Know Your Insurance – Life Insurance in Canada

Life insurance isn’t a pleasant thing to think about, and it may seem like an unnecessary expense. But if you have dependents who rely on you for financial support, then life insurance is really about protecting them in case something happens to you. With life insurance in Canada, you can keep paying off your mortgage and other debts, maintain your family’s current living situation and create funds for your family’s future. Securing a strong financial future begins with planning.

However, deciphering all of the parts of your life insurance policy can be difficult. Here, we’ve broken it down section by section so you can understand the information that is included in each part.

Declarations Page

The declarations page of your life insurance policy provides an overview of your contract. Included on the declarations page are the following:

  • Name of the insurance company
  • Your name and address
  • The policy number and type
  • Effective and expiration dates of the policy (for term life insurance)—your policy covers you between these two dates
  • Coverage information—the coverage amount you have selected should be listed here
  • Premiums—this is how much you will pay each month for coverage
  • Name of the beneficiary—this is the person or people named by you, the owner of the policy, who will receive the policy benefit
  • Any special conditions or changes made to the policy

When you receive a copy of your policy, it’s important to review all of the information on the declarations page for accuracy. Keep a copy of your declarations page in your files in case you find yourself with questions about your policy. If you change or revise your policy at any time, a new declarations page will be issued to you reflecting the changes. Make sure to review and keep this new declarations page as well.

The Insuring Agreement

The remaining pages of your policy document are called the insuring agreement. The insuring agreement section of your life insurance policy explains the risks you are covered for, the way payments will be administered and the amount of time the policy covers you for. The purpose of the insuring agreement is to state the terms of the policy explicitly and clearly, leaving no room for misunderstandings.


The insuring agreement always includes a definitions page. This is where the “fine print” of your policy is located. The definitions page defines vocabulary you will find in your policy to make it easier to understand. It also states your rights as the policy holder.


Your responsibilities and the responsibilities of the company insuring you are outlined here. Conditions include payment requirements, the proper steps for filing a claim and the process for resolving disagreements. If you have any questions about the conditions of your policy, make sure to contact KRG Insurance Brokers right away to prevent issues.


This section of the insuring agreement lists the events and circumstances which are not covered as part of your policy. The intent of the exclusions section is to make your policy as clear as possible and prevent any surprises in the event of a claim. A solid understanding of what your policy excludes is crucial in determining any additional coverage you may want to purchase. Contact KRG Insurance Brokers if you need any clarification on the items that are excluded from your policy.

How are life insurance premiums calculated?

When applying for life insurance, the insurer will determine your health status based on your age, gender and overall health. Since women statistically live longer than men, their premiums are lower. Plus, younger people have lower premiums because they typically have a longer period of time to pay their premiums and tend to have fewer health problems. These factors are not controllable. Your lifestyle, engaging in dangerous activities and having modifiable health issues (such as smoking-related asthma) will increase your premium.

Types of Life Insurance

Term: Your premiums are paid either annually or monthly and you and your family are covered for a specific amount of time, or “term.”

Permanent (or Whole): Your premiums are paid on a set schedule for your entire life and you are covered for your whole life, too.

Universal: You have a premium expense charge which is then deposited into an account. The account accrues interest, and money is deducted every month from this account to pay expenses such as your insurance premiums. Withdrawals can be taken from this account for certain needs. You are covered for life, as long as premium payments are still being made.

Make sure to set aside some time each year to review your policy and ensure that the limits and coverage you have selected are right for you. Evaluate your needs based on your provincial regulations, your health, your age, the money you have in savings and the amount of risk you feel comfortable taking. Then, make sure to read the entire insuring agreement—especially the exclusions—to guarantee that you are covered in every situation that is necessary for your lifestyle. If you have questions about your life insurance policy in Canada, contact KRG Insurance Brokers today!

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