📚 Foundations ⏱ 6 min read

Stage 1: Deciding you may need coverage

The process starts with recognizing a potential need — a new mortgage, a growing family, a business agreement, or simply wanting to ensure dependants are protected. This is typically when people speak to a licensed insurance advisor (or begin researching independently).

Stage 2: Applying for a policy

To apply for life insurance, you complete an application form. This includes:

  • Personal details (name, date of birth, address)
  • The type and amount of coverage you're seeking
  • Your beneficiary designations
  • A health questionnaire — your current health, medical history, medications, family history of serious illness
  • Lifestyle disclosures — smoking status, alcohol use, recreational activities, travel
  • Consent for the insurer to access medical records if needed

Stage 3: Underwriting

Underwriting is the insurer's risk assessment process. The underwriting team reviews your application to determine:

  • Whether to offer you coverage
  • At what price (premium)
  • Whether any exclusions or modifications apply

For smaller coverage amounts or simplified products, underwriting may be fast — sometimes just a few days of reviewing your application and a database check. For larger coverage amounts, the insurer may require a medical exam (blood draw, blood pressure, urinalysis), or request records from your physician.

Underwriting outcomes
  • Standard approval: Offered coverage at standard rates.
  • Rated approval: Offered coverage at a higher premium due to elevated risk (health condition, occupation, etc.).
  • Conditional approval: Coverage offered with specific exclusions (e.g., a condition excluded from coverage).
  • Decline: Coverage not offered, typically due to health factors. Declined applicants can sometimes apply for guaranteed-issue products with limited coverage.

Stage 4: Policy issuance

If approved, the insurer issues a policy document — the formal contract. You should receive this in writing and keep it in a secure place your beneficiaries can access.

Canadian insurance law generally provides a free-look period (10–30 days, varying by province) during which you can review the policy and cancel for a full refund if it doesn't meet your needs.

Stage 5: Paying premiums

Once the policy is in force, you pay premiums on the agreed schedule — monthly, quarterly, semi-annually, or annually. Premiums keep the policy active. Missing premium payments triggers a grace period (typically 30 days), after which the policy may lapse.

For term policies, premiums are typically level for the term. For some permanent policies, there may be flexibility in premium timing and amounts.

Stage 6: The policy in force

While premiums are paid and the policy is in force, the insured is covered. During this period:

  • The policyholder can update beneficiary designations
  • Certain policy changes (coverage amount adjustments, adding riders) may be possible with the insurer's agreement
  • Term policies may be renewable or convertible at the end of the term
  • Permanent policies may accumulate cash value that can be borrowed against

Stage 7: Filing a claim

When the insured person dies, the beneficiary (or their representative) files a claim with the insurer. The process typically involves:

  1. Notifying the insurer of the death
  2. Submitting a completed claim form
  3. Providing an original or certified copy of the death certificate
  4. Providing proof of identity as the beneficiary
  5. The insurer reviews the claim against the policy terms (e.g., checks that death occurred while the policy was in force, and that no exclusions apply)
  6. Payment of the death benefit, generally within 30–60 days of the insurer receiving all required documentation
💡 Tell your beneficiaries Beneficiaries who don't know a policy exists can't claim it. Keep your policy documents accessible, and let your beneficiaries know where to find them and which insurer issued the policy.
⚠️ Educational only This is general educational information about how life insurance works in Canada. The specific terms, processes, and timelines for any individual policy are determined by that policy's contract. Always review your policy document and speak with your advisor if you have questions about your specific coverage.