Losing a loved one is hard, and the cost shouldn’t make it harder. In Canada, the funeral cost may range between $8,000 and $9,000 and higher. Funeral insurance helps cover such costs. 

The Canada Pension Plan (CPP) death benefit is a fixed amount which may not be enough to cover funeral costs. This is where final expense life insurance for seniors can help. 

Also called burial insurance or final expense insurance in Canada, this coverage is designed to pay for funeral services, outstanding debts, and other end-of-life expenses so your loved ones are not left with financial hardship. 

What is final expense life insurance seniors in Canada?

Final expense life insurance, also known as end-of-life insurance or burial insurance, is a permanent insurance that helps Canadian seniors cover the cost of their funeral after their death, without placing any financial burden on their loved ones.

The end-of-life insurance coverage ranges between $5,000 and $50,000, depending on the expenses your loved ones might incur for your funeral.

Why do Canadian seniors consider final expenses life insurance?

As a Canadian senior, you can buy life insurance to secure the future of your loved ones. You can choose a life insurance plan that provides coverage for a specific term based on your financial requirements. However, as you age, your financial priorities may change. Buying burial insurance for seniors helps your loved ones cover the cost of your funeral without facing any financial problems.

Here’s why you must consider buying final expense life insurance in Canada:

• Covering the cost of a funeral: The cost of funerals and other related expenses has grown significantly in Canada. The average cost of a funeral in Canada is estimated to range between $8,000 and $9,000. Government-sponsored coverage may not be enough to cover this amount. A final expense life insurance helps cover these gaps
• Clearing any outstanding debts: Unpaid debts may cause financial distress to your family members. The death benefit received from a life insurance policy can be used to clear any debts in your name, protecting your family from financial distress 

• Taking care of legal and medical fees: Typical health insurance plans in Canada may not cover certain end-of-life expenses. You may incur legal fees during estate planning, which adds to your overall expenses. Your final expense life insurance plan ensures that these costs are covered without exhausting your savings or putting any unnecessary financial pressure on your family
• Affordable and easy to buy: Final expense life insurance plans are affordable and easy to buy. Most of them do not require medical assessment and are easily obtainable. This can be of significant help to you, especially if you have health concerns

How does final expense insurance work for seniors in Canada?

Final expense insurance covers the cost of the funeral and other expenses related to it.. As you grow older, it is recommended that you consider buying a burial insurance plan.

Given below is the guide to how final expense insurance works for seniors in Canada:

• Buying an insurance policy: Many Canadian insurers offer protection for ages between 80 and 85 years with coverage between $5,000 and $25,000. Book a call with our expert advisors at  PolicyAdvisor to compare different quotes and buy appropriate insurance coverage

• Premiums are fixed: Premium rates for final expense life insurance in Canada are typically fixed after being issued, which will not increase with age. The premium depends on age, health, and coverage

• Tax-free payout: Your beneficiary receives a tax-free payout called the death benefit. This amount will help your loved ones fulfil their financial requirements
• Cover other expenses: Apart from clearing the cost of your funeral, burial insurance in Canada helps your loved ones manage their other financial expenses, such as mortgage payments, estate administration taxes, family debts, final income taxes, and other outstanding debts

What are the costs and premiums of final expense life insurance for seniors in Canada?

The premium rates for end-of-life insurance depend on your personal needs and the specifications mentioned in the policy document. You should compare life insurance quotes to determine the best policy for you. 

With the price of a funeral in Canada estimated to be between $8,000 and $9,000 and even more in 2025, burial insurance not only covers the funeral cost but also leaves a legacy behind for your loved ones.

*Illustrating the monthly cost of a final expense policy for smokers and non-smokers across different age groups and coverage amounts.

Do the premium rates vary by health status and age?

Final expense insurance premiums can differ. For example, if you are a senior in Canada, a non-smoker, and in good health, the monthly premium for coverage of $10,000 will be between $30 and $70. 

However, if you are a Canadian senior who smokes and is diagnosed with a medical condition, the premiums for the same coverage amount will cost $100 or even more, monthly.

What factors affect the price of final expense life insurance for Canadian seniors?

Several factors affect the final price of the insurance. It is important to be aware of them so that you can buy an appropriate policy offering you benefits suitable to your needs: 

• Age: The premiums will depend on your age. The older you are, the higher the premium rates will be

• Status of your health: The status of your health will determine the premium rates. Though insurance products like guaranteed acceptance offer insurance even if you are diagnosed with a pre-existing condition, the premium rates are high

• Status of smoking: The premiums for a smoker will be higher, as they are at a higher risk of potential health issues

• Gender: Premiums for women are lower since they are expected to have a longer life expectancy

• Coverage: If you choose a plan with high coverage, the premium payable will be high as well

• Type of policy: The type of policy also decides the premium rates. For example, the premium for a guaranteed accepted insurance plan will be higher compared to a simplified issue insurance plan

How does coverage affect the cost of final expense insurance in Canada?

The overall cost of your life insurance policy will depend on the coverage amount, as illustrated in the tables above. The premium for a life insurance policy with a higher coverage amount is typically higher, since the insurance company is taking more risk.

