Best universal life insurance in Canada

What universal life insurance is — and who it’s for

Universal life (UL) is permanent insurance with an unbundled structure: you choose a death benefit, pay a flexible premium, and the portion above the cost of insurance goes into a tax-sheltered investment account with options you select. You can adjust premiums and the death benefit within limits.

That flexibility is the appeal and the risk: if the investments underperform or you underfund the policy, the cost of insurance can erode it. UL is best for financially sophisticated buyers — often high earners who have maxed their RRSP and TFSA and want additional tax-sheltered, permanent coverage for estate or corporate planning.

For most families, term insurance plus maxing registered accounts is simpler and cheaper. Use the needs calculator to size your actual coverage first.