9
2006 2008 2010 2012 2014 2016
Individual whole life Individual universal life
Individual term Group term
Individual life insurance
has grown faster than
group in the past
decade, accounting for
60% of the total, up from
54% in 2006. This is
mostly driven by growth
in individual term life
insurance
46%
45%
44%
42%
41%
40%
28%
29%
31%
33%
35%
36%
13%
12%
11%
11%
11%
11%
13%
14%
14%
14%
13%
13%
-
$1T
$2T
$3T
$4T
$5T
Life insurance protection by product
At the end of 2016, Canadians owned $4.5 trillion of life insurance protection. There are two basic
types of life insurance: permanent and term insurance, with variations on each to meet specific
consumer needs.
Term insurance provides cost-effective, temporary coverage over an insured's younger years.
Premiums typically increase over time in 5, 10 or 20 year "steps". Term insurance usually
provides a right to convert to permanent insurance with the same insurer without further
underwriting, providing consumers with the ability to adjust coverage to address long-term
needs.
Permanent insurance meets life-long protection needs. In addition to death protection, cash
values are accumulated and can be used for financial emergencies, or to supplement
retirement income. Premiums can be paid over a set number of years or for life.
Whole life insurance is the traditional form of permanent insurance where the insurer
takes
on both the risk related to death and the underlying investment risk. Under Universal life
insurance, consumers select investment options and the insurer assumes the risk related to
death.
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