With rising living costs, growing debt loads, and a shifting economy, many Canadians are reevaluating their financial safety nets—life insurance included. Whether you’re starting a family, buying a home, or thinking about your legacy, the question of “Do I really need life insurance?” is more relevant than ever. This blog explores when life insurance makes sense, when it might not, and how to decide if it aligns with your current goals and future responsibilities.
1. Why Life Insurance Can Be Worth It
Protecting Loved Ones and Leaving a Legacy
Life insurance offers more than peace of mind—it can be a powerful tool for financial security. The payout beneficiaries receive is tax-free, helping them manage immediate expenses and maintain stability after a loss. Whether it’s paying off the mortgage, covering funeral costs, replacing lost income, or ensuring kids can afford post-secondary education, life insurance can soften the financial blow of an unexpected death.
It’s also a valuable estate planning asset. Unlike other assets, life insurance bypasses probate and isn’t subject to estate taxes in Canada. For business owners, it can fund succession plans or buy-sell agreements. And for families, it’s a way to pass on a meaningful legacy without eroding wealth through taxation. Most importantly, it provides clarity and confidence in times of uncertainty—a financial foundation your loved ones can count on.
2. The Barriers: Misconceptions, Costs, and Complexity
What Holds People Back
Despite its benefits, many Canadians hesitate to buy life insurance due to a mix of perception and confusion. Studies show that people often overestimate the cost of life insurance by nearly three times its actual price. This misjudgment leads many to delay coverage, assuming it’s unaffordable or unnecessary at their age.
Another major hurdle? Procrastination. Life insurance is one of those tasks that feels easy to push down the to-do list—until it’s too late. Combine that with unclear policy terms, fear of being denied coverage, and uncertainty about exclusions, and it’s no surprise many go without. In fact, nearly a third of Canadians report being underinsured, leaving their families vulnerable in case of a financial shock.
"Legacy is not leaving something for people. It’s leaving something in people." — Peter Strople
3. Who Actually Needs Life Insurance
It’s Not One-Size-Fits-All
Life insurance is a tailored solution—worth it for many, but not for everyone. If you have dependents, such as children or a partner who relies on your income, it’s a critical safety net. The same goes for people carrying large debts (like a mortgage), or those wanting to protect a business or estate.
It’s also especially useful for young families—younger applicants can often lock in lower premiums for decades of protection. Homeowners, individuals with financial dependents, and key income earners should strongly consider coverage. On the flip side, if you’re debt-free, child-free, and have sufficient savings to cover end-of-life expenses, life insurance may not be essential at this stage of your life.
4. Term vs. Permanent Insurance
Choosing the Right Fit
When it comes to life insurance, term vs. permanent is one of the biggest decisions you’ll make. Term insurance is affordable, easy to understand, and ideal for people who need coverage during specific life stages—like raising kids or paying off a mortgage. It’s also flexible, with many policies offering the option to convert to permanent coverage later without medical underwriting.
On the other hand, permanent insurance—including whole life and universal life—offers lifetime coverage and can build cash value over time. This makes it useful for estate planning or accessing tax-advantaged funds while alive. The tradeoff? It’s more expensive and more complex than term insurance.
Understanding your timeline, goals, and budget will help determine the right type—or combination—of policies.
5. Final Verdict: Is It Worth It
It Depends on Your Why
The real question isn’t “is life insurance worth it?”—it’s what are you trying to protect? If you have people who depend on your income, debts that could burden your loved ones, or want to leave a legacy, then the answer is almost always yes.
But the how, when, and how much is personal. That’s why working with a financial advisor can make all the difference. They’ll help you design a coverage strategy that aligns with your goals—now and in the future.
6. Get Expert Guidance
Take the First Step with Confidence
Don’t wait until it’s too late. Whether you’re just getting started or reviewing existing coverage, now’s the time to assess your needs and build a plan.
Our team of Stone Owl advisors is here to help you implement these strategies for the best outcomes. Schedule a Discovery Call with us below to ensure your financial plans are on track.
