Question 1

How does permanent life insurance work in Canada?

Accepted Answer

Permanent life insurance provides lifelong coverage. Your beneficiaries receive a tax-free death benefit after you pass away. Some permanent life insurance policies also build cash value, which you can access during your lifetime as a financial resource.

Question 2

What is cash value in permanent life insurance?

Accepted Answer

Cash value is the portion of your premium that accumulates savings within the policy and earns interest over time. You can withdraw from it, borrow against it, or leave it to grow. However, keep in mind that withdrawals or loans may reduce your policy’s death benefit and, in some cases, may be subject to taxes.

Question 3

Can permanent life insurance be purchased online?

Accepted Answer

Depending on the policy type, some plans allow you to apply online for coverage up to a certain limit (for example, $25,000). For higher coverage amounts, you usually need to apply through an insurance advisor.

Question 4

What is the minimum age to apply for permanent life insurance in Canada?

Accepted Answer

Canadian residents can apply for permanent life insurance starting at age 16. Parents can also purchase a permanent life insurance policy for their children and later transfer ownership to them.

Question 5

What is the difference between permanent life insurance and term life insurance?

Accepted Answer

Permanent life insurance provides lifelong coverage, builds cash value, and typically has fixed premiums.
 Term life insurance covers you for a specific period (for example, 10, 20, or 30 years). If you pass away during that term, your beneficiaries receive the benefit. However, if the term ends and you are still alive, no payment is made.

Question 6

When can you withdraw cash from a permanent life insurance policy?

Accepted Answer

There are three main options:
 • Direct withdrawal: You can take out a portion of the cash value, but it may be subject to taxes.
 • Policy loan: You can borrow against the cash value, which must be repaid. If it’s not repaid, the outstanding amount will be deducted from the death benefit.
 • Policy surrender: You cancel the policy and receive the net cash value, but your life coverage ends permanently.

Question 7

Does permanent life insurance expire?

Accepted Answer

No. As long as premiums are paid, permanent life insurance never expires.

Question 8

How long do you have to pay premiums?

Accepted Answer

It depends on the type of policy:
 Some plans require premium payments for life, while others are limited-pay policies (for example, 20 years or up to age 100). In limited-pay policies, once the payment period ends, the coverage remains active for life.

Question 9

Does the premium change with age?

Accepted Answer

No. In most types of permanent life insurance, the premium remains fixed from the start and does not increase with age.

Question 10

Do you have to answer medical questions when applying for permanent life insurance?

Accepted Answer

In most cases, yes. Insurance companies require health information to assess risk. However, some simplified products may be available without a medical exam or with only a short questionnaire—though these usually come with lower coverage limits and higher premiums.

Question 11

Is underwriting required when applying for permanent life insurance?

Accepted Answer

Yes. Almost all permanent life insurance policies involve an underwriting process in which the insurer reviews your health, medical history, and sometimes financial background. Only a few specialized products are available without full underwriting.

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Permanent Life
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Permanent life insurance is a type of life insurance that provides lifetime coverage.

**Permanent Life Insurance – Questions a

How does permanent life insurance work in Canada?

What is cash value in permanent life insurance?

Can permanent life insurance be purchased online?

What is the minimum age to apply for permanent life insurance in Canada?

What is the difference between permanent life insurance and term life insurance?

When can you withdraw cash from a permanent life insurance policy?

Does permanent life insurance expire?

How long do you have to pay premiums?

Does the premium change with age?

Do you have to answer medical questions when applying for permanent life insurance?

Is underwriting required when applying for permanent life insurance?

Do you have any additional questions?

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