancers – Homeowners are refinancing with new 30+ year mortgages after renewing the original mortgage.
  • Retirees – People wanting lifetime income replacement and burial funds beyond age 85.

Buyers with unique needs beyond 20 or 30 years may discover Term 40 insurance fits like a glove.

Is Term 40 Life Insurance Worth It?

Term 40 only makes sense if you actually require coverage for most or all of the 40-year term. It becomes expensive otherwise.

The prime benefit is insuring a high probability need like a mortgage or income lasting 30+ years. This justifies the pricier premiums.

But if the goal is simply maximizing coverage for the dollar over a shorter horizon, cheaper 10, 15 or 20 year terms work better.

So, weigh your budget, timeline, and risk exposures first. Term 40 insurance value depends wholly on aligning with long-range liabilities.

Tips for Purchasing Term 40 Insurance in Canada

Follow these best practices when shopping for Term 40 life insurance:

  • Compare rates from at least 3-4 top insurers to find the best premiums
  • Inquire about renewability and conversion options on the policy
  • Calculate the right coverage amount using a needs analysis tool
  • Avoid overbuying coverage for longer than truly necessary
  • Get quotes annually to ensure rates remain competitive
  • Work with an experienced independent broker who can access all Term 40 carriers
  • Ask about any special discounts that may apply to reduce premiums
  • Learn when renewal rates kick in and how much policies can cost to maintain
  • Discuss converting to permanent insurance before health changes later in life

Planning ahead on Term 40 insurance leads to the best policy at the lowest rates.

Should You Buy Term 40 Life Insurance?

Here are a few key questions to ask when deciding about Term 40 coverage:

  • How long will your mortgage, debts, income needs or business risks realistically last?
  • Does the stability of guaranteed premiums for 40 years align with your financial plan?
  • Are you in good health and likely insurable if you waited 20-30 years to get coverage?
  • Do you anticipate life insurance needs lasting well into retirement past age 65 or 75?
  • Is the difference in premium costs between Term 20 and Term 40 policies within your budget?

If you answered yes to some or all of these questions, Term 40 insurance may suit both your finances and longevity risks.

How to Buy Term 40 Life Insurance

Purchasing term 40 life insurance involves the following steps:

  1. Determine your budget and the coverage amount needed through a needs analysis.
  2. Research and compare quotes from highly rated insurance companies.
  3. Submit an application with basic personal details to the chosen insurer.
  4. Complete a medical exam involving blood, urine tests and vitals measurements.
  5. Interview with a nurse to review health and medical history.
  6. The insurance company will review the application and issue a policy.
  7. Pay the first premium to put coverage into effect.

Working with an experienced insurance broker simplifies the process and guarantees you get the best rate.

Where to Buy Term 40 Life Insurance

There are several options to purchase term 40 life insurance:

  • Life insurance Broker – An independent broker shops rates amongst multiple insurers. No extra fee to use a broker.
  • Insurance Agent – An agent sells policies from one insurer. Limited to policies from that company.
  • Insurance Company – Buying directly from the insurer by applying online or over the phone.
  • Online Insurance – Purchasing coverage through an online insurance marketplace. Limited selection.

Because term 40 policies aren’t widely available, using an insurance broker is recommended to access all options.

How to Claim Term 40 Life Insurance

To file a term 40 life insurance claim, beneficiaries must:

  1. Obtain certified copies of the death certificate.
  2. Locate the policy number and insurance company’s contact information.
  3. Request a claim form from the insurance company.
  4. Complete the claim form with details about the cause of death, beneficiaries, and payment method.
  5. Attach an original death certificate and return the claim form.
  6. The insurance company reviews the claim, verifies validity, and issues payment.

Alternatives to Term 40 Life Insurance

Term 40 insurance isn’t the only option for lasting coverage. Here are other routes to explore:

  • Term 10 Life Insurance, Term 20 Life Insurance , Term 25 Life Insurance, or Term 30 Life Insurance – Better for shorter debts, mortgages or family needs.
  • Permanent Life – Whole life and universal life offer lifetime protection.
  • Decreasing Term – Coverage declines over time to match certain debts.
  • Term to Age 65 or Term 75 – Some insurers now offer terms to age 65 or 75.
  • Term to Age 100 – Convertible term insurance lasting to age 100.
  • Renewable Term – Policies that can be renewed annually regardless of health.

A licensed advisor can assess needs and match buyers with the right policy term, type and length.

The claims process is typically straightforward for approved term 40 policies. The insurance company may require additional documents or information before issuing the payout.


Term 40 life insurance fills a narrow niche, ensuring long-range obligations lasting 30 years or beyond. While not ideal for every buyer, it can provide strong value for Canadians with unique protection needs lasting into their senior years.

Lower premiums than permanent insurance plus guaranteed renewability offer compelling stability. And the option to convert to lifelong coverage provides an added safety net.

The key is aligning Term 40 with debts, mortgages, taxes or income lasting multiple decades. Otherwise, cheaper short- and medium-term options will better fit the bill.

Canadians who need exceptional policy length yet still want affordable rates should absolutely explore Term 40 insurance. Partnering with an experienced advisor makes the buying process easy.

