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Compare the best universal life insurance quotes in Canada

Shop the Canadian universal life insurance market with us today – your best option is only a few steps away.

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How to get universal life insurance with

  1. Tell us a bit about yourself

    Life insurance is specific to you, so we'll need a few details to customize your policy.

  2. Speak with an insurance broker

    We'll show you quotes from multiple providers, so a broker will be in touch to help you choose.

  3. Finalize your policy selection

    You may need a medical exam to finalize your policy, but you'll be guided through the process.

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What is universal life insurance?

Universal life insurance is a type of permanent life insurance product which combines a death benefit with an investment component. Like other types of life insurance, these plans pay out a set lump sum to your named beneficiaries upon your passing, offering coverage for various needs, such as estate planning. A portion of your premiums also go towards a cash value reserve – this is an investment account which allows your money to grow on a tax-deferred basis.

How does universal life insurance work?

Although complex, a universal life insurance policy is still a form of life insurance coverage at its core. This means that by paying regular premiums, your insurance provider agrees to pay out a set death benefit to your loved ones upon your passing.

There are two components to your premium payments. Firstly, you'll need to cover the cost of insurance – this is the minimum amount you need to pay in order to keep your policy active, covering administrative fees. Anything paid on top of this goes towards your cash value account which is a reserve of funds you can access during your lifetime.

The cash value is used for investing as money within this account grows on a tax-deferred basis – you won't need to pay income tax on the gains until you take out earnings. In comparison to whole life insurance, the cash value account for a universal plan comes with more options. You can choose where you want your funds invested (e.g. stocks, bonds), depending on the level of risk you're comfortable with taking on. Some policies offer minimal guaranteed interest rates while others allow you to invest in index and variable funds.

As your cash value grows, you can withdraw or borrow from it. Withdrawals often come with tax implications, but if you're planning on paying the money back, you'll usually only be subject to interest. If there are enough funds, you can also use the cash reserve to cover the base cost of insurance, allowing you to lower your out-of-pocket premium payments.

Aside from the flexibility of your premiums, the death benefit on a universal life insurance policy is also flexible. If you find that you need more or less coverage, you can negotiate with your insurer – increasing the amount, however, may require a medical exam.

Because these policies are a form of permanent life insurance, the benefit will eventually be paid out after death. Your loved ones will receive a tax-free lump sum that can be used for anything – estate planning, succession planning, and more. Any unused cash value, however, is generally left with the life insurance company

Is universal life insurance worth it?

Universal life insurance can be a worthwhile product, but it's not for everyone. If you only need coverage temporarily – say to cover an outstanding mortgage – then term life insurance will most likely be the more suitable, cost-effective option. And even if you've determined the need for a permanent policy, whole life insurance can offer more simplicity and less risk.

Universal life plans are designed to meet the needs of specific individuals – those looking for flexible policy options and tax-advantaged investing (especially after other accounts, such as the TFSA and RRSP, are maxed out). Here are a few sample scenarios in which this type of policy could come in handy.

  • High-income earners

    Because of the tax advantages, universal life insurance is best-suited for high-income earners who have already maxed out other investment options (e.g. TFSA, RRSP).

  • Financially literate

    The cash value earnings are based on your own investment choices, so having the financial knowledge can help. You may also choose to work with a financial advisor.

  • Business owners

    Universal life plans can be used for various business needs – acting as key person insurance, funding a buy-sell agreement, or providing funds for a succession plan.

  • Estate planning

    Universal life insurance can help with estate planning and wealth transfer needs. For instance, the death benefit can cover estate taxes owed upon death.

  • Charitable giving

    You can also name a charity as a beneficiary, giving back in a tax-advantaged way (while reaping lifetime benefits with the cash value).

  • Retirement fund

    Because you can withdraw or borrow from it, the cash value account can be used to supplement your retirement fund in a tax-efficient manner.

Universal life insurance sales in 2023

According to LIMRA's Canadian Life Insurance Sales Survey, the new annualized premium for life insurance within the country increased by 4% in 2023 to $1.86 billion – this number was the highest sales recorded in the Canadian market (since the survey was first established in 1993).

