Insurance comparison platform, My Choice Financial Inc., has conducted a study to analyze the adequacy of life insurance coverage among consumers in provinces across the country. They found that Canadians’ insurance coverage is not keeping pace with debts in at least five provinces, including, Alberta, British Columbia, Newfoundland and Labrador, Ontario and Quebec.
“Canada now has the highest household debt-to-income ratio among G7 countries, reaching over 180 per cent. This debt burden is particularly alarming in the context of rising costs of living and high interest rates, with nearly half of all mortgages in Canada due for renewal in 2024 and 2025,” they write. “The average household life insurance protection in Canada is $474,000.” The question, they add, is whether this is enough to cover debts and obligations.
Their analysis found a gap of 27.5 per cent in British Columbia, 25.5 per cent in Newfoundland and Labrador, a 23.6 per cent gap in Ontario, a 19.4 per cent gap in Alberta and a gap of 13 per cent in Quebec. “Manitoba and Nova Scotia fare better, with minimal coverage gaps and even slight over-insurance. However, the national picture remains concerning: the average Canadian household may not be adequately prepared to handle their financial obligations in the event of an unexpected death.”
