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The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company have become one company – The Canada Life Assurance Company. Discover the new Canada Life

The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company have become one company – The Canada Life Assurance Company. Discover the new Canada Life

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Freedom 55 Financial is a division of The Canada Life Assurance Company and the information you requested can be found here.

What is 10 year term life insurance?

Key takeaways

  • This type of term life insurance policy provides coverage for 10 years at a locked-in rate, meaning premiums won’t go up for the length of your term.
  • This policy can be a lower cost option that other life insurance.
  • A 10 year term is ideal for people looking for shorter term life insurance coverage.
  • If you’re interested in 10 year term life insurance coverage, explore your options, like Canada Life’s My Term™ 10-year coverage.

What is 10 year term life insurance?

This is a life insurance policy where you have locked in your premium rate for 10 years.

It offers temporary coverage that can provide your loved ones with a lump sum payment if you die within the 10 year “term” of the insurance, provided you’ve been paying your premiums.

You can usually renew or extend your coverage when the 10 years are up, and in some cases, you may be able to convert to a different policy.

Who is best suited for 10 year term life insurance?

This is a great life insurance option for people who are looking for shorter term coverage.

This could be because:

  • You’re not sure what the next 10 years will bring, meaning you’re not ready to lock into a longer term 20 or 30 year policy.
  • You’re bridging an unexpected gap in insurance coverage, like your kids being dependent on you longer than planned, or your mortgage taking longer to pay off.
  • You want a lower cost policy, and maybe can’t commit to the higher premiums of a longer term.
  • You’re young and want to lock in cheaper premiums while you start paying off student debt, build up your savings, and begin your retirement planning.
  • You have a specific thing you would want to use that life insurance payment for if you died, like covering a car loan or a line of credit.

How does 10 year term life insurance work?

If you die within the 10 years the policy is active and your claim is payable, the people you named as a beneficiary will get a tax-free lump sum payment.

It may help ease the financial pain of your passing. It can be used to pay the mortgage, for example, or help with kids’ education when you’re gone.

Once you’ve got coverage, you will pay a set premium, usually monthly or annually. You’ll pay this same amount for the duration of this policy.

Once the term of the policy has finished, if you still need life insurance coverage you can usually extend or renew your coverage. However, your premiums will generally be recalculated, and may be higher because you’re older, or if your health has changed.

What you should bear in mind if you’re considering 10 year term life insurance?

Like other term life insurance coverage, a 10 year term life insurance policy doesn’t have the same “savings” component that whole life insurance policies have. This means they have no cash value. Their primary benefit is the payment your loved ones could receive when you die.

That said, you may be able to convert your term life insurance policy into a whole life policy if you decide that’s what is right for your situation. In that case, your premiums may be higher but you will also be creating cash value you can access during your lifetime.

You can also usually add on additional benefits to your 10 year term life insurance policy, like accidental death insurance, for example.

The amount of coverage you might want in this policy should be based on your individual circumstances. For example: Would your family be replacing your income? How long would they need that cash to last before it can be replaced? Do you have other savings or assets?

How much does term life insurance cost?

The cost for life insurance varies from person to person. Premiums are calculated based on:

Age

Generally, insurance is less expensive when you’re younger.

Health

Family history, chronic diseases and lifestyle can increase costs.

Gender

Women live longer than men on average, so their insurance may cost less.

Occupation

If you have a dangerous job, the cost to insure you can be higher.

Is a 10 year term life insurance policy worth it?

This will depend on your individual situation. If you are someone who only wants shorter term coverage at a lower cost than other kinds of life insurance, it may be a good option.

Everyone is different, so make sure you chat with your advisor or a licensed professional to figure out the life insurance coverage that is best for your needs. You can also see how much 10 year coverage would cost by getting a quick quote online.

 

 

 

What’s next?

  • Consider your unique situation and decide whether this is the right life insurance coverage for you.
  • If you’re interested in 10 year term life insurance coverage, explore your options, like Canada Life’s My Term™ 10-year coverage.

The information provided is accurate to the best of our knowledge as of the date of publication, but rules and interpretations may change.  This information is general in nature, and is intended for informational purposes only. For specific situations you should consult the appropriate legal, accounting or tax advisor. 

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