Why aren't more Millennials and Gen Z buying life insurance?

With files from Samantha Kohn.

This article was originally published on January 24, 2024 and was updated on September 26, 2025.

A new life insurance study from BlueCross reveals that while Canadians recognize the value of life insurance, many delay buying coverage because of perceived cost and a lack of understanding.

The study highlights that the risk of not having life insurance is felt most among younger generations, specifically Gen Z (92%) and Millennials (71%). 

It goes on to reveal that workplace benefits are the most common source of life insurance in Canada, resulting in higher coverage rates among younger Canadians. 73% of Gen Z and 68% of Millennials have some form of life insurance; however, 89% of Canadians recognize that workplace group life insurance plans are not enough coverage. 

So, if younger generations recognize the need for life insurance, why aren’t more Gen Z and Millennials purchasing policies?

Let’s dive into the possible reasons.

 

Why do Millennials and Gen Z need life insurance, anyway? 

Millennials and Gen Z, like all Canadians, need life insurance as a financial protection plan, both for their loved ones after they pass away and for the benefits they can access during their lifetime. 

Life insurance pays out a death benefit to your dependents, helping them cover expenses such as bills, loan payments, and funeral costs. Policies can also include living benefits, which let you access funds if you’re diagnosed with a critical illness or a disability that prevents you from working. 

Today’s financial pressures highlight the importance of having financial security, especially for younger individuals.

•  According to the study, half of Canadians say they wouldn’t be able to afford their current lifestyle for a year if the primary earner were to pass away. 
• Generation-wise, 89% of Gen Z and 79% of Millennials say they’ve experienced financial stress in the past 12 months, compared to just 69% of Gen X and 36% of Boomers. 
• Additionally, 89% of Canadians recognize the benefits life insurance has on their mental well-being, providing peace of mind and lessening worry about debts. 

Life insurance is essential if you have people relying on your income, if you have debts that could be passed on to others, or if you need financial assistance during your lifetime. 

Why do Millennials and Gen Z delay buying life insurance?

Key reasons why Millennials and Gen Z delay purchasing life insurance coverage are perceived cost and a lack of understanding.

According to the findings, 31% of Gen Z say life insurance is too expensive, and 26% say they don’t understand it. Millennials responded similarly. Despite these barriers, 89% of Canadians still recognize the value of purchasing life insurance in their twenties. 

It’s no surprise that cost is listed as a concern for younger generations. The reality, however, is that coverage can be affordable, especially if you buy early. Purchasing coverage when you’re young and healthy allows you to lock in lower rates and gives you flexibility to renew or convert your policy later in life. 

As for understanding, it can feel overwhelming to know where to start. However, the process is quite simple; obtaining a life insurance quote online is an easy way to discover how much a policy could cost, and with a simple click, you can connect with a licensed insurance broker to answer any questions. 

Also read: How much does life insurance cost in Canada?

Are group benefits enough life insurance coverage?

Typically, group benefits do not include enough life insurance coverage. While they’re common, group plans often have limitations, leaving policyholders underinsured. The coverage also does not follow you if you leave your company. As a result, 89% of Canadians agree that workplace coverage is insufficient. 

Without additional insurance through a personal policy, you could leave your family financially vulnerable if something happens to you. If you have a group plan, review your policy to see if there is a gap in your coverage. If yes, consider purchasing your own plan. 

Deciding how much coverage to get depends on your financial situation. A good rule of thumb is to use the DIME method, which calculates your debt, income, mortgage payments and education expenses to determine how big a policy you need. 

Also read: How much life insurance do I need in Canada?

Why buying life insurance early makes sense

A new study from PolicyMe shows that premiums increase about 8% per year you age. Therefore, delaying the purchase can actually result in higher costs. 

As a Gen Z or Millennial, you’re still young and likely in good health. Both of these factors can help keep your premiums affordable if you buy now. Life also changes fast when you're young; for instance, you may get married, buy a home, or have children. There is no rule that says you can’t purchase life insurance ahead of a major life event; it pays to be proactive. For example, with term life insurance, you can always choose to top up your policy with additional term length or a higher coverage limit as needed. Getting life insurance early just means you're ready for whatever comes next. 

As a bonus, some permanent life insurance plans build cash value over time, which could be beneficial later in life, for example, if you want to borrow against your policy. Getting life insurance early isn't just about covering the 'what ifs’; it's also a smart financial move for your future.

Also read: Life insurance in Canada: Why you should buy a policy in 2025

The bottom line

Millennials and Gen Z are delaying the purchase of life insurance, not because they don’t see the value, but because of perceived costs and a lack of understanding. Living costs in Canada mean that most younger generations experience financial stress, which is why they either delay buying coverage or rely on group benefits. 

Buying a policy while you're young and healthy helps you secure affordable rates and fill any gaps in your coverage. Compare life insurance quotes online today to see how affordable it can be. 

Also read:

• How does age affect life insurance rates?
• What is supplemental life insurance?
• Life insurance for young married couples
• Do you need life insurance under 35?