WINDSOR, Conn., Nov. 12, 2019 — A recent LIMRA study revealed that 12.6 million Canadian households own life insurance coverage, an increase of 3.4 million over the past six years. This marks the highest level of ownership to date in Canada.
Over the past 37 years, the number of Canadian households with life insurance coverage grew from 7 million to 12.6 million, an increase of 81%.
These are some of the key findings from the 2019 Canadian Life Insurance Ownership Study—Household Trends Report, which monitors long-term patterns in life insurance ownership, adequacy of coverage and consumers’ attitudes about life insurance.
In the latest study, 1 in 4 Canadian households own both individual and group life. This level is the same as in the 2013 study, but down 11 points from the 2006 study period.
“If a household owns more than one type of life insurance, it is usually better protected than other insured households,” said Jim Scanlon, senior research director for LIMRA. “In addition, households with overlapping coverage aren’t at risk of losing all protection due to a change in employment.”
Three quarters of the Canadian households that own life insurance purchased it from an insurance advisor, agent, broker or other financial professional. Only 15% report purchasing policies through other distribution channels.
The top reasons consumers give for owning life insurance—final expenses, a necessity and wealth transfer—remain unchanged from the 2013 study. The prevalence of the next most popular reasons, employment benefit and for income replacement, has increased significantly over the past six years (see chart).
Other key findings from the report:
- Currently, 2 out of 3 households (68%) have either group or individual life insurance.
- Almost half (49%) of all households have group coverage, while just under half (44%) have individual coverage.
- Since 2013, the number of households that own individual life insurance grew 41%, and those that own group life grew by 35%.
- The total amount of life insurance coverage owned by Canadians is approximately $2.5 trillion.
- Canadian consumers have difficulty making decisions when purchasing life insurance, including the choice between term or permanent products, the right company to purchase from and determining the right amount of coverage.
This year’s Canadian Life Insurance Ownership Study surveyed more than 4,100 Canadian household financial decision makers. The results were weighted to represent all Canadian households.
Serving the industry since 1916, LIMRA helps to advance the financial services industry by empowering nearly 600 financial services companies in 64 countries with knowledge, insights, connections and solutions. Visit LIMRA at www.limra.com.