If you need customized guidance on finding the right term life insurance product for your unique needs and budget, visit Life Buzz today. Our licensed experts can provide an in-depth consultation to match you with the perfect policy from Canada’s top insurers. Why wait? Request your free quote now and take the first step to protecting your family and financial future.

FAQs about Term 40 Life Insurance

What are the renewal options on term 40 life insurance?

Most term 40 policies allow the policyholder to continue renewing the coverage annually past the 40-year term, up to a certain age like 75, 80 or 85. Premiums increase drastically at renewal since no health evaluation occurs.

At what age should you buy term 40 insurance?

Ideally, it's between ages 25 and 40. Buying earlier means lower premiums. After 50, term 40 rates become prohibitively expensive for most buyers.

Is term 40 life insurance a good idea?

If you have a long-term need extending near or into retirement, term 40 offers an affordable way to cover that need. But it isn't the best fit for those with shorter 5, 10 or 20-year insurance needs.

Is term 40 life insurance expensive?

Compared to terms 10, 20 or 30, term 40 costs more due to the longer coverage period. But it remains far cheaper than permanent forms of life insurance.

Can term 40 life insurance be renewed?

Yes, most term 40 policies feature guaranteed renewability to an advanced age like 75, 80 or 85. However, renewal premiums are much higher than the original premiums.

Why choose term 40 over term 20 life insurance in Canada?

You may choose term 40 over term 20 if you need life insurance coverage for a longer period, such as to cover a 30+ year mortgage or provide income replacement closer to retirement age. The longer-term means higher premiums.

Do all term 40 life insurance policies in Canada offer conversion options?

Most, but not all, term 40 policies in Canada allow you to convert to permanent life insurance within the 40-year term without medical underwriting. Be sure to ask an insurer or agent if this option exists.

What are the health requirements for qualifying for term 40 insurance in Canada?

Insurers have varying health requirements, but you typically need to be in good overall health with no major illness. Health issues may mean higher premiums or declination. Smokers also pay higher rates.

Is term 40 life insurance renewable after age 85 in Canada?

Term 40 life insurance expires at the end of the term, which is typically around age 85 in Canada. Some insurers allow renewing annually after this point. Renewal costs will be much higher.

Are term 40 premiums higher for women in Canada?

No, premium rates for term 40 life insurance are generally 10-20% lower for women than men of the same age and health status when applying in Canada.

What medical tests are required for term 40 insurance in Canada?

Insurers usually require a paramed exam (blood/urine sample, vitals) and perhaps an ECG test if you are older or have health issues. No tests are needed for simplified issue term 40 policies.

Can term 40 life insurance rates increase?

No, term 40 insurance offers level premiums that are locked in for the entire 40-year term. Rates can only increase if you renew the policy after the initial term expires.

What is the difference between term 40 and whole life insurance?

Term 40 insurance provides temporary coverage for 40 years. Whole Life provides permanent, lifelong coverage as long as premiums are paid. Term 40 is also cheaper than whole life.

Are term 40 insurance premiums tax deductible in Canada?

No, term 40 life insurance premiums are not tax deductible in Canada, unlike some permanent forms of life insurance.

Can I get term 40 life insurance with pre-existing health conditions in Canada?

Yes, you may be able to qualify for term 40 insurance with certain health conditions, but will likely pay higher premiums depending on the severity.

How do I determine how much term 40 coverage to get in Canada?

Do a needs analysis to calculate expenses your family/dependents would face without your income. Also, consider outstanding debts to cover.

Can smokers get term 40 life insurance in Canada?

Yes, smokers can qualify but will pay significantly higher premiums - as much as 2-3 times higher than non-smoker rates.

What can disqualify me from term 40 life insurance in Canada?

Major untreated health conditions like cancer, heart disease, or mental illness can disqualify you from term 40 insurance. Hazardous hobbies or careers can also impact eligibility.

How long do I have to review a term 40 policy after receiving it in Canada?

In most provinces, you get 10-30 days from the issue date to review a new term 40 policy and cancel with full refund if not satisfied.

If my health declines, can I still convert my term 40 to permanent coverage?

Yes, the conversion option on term 40 policies allows you to convert to permanent insurance with no medical underwriting needed.

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Written by Ben Nguyen

Ben Nguyen is an award-winning insurance expert and industry veteran with over 20 years of experience. He is the chairman and director of IDC Insurance Direct Canada Inc., one of Canada's leading online insurance brokerages.

Ben is renowned for his extensive knowledge of life, health, disability, and travel insurance products. He is the prolific author of over 1,000 educational articles published on LifeBuzz, BestInsuranceOnline, and InsuranceDirectCanada. His articles provide Canadians with advice on making smart insurance decisions.

With a Bachelor's degree in Actuarial Science and a Fellow of the Canadian Institute of Actuaries (FCIA) designation, Ben is frequently interviewed by media as an insurance industry spokesperson.

He has received numerous honors including the Insurance Council of Canada’s Pivotal Leadership Award, the Canadian Insurance Hall of Fame induction, and the President’s Medal from the Canadian Institute of Actuaries.

Ben continues to shape the vision and strategy of IDC Insurance Direct as chairman. He is dedicated to advancing the insurance industry through his insightful leadership.

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