Canadians Lagging on Life Insurance Despite Fear for Family’s Future, New Study Finds

As the cost of living rises, Canadians are cutting back on essential protections like life insurance. A new report from PolicyMe, in partnership with Angus Reid, reveals that nearly two in three uninsured Canadians (65%) say they are unlikely to get life insurance in the next five years, and that one in four Canadians (25%) are not confident or are unsure their families would be financially secure if they passed away unexpectedly.

With September marking Life Insurance Awareness Month, Unprepared: The 2025 Life Insurance Gap Report finds a growing protection gap, particularly among young Canadians and families with children. The study points to affordability concerns, medical requirements, and mistrust of the industry as the barriers that leave households unprotected.

What are Canadians saying about life insurance?

Coverage Gaps Are Widespread:

• Almost half of Canadians (42%) don’t have life insurance or aren’t sure if they do.
  • More than half (58%) of Canadians have life insurance, most commonly through their employer (37%), followed by term life (15%), mortgage life (8%), and other forms (2%).
• Nearly half (49%) of Canadian parents say they don’t plan to purchase life insurance within the next five years.
  • Almost half (42%) of parents say it is too expensive, 12% say they have not thought about it, and 8% say they do not need it.
• Among those without insurance or unsure, nearly one in four (23%) have children living at home.
• British Columbia has the highest share of residents without coverage or who are unsure at 50%, and is also one of the least confident provinces, with 22% not confident that their family would be financially secure if they passed away unexpectedly – highlighting how low coverage goes hand in hand with low confidence.

Affordability and Living Costs Are Driving Delays

• More than one in three Canadians without coverage (34%) say it’s too expensive, and 42% of those have children in the household.
• One in ten (10%) say high living costs have delayed their plans, including 22% with children.
• More than one in four Canadians (27%) believe they don’t need life insurance.

Families Are Worried About Financial Security

• One in four Canadians (25%) is not confident or is unsure that their families would be financially secure if they passed away unexpectedly.
  • By contrast, the majority of Canadians who currently have life insurance (80%) feel confident in their family’s financial security.
• By province, Atlantic Canada residents are the least confident at 23%.

Most Canadians Don’t Plan to Buy Coverage Anytime Soon

Do you know that prices for life insurance generally increase by an average of 8% each year you get older? Despite that, the survey found that:

• Nearly two in three uninsured Canadians (65%) say they are unlikely to get life insurance in the next five years.
• Younger Canadians (18–34) are the most likely age group to consider purchasing at 34%, compared to 22% of those aged 35–54 and only 4% of those aged over 55.

Medical Tests Are a Barrier

• Over one in four Canadians (26%) say that the medical tests required for life insurance make them less likely to purchase it.
• Among those who are likely to buy in the next five years, more than one in three (37%) say medical tests make them hesitate.

Canadians Doubt Insurers Pay Out Claims

• One in five Canadians (21%) believes life insurance companies pay out 50% or less of their claims, when in reality, companies are hitting a 99% claim payout rate in Canada.
• Nearly half (49%) believe insurers pay out more than 51% of claims.

“Life insurance is supposed to provide peace of mind, yet our findings show that too many Canadians either don’t have coverage or don’t trust the industry,” said Andrew Ostro, CEO and Co-founder of PolicyMe. “This report makes it clear that many Canadians still find traditional insurance difficult to navigate. At PolicyMe, we’re focused on removing those barriers with affordable, accessible coverage that families can actually understand and feel confident in.”

PolicyMe has streamlined the traditional life insurance process with digital applications, straightforward medical questions, and affordable pricing designed for Canadian families. By eliminating unnecessary complexity and costs, PolicyMe is reshaping how Canadians approach financial protection.

To learn more about PolicyMe, please visit policyme.com.

About PolicyMe

PolicyMe is Canada’s leading digital insurance solution, offering straightforward and affordable financial protection for families from coast to coast. Its product suite includes Life Insurance, Critical Illness Insurance, and Health & Dental Insurance, all tailored to Canadians' evolving needs. The company also offers B2B2C solutions, partnering with organizations to provide seamless digital insurance options. Founded by a team of insurance experts and technology entrepreneurs, PolicyMe is committed to making insurance simpler and more accessible. The company operates with a remote-first culture, attracting top talent from across Canada. To learn more, visit www.policyme.com.

Methodology: These findings are from a survey conducted by PolicyMe from August 21 to August 25, 2025, among a representative sample of 1,507 adult Canadians who are members of the Angus Reid Forum. The survey was conducted in English and French. For comparison purposes only, a probability sample of this size would carry a margin of error of +/-2.53 percentage points, 19 times out of 20.

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