Universal life insurance took up 13% of the new annualized premium market share in 2023. Premiums totalled $248 million – a decrease of 14% when compared to year-over-year to 2022. The number of policies sold also saw a decrease of 8%. In comparison, term life new annualized premium market share amounted to 19% while whole life amounted to 68%.

learn more about the survey

Advantages and disadvantages of universal life insurance

Like all other life insurance products, there are various pros and cons to carrying a universal life plan. Here, we cover the main ones, so you can better understand if this is the right type of policy for you.

Lifetime coverage – Unlike term life insurance, your death benefit does not expire, guaranteeing a payout to your beneficiaries upon your passing (provided all your policy terms are met). 

Flexible premiums – Your premium payments can fluctuate, up to certain policy limits. Having enough funds in your cash value reserve can also allow you to skip payments or make smaller contributions if needed.

Flexible death benefit – Coverage needs can change during your lifetime, making universal life insurance an appealing option. You can potentially negotiate a lower benefit (allowing you to pay smaller premiums) or a higher benefit for added protection. Increasing it, however, may require you to complete a medical exam.

Cash value reserve – Like whole life insurance, universal plans come with a cash value reserve. This is money that you can access during your lifetime through withdrawals or loans, allowing you to receive peace of mind with an emergency fund in place. 

Tax-advantages – The investments in your cash value reserve grow on a tax-deferred basis, meaning you'll only need to pay taxes when you withdraw more than the amount you've put in – and you can choose to do this when it best suits your situation. Plus, like other life insurance products, the death benefit is paid out to your beneficiaries upon your passing without tax implications.

Get the best universal life insurance in Canada.

Compare the universal life insurance market with us today – your best option is only a few steps away.

How much does universal life insurance cost?

While the cost of universal life insurance will differ on a case-to-case basis, here are three average rates we pulled from top Canadian providers. Keep in mind, however, that these numbers are representative of one hypothetical policyholder – to find the exact cost you'll be paying, be sure to compare universal life insurance quotes with us today.

  • $1,410/year

    Universal life policy with $150,000 coverage

    minimum payment for a 42-year-old, non-smoking female

  • $3,991/year

    Universal life policy with $500,000 coverage

    minimum payment for a 38-year-old, non-smoking male

  • $5,324/year

    Universal life policy with $300,000 coverage

    minimum payment for a 55-year-old, non-smoking male

How are universal life insurance quotes calculated?

While the premiums you pay for a universal life insurance policy are flexible, you'll still need to make sure your cost of life insurance is covered – this is the minimum amount of money needed to ensure your policy stays active. Insurers offer quotes for minimum payments based on several different factors, including the following.

  1. Age

    The older you are, the more expensive life insurance gets. While some universal life plans have a cost of insurance that's fixed, others may increase overtime.

  2. Gender

    Men typically pay higher rates when it comes to life insurance. Statistically speaking, males have a shorter life expectancy than females.

  3. Health status

    If you have a pre-existing condition, universal life insurance can get much more costly. This may also be the case if your family has a history of medical issues.

  1. Lifestyle

    Smokers are subject to higher universal life insurance rates due to the added health risks. And working a high-risk job (e.g. firefighter) can also impact your rate.

  2. Coverage amount

    The death benefit on a universal life insurance plan is flexible, and choosing a higher one will inevitably lead to a higher cost.

  3. Policy options

    The type of investment plan you choose may impact your life insurance rate. Plus, adding on policy riders will only bring the payments up.

Universal life insurance vs. whole life insurance

Universal life insurance and whole life insurance are two of the most popular types of permanent plans – here, we cover the main policy features of the products, so you can better understand the similarities and differences.

Ready to secure your universal life insurance policy?

We can help – in just a few steps, we can connect you with a licensed life insurance broker who will guide you through the process.

Frequently asked questions on universal life insurance

Are universal life insurance policies a good investment?

Does universal life insurance expire?

Are universal life insurance premiums tax-deductible?

Can I withdraw money from my universal life insurance policy?

Can you borrow against a universal life insurance policy?