For example, a 75-year-old healthy non-smoker may pay up to $260 for coverage of $25,000, whereas another person of the same age but who is a smoker and diagnosed with a medical condition may pay up to $490 for the same policy.

What does final expense insurance cover?

A final expense life insurance plan helps your loved ones cover the cost of your funeral after your passing and handle their other financial expenses. This insurance is designed to ensure your loved ones do not face any financial problems after you are no more.

Your beneficiary can use the death benefit to clear various financial expenses, including:

• Cremation and funeral expenses: The cost of a funeral and cremation in Canada is estimated to be between $8,000 and $9,000, and can even go up to $15,000 in some cases. A burial insurance plan helps in covering these costs
• Outstanding debts: The coverage offered can be used to clear any outstanding debt you are unable to pay during your lifetime. This ensures your loved ones need not worry about any financial expenses once you have passed

• Legal fees: Your loved ones may have to pay an administrative fee during the settlement of the estate. The coverage received can help in clearing them

• Living cost: Your loved ones can use the coverage to take care of their day-to-day living expenses
• Leaving behind a legacy: Once all the costs related to the  funeral and other expenses have been cleared, any funds remaining can be used by your loved ones to take care of their other financial needs

What are the types of final expense life insurance policies for seniors in Canada?

End-of-life insurance for seniors comes in different types. A senior in Canada can choose from one of these insurance products based on their financial requirements and other final expenses. These burial insurance products help in covering the funeral costs and allow your loved ones to manage their own expenses. 

Final expense life insurance policies are of three types:

• Whole life final expense insurance
• Guaranteed issue final expense insurance
• Simplified issue final expense insurance

Whole life final expense insurance

A whole life final expense insurance is a type of permanent life insurance that provides you coverage for life in return for the timely payment of your premiums. 

Guaranteed issue final expense insurance

You can buy a guaranteed issue final expense insurance plan without undergoing a medical examination. The maximum eligible age for buying this insurance is 85 years, and it can be obtained even if diagnosed with a serious medical condition. This insurance product promises guaranteed approval of the application.

Simplified issue final expense insurance

Application for simplified issue final expense insurance plan doesn’t require a medical examination. However, answering a short questionnaire helps the insurer determine the coverage and the premium rates payable. You can consider buying this insurance since the application process is straightforward and quick.

How to choose the best end-of-life Insurance for seniors in Canada?

To choose the best end-of-life insurance, you will need to thoroughly research. Take into consideration certain factors when looking for life insurance to purchase the most suitable one.

Factors to consider before buying end-of-life insurance

You will need to take into consideration certain factors to buy the most appropriate end-of-life insurance:

• Determine your needs: Calculate the estimated coverage that covers the cost of the funeral and helps you leave behind a legacy. According to statistics by the Financial Consumer Agency of Canada, the total funeral expenses may range between $5,000 and $15,000. You must consider your outstanding debts and other expenses while deciding upon coverage

• Access your health status: Evaluate the status of your health and provide correct health-related information to receive appropriate coverage. You can buy a whole life insurance plan or a simplified issue insurance plan if you are healthy; otherwise, consider buying a guaranteed accepted insurance plan

• Budget review: Review your budget, monthly expenses, and other costs to determine if the premium rates for the coverage are affordable or not. Premium rates for burial insurance are mostly fixed, so you will have to buy a policy which fits your long-term budget
• Insurer reputation: There are plenty of insurance companies in Canada that are reputable and have strong financial ratings. You can get in touch with advisors at PolicyAdvisor, who will help you know more about these insurers and the policies offered by them

What are the common misconceptions about end-of-life expense insurance for Canadian seniors?

Seniors in Canada often misunderstand the purpose of burial insurance and believe myths that prevent them from buying a suitable policy. It is important to debunk these myths about this insurance so that you can make more informed choices when buying coverage.

Some of the common myths about final expense insurance include:

• It’s just insurance to cover funeral costs: Apart from covering the cost of the funeral, the death benefit is tax-free and can be used to cover other financial expenses too

• Too healthy to buy this insurance: You should buy final expense insurance when you are young and healthy, since the premiums are lower and stay fixed for life. With age, the health risk increases, making it difficult to get higher coverage at lower premiums
• Expecting your family to cover the cost: It is unfair on your loved ones to bear your debts after you have passed. This insurance ensures the beneficiary receives the death benefit to cover their funeral cost and also manages their financial needs

How to file a final expense insurance claim in Canada?

The claim-filing process for insurance in Canada is simple and easy, even though the process may vary among insurers. Understanding the claim-filing process helps in saving time and ensures the beneficiary receives the death benefit without undue delay.

• Inform the insurer: The beneficiary must inform the insurance company of your passing to begin the claim process

• Fill the claim form: The beneficiary will fill in the claim form, providing correct information to make the claim process easier and faster

• Submit documents: Along with the claim form, you will have to submit supporting documents

• Reviewing the claim: The insurer will review and verify the claim to make sure all the details are correct

• Payout received: Once the insurer is satisfied with the verification process, they will issue the death benefit to the beneficiary

Get in touch with the consultants at PolicyAdvisor, who will guide you through the claim-filing process for final expense life insurance and ensure all your claim-related queries are answered.