The numbers are hard to argue with. Individual term life insurance policy sales in Canada rose 3.9% in 2025, recovering sharply from a 6.8% decline the year prior. The industry issued a total of 709,324 individual life insurance policies in 2025. Term life accounted for 365,832 of those — 51.6% of all policies sold. Whole life represented 32.2%. Universal life, 16.2%. By volume, term is not merely a product category. It is the life insurance market.
Alain Thériault's July 2026 deep-dive1 in the Insurance Journal maps the forces behind this dominance with precision, and the picture that emerges is one of structural pressure, intensifying price competition, and a demographic story that is more complicated than it first appears.
The Price Is the Product
Term life's central advantage is cost. A 35-year-old non-smoking man can purchase $500,000 of T20 coverage for as little as $29.40 per month through Co-operators Life Insurance Company, according to Compulife Quoter data pulled May 27, 2026. A 35-year-old non-smoking woman pays as little as $22.05 — a figure matched by three insurers: Beneva, Humania Assurance, and RBC Life Insurance Company. Compare that to whole life: the average monthly premium from the five most competitive insurers for the same $500,000 face amount runs approximately $289 for women and $333 for men. The discount is not marginal. It is structural.
Thériault reports that this gap helps explain why the T20 policy is consistently the preferred mortgage coverage vehicle. Stéphanie Corbeil, Senior Director of Assure Direct, notes that 20-year term is the most popular term among young adults aged 25 to 40. She argues it is more advantageous than bank-offered mortgage insurance, particularly on price: most financial institutions cap their premium guarantees at five years, while a T20 policy locks in pricing for the full term at rates reflecting the insured's individual health, not a group pool.
The Mortgage Connection and the 20-Year Sweet Spot
The alignment between a standard 20-year term policy and the typical 25-to-30-year mortgage amortization is not accidental. It is the logic driving the T20's dominance among first-time buyers and young families. Andrew Ostro, CEO of PolicyMe, adds empirical weight: an analysis of 18,000 clients found that buyers aged 18 to 40 most frequently purchased $500,000 of coverage on a 30-year term — with the T20 serving as the dominant benchmark.
Slower Life Paths, Slower Coverage Uptake
Thériault draws on a May 2026 Statistics Canada study comparing Millennials, Gen X, and Baby Boomers across the 25-to-39 age cohort. The data is telling. In 2021, 16.3% of Millennials aged 25 to 39 lived with parents — roughly double the comparable figure for Boomers in 1991. Millennial homeownership in that cohort stood at 49.9%, below Gen X at 56.2% and Boomers at 55.9%. The proportion of Millennials in this cohort who were married with children was 26.6%, compared to 34.5% for Gen X and 46.6% for Boomers at the same ages.
This deferred household formation delays the trigger events that typically generate term insurance demand. The market is there. It is simply arriving later.
Maximum Coverage Wars
One of the article's more striking structural observations concerns the race to raise maximum coverage ceilings. BMO Insurance tripled its maximum term coverage from $10 million to $30 million in 2024, vaulting to the top of the rankings. Desjardins Insurance raised its ceiling from $20 million to $25 million in October 2025. Four insurers — Canada Life, Manulife, RBC Insurance, and Sun Life — hold at $25 million. Empire Life moved from $10 million to $20 million in 2024.
Business Coverage and the Multi-Life Structure
The article also surfaces term insurance's growing role in business succession planning. A 10-year term policy covering $10 million for a 35-year-old non-smoking man can be obtained from Co-operators Life for $309.15 per month. At permanent life rates, the same coverage would cost between $6,000 and $7,000 monthly. For share buyout agreements and key-person coverage, the case for term is self-evident. Manulife's Family Term product accommodates up to 98 policies across more than six lives. ivari's SelectTerm allows up to 17 coverages per policy.
5 Key Takeaways for Advisors and Investors
- Term life's cost advantage over permanent coverage is not narrowing. It is the primary reason 51.6% of all individual life insurance policies sold in 2025 were term products, and advisors should lead with this in client conversations about mortgage coverage.
- The 20-year term is the default mortgage insurance alternative. Clients with good health can obtain individually underwritten T20 coverage at approximately half the cost of bank-offered mortgage insurance.
- Deferred Millennial household formation is delaying, not eliminating, demand. Advisors serving clients in their mid-to-late 30s should proactively surface term insurance conversations, as many are arriving at the trigger moments later than prior generations.
- Maximum coverage ceilings are rising industry-wide. For high-net-worth clients or business owners requiring $10 million or more in coverage, the competitive landscape now includes more carriers with more flexibility than at any prior point.
- Multi-life and share-buyout applications remain underutilized. The affordability of 10-year and 20-year term makes it a structurally attractive vehicle for business coverage — and most advisors are not positioning it that way.
Footnote:
Thériault, Alain. "Fierce Competition for Insuring 25 to 40 Year Olds." Insurance Journal, vol. 30, no. 3, July 2026, pp. 10–16.
