5 ways to save on life insurance

(without compromising your coverage)

Insider tips used by licensed insurance professionals

Are you looking for a life insurance policy that gives you the best coverage for the lowest possible price?

Knowing where to look and what questions to ask is half the battle.

Instead of re-hashing common life insurance advice, this guide shares actionable insider tips and tricks that professional insurance brokers and advisors use to save money while getting the coverage their clients need.

Shop smart and compare multiple quotes

Comparing 3–5 quotes from different providers is the best way to ensure you’re getting a good deal.

Professional brokers and advisors use special tools and software to collect and compare quotes from different insurance companies.

Here are three different Canadian online life insurance comparison tools:

• PolicyAdvisor.com

• Rates.ca

• InsuranceHotline.com

Entering your province, gender, age, smoker-status, and email address into any of these platforms will return multiple insurance quotes from the leading Canadian life insurance companies.

(RBC Insurance is not affiliated with these websites, and does not guarantee the results of their use.)

Tailor the quotes based on how much coverage you need, and how long you’d like the coverage to last.

Use strategic policy layering

Many people take out a single life insurance policy that covers all their needs for a fixed term.

But industry professionals often practice policy layering. This refers to the act of buying multiple life insurance policies with different coverage amounts and durations to match your financial needs at specific stages of your life.

Layer multiple policies for savings

Instead of paying for one large, expensive policy, layering smaller policies that only overlap when necessary can save you money while ensuring you have the right amount of coverage only when you need it.

Layering your life insurance policies in this way can reduce your overall payments significantly.

Example: Layering $350,000 of term life insurance coverage with RBC Insurance over 30 years into 3 different polices saves nearly 30% on your total premium payments.

Note: Rates and savings are based on a Simplified Term Life policy for a 41-year-old non-smoker male living in Ontario, with premiums paid annually²

How to layer life insurance policies

1. Determine your coverage needs for different life stages and financial obligations

• Immediate debts: Calculate your total short-term debts like personal loans or car loans (e.g., a 10-year term policy)

• Mortgage: Align coverage with the remaining years of your mortgage (e.g., a 20-year term policy)

• Long-term needs: Include income replacement for your dependents, or education costs for kids (e.g., a 30-year term policy)

2. Use a life insurance calculator

• Search for calculators from Canadian-specific platforms like PolicyAdvisor.com or InsuranceHotline.com

• Input different policy term lengths and amounts based on your financial breakdown from Step 1

• For example: Calculate $100,000 coverage for 10 years, $200,000 for 20 years, and $50,000 for 30 years

3. Compare costs to verify savings

• Add these premiums together to calculate the total cost of layered policies.

• Use the same calculator to check the premium for a single policy covering the highest amount for the longest period (e.g., $350,000 for 30 years)

• Compare this total cost to the combined cost of layered policies to confirm savings

Improve health and optimize your application timing

Insurance policy premiums are calculated through underwriting, which is the process insurers use to assess how risky it is to provide you with coverage.

Underwriting looks at factors like your health, age, lifestyle and occupation to decide how much your life insurance policy will cost and whether to approve it.

While you can’t change how old you are, you can change certain lifestyle and health factors to make you less risky (and less expensive) to insure.

Lower your BMI to reach a healthier range

Insurers often base premiums on BMI (Body Mass Index), a simple calculation that uses a person’s height and weight to designate a classification.

• Healthy BMI (18.5 – 24.9): Most insurers offer standard or preferred rates.

• Overweight BMI (25 – 29.9): Standard rates are still available, but preferred rates are less likely.

• Obese BMI (30+): Insurers may charge higher premiums or impose stricter underwriting requirements. Lowering BMI below 30 can lead to significant savings.

Quit smoking

In Canada, smokers typically pay 2 to 4 times more than non-smokers for life insurance.

Most insurers classify you as a smoker if you’ve used tobacco or nicotine products in the last 12 months, including vaping and nicotine replacements.

Time your application to maximize health improvement savings

If you plan to lose weight or quit smoking, it’s more cost-effective to wait for these health improvements before applying.

Apply six months after achieving significant health improvements to ensure these changes reflect in your medical records and can be used in the underwriting process to secure lower rates.

If you need life insurance coverage sooner, consider getting temporary short-term coverage to avoid overpaying for long-term coverage while waiting for your health factors to improve.

Target niche providers and specialized policies

While insurance companies provide coverage for all Canadians, some insurers offer specific demographics special offers or lower premiums rates.

1. Young, Healthy Individuals: Premiums are lowest for people in their 20s and 30s with no major health conditions

2. Non-Smokers: Non-smokers pay significantly less than smokers

3. Women: Women typically pay slightly lower premiums due to longer life expectancy

4. Professionals in low-risk occupations: Office workers and other low-risk occupations may qualify for better rates

5. Active, health-conscious individuals: People with excellent health metrics often qualify for preferred rates

6. Seniors seeking simplified policies: Seniors looking for smaller policies typically can access affordable options

If you fall into one of these categories, look for an insurer that offers special deals or programs for your group. Online comparison tools like PolicyAdvisor.com often highlight insurers’ strengths, while visiting an insurer’s website can help identify special rewards programs or rates.

There are several Canadian insurers that serve these demographics well.

• RBC Insurance: Offers flexible policies with competitive rates for term life insurance (Check our prices)

• Manulife: Rewards health-conscious individuals through its Vitality program

• Sun Life: Competitive rates for women and non-smokers, with flexible term options

• Canada Life: Strong options for seniors with simplified policies

• Empire Life: Ideal for young, low-risk professionals with competitive rates

• Industrial Alliance (iA Financial): Focused on fast approvals for simplified and no-medical-exam products

  Ask for discounts and advocate for yourself

  Asking the right question can unlock savings that you wouldn’t have otherwise known about.

  Make sure to ask these questions before purchasing a life insurance policy:

How to secure the best life insurance rates

Affordable, high-quality life insurance is achievable with the right strategies, even without a broker.

1. Compare multiple quotes

• Use platforms like PolicyAdvisor.com or InsuranceHotline.com to get at least 3-5 different quotes

• Toggle coverage amounts and term lengths to find the most cost-effective options

2. Consider policy layering

• Break coverage into multiple term policies to match your financial needs at different life stages

• Use calculators to estimate costs and confirm layering saves money over a single large policy

3. Improve your health before applying

• Work on lowering your BMI so it falls into a lower-risk category

• Wait at least 6 months after significant health improvements to apply

• If you plan to quit smoking or lose weight, take out a short-term policy now and reapply for a longer-term lower-risk policy once you qualify

4. Target niche providers

• Identify insurers specializing in your demographic, like young families, professionals, or non-smokers

• Review their terms and compare against broader market options

5. Advocate for discounts

• Ask about annual payments discounts, bundling opportunities, or matching competitor quotes

• Provide evidence of health improvements to negotiate better rates

  Tools and resources

3 reasons to choose RBC Insurance