Choosing appropriate life insurance is crucial—it safeguards your family, calms your worries, and builds a secure tomorrow. In Canada, there are only three kind of Life Insurance – Term Life Insurance, Universal Life Insurance and Whole Life Insurance, and deciding which one is better suited for you can feel overwhelming.
At Planet Insurance, we focus on what matters to you and is best suited for you: your money goals, where you are in life today, and what you can spend. We’ve laid out the key details on both plans below, so the choice can be clearer.
What is Term Life Insurance?
Term Life Insurance keeps your family safe for a set number of years—usually 10, 20, 30 or 40. If you die during the term, your loved ones get a tax-free payout called the death benefit.
Term Life Insurance Highlights:
- Lower monthly cost compared to Whole Life in the beginning
- Choose how long** you want the coverage
- Great for short-term needs: paying off a mortgage, replacing your pay check, or covering kids’ schooling
- Some plans let you switch to a Whole Life policy later if you want
Who Should Buy It: Young parents, homeowners, or anyone who needs budget-friendly coverage for a limited time.
What is Whole Life Insurance?
Whole Life Insurance is a kind of permanent life insurance that stays in force for your entire life. When you keep paying the premiums, the protection never ends. A special feature is that the policy builds cash value that grows at a guaranteed rate without being taxed until you take the money out.
Whole Life Insurance Highlights:
- You get lifetime protection with a guaranteed payout when you pass away.
- The policy builds cash value, which you can take out or borrow against.
- Premiums are higher than for term life but stay the same for the rest of your life.
- It works as both insurance and a way to help with your financial planning.
Who Should Buy It: Whole life insurance is a good fit for anyone who wants coverage for life, is planning an estate, is transferring wealth, or simply wants a policy that grows cash value over time.
Universal life insurance is a type of permanent life insurance that combines lifelong coverage with a flexible savings component. Unlike term life insurance (which only lasts for a set period) or whole life insurance (which has fixed premiums and cash value), universal life allows you to:
- Adjust your premiums and death benefits (within limits)
- Accumulate cash value based on interest rates (usually tied to market interest or declared by the insurer)
Feature
Term Life Whole Life Universal Life
Coverage Duration Fixed term (e.g., 10, 20, 30 years) Lifelong Lifelong Premiums Fixed for term Fixed Flexible Cash Value ❌ None ✅ Yes (guaranteed growth) ✅ Yes (based on interest rates) Investment Component ❌ None ✅ Yes (insurer-managed) ✅ Yes (some types offer investment options) Cost 💲 Lowest 💲💲 High 💲💲 Medium to High Flexibility ❌ No ❌ Limited ✅ High (adjustable death benefit & premiums) Best For Temporary needs (e.g. income replacement) Lifelong needs + savings component Flexible lifelong coverage + potential growth Get Expert Advice Today
Whether you need affordable Term coverage or lifelong protection with whole life insurance or universal life insurance, Planet Insurance is here to guide you.
