What the coverage is usually for
- Funeral and burial or cremation costs
- Outstanding debts, credit balances or a remaining mortgage
- Probate, legal and executor costs while the estate settles
- Taxes triggered at death, including on registered accounts and secondary property
- An intentional gift to children, grandchildren or a charity
- Equalising an estate when one asset, such as a home or business, is hard to divide
Options available after 55
| Option | Typical use | What to watch |
|---|---|---|
| Final expense (permanent) | Modest lifelong coverage for end-of-life costs | Waiting periods on guaranteed issue versions |
| Fully underwritten permanent | Larger estate or tax planning amounts | Requires full medical underwriting |
| Term to a set age | A defined obligation ending at a known date | Coverage ends when the term does |
| Converting an existing term | Keeping coverage without new health questions | Conversion deadlines in the original contract |
If you already own a term policy
Before letting a term policy lapse, check whether it is convertible and when that privilege expires. Conversion generally allows an exchange into a permanent plan without new health questions, which can be valuable if your health has changed.
Renewal is a different thing. Renewing a term policy keeps it in force but usually at a substantially higher annual premium, so it is worth comparing renewal, conversion and a new application before deciding.
Underwriting at older ages
Insurers weigh age, health history, medication, mobility and cognitive health. Some will request an attending physician's statement. Others price around a short questionnaire and skip the exam.
Because carriers treat the same history differently, comparing across insurers matters more at older ages than at any other point. Nothing on this page is an assessment of eligibility.
Avoiding common mistakes
- Buying more coverage than the estate actually needs
- Naming the estate as beneficiary by default, which can expose the benefit to probate
- Leaving beneficiary designations unchanged after a divorce or a death
- Letting a convertible term lapse just before the conversion deadline
- Assuming a health condition disqualifies you without applying
Common questions
Is there an age limit to buy life insurance?
Most Canadian insurers set maximum issue ages that vary by product, and some final expense plans are available into the eighties. Availability depends on the insurer and the plan.
What is final expense insurance?
It is a smaller permanent policy, often between $10,000 and $50,000, intended to cover funeral costs, outstanding bills and immediate estate expenses. Applications are usually simplified or guaranteed issue.
Is a life insurance payout taxable in Canada?
A life insurance death benefit paid to a named beneficiary is generally received tax-free in Canada. Estate, probate and policy-specific tax treatment can be more complex, so confirm details with a tax professional.
Can I still get coverage with health conditions?
Often yes, through rated underwritten coverage, simplified issue or guaranteed issue plans. Approval, pricing and any exclusions are determined by the insurer after a complete application.
Keep reading
Simplified and guaranteed issue options explained.
Whole life insuranceGuaranteed permanent coverage and cash value.
Permanent life insuranceHow lifelong coverage designs compare.
How much coverage do I need?Sizing coverage around debts, taxes and final costs.
How underwriting worksExams, records and how insurers decide.
Heart conditionsCardiac history and life insurance applications.
Written and reviewed by Mathew Cordeiro, a licensed life and health insurance broker serving Ontario through Bluebird Assurance. This page is general information only, not financial or insurance advice. Coverage, features, eligibility and pricing vary by insurer and are subject to underwriting and policy terms.