Group life insurance plans (the insurance you have through your employer), as defined by the Autorité des marchés financiers of Quebec, often provide only very limited basic coverage. Depending on the insurer and the plan chosen by your employer, the amount of life insurance your heirs would receive in the event of your death can be based on your salary (for example, 1× your annual salary) or a fixed amount. Depending on your group life insurance plan, this fixed amount can be as low as $25,000. In other words, if you pass away, your heirs will receive $25,000, which is very little. 

Even though this amount may seem appealing to some, it’s not necessarily suited to all family situations. If you have young children, a mortgage, or other significant financial obligations, the amount provided by your group plan may not cover all your expenses and those of your family in the event of your death. 

*Note that some companies may offer their employees group insurance with a much higher life insurance amount. Everything depends on the plan chosen by your employer. However, in most cases, the life insurance paid out to your heirs through your group plan will be considered insufficient for your family’s needs. 

Another major drawback of group life insurance is that it’s temporary and depends on your employment status. If you change employers, lose your job, or retire, you risk losing your coverage or having it drastically reduced. Unlike a personal life insurance policy that follows you throughout your life, group life insurance is tied to the employee-employer relationship. 

Why get personal life insurance in Quebec?

a) The sooner you subscribe, the cheaper your life insurance will be 

At ClicAssure, we have access to a large amount of data on life insurance requests made via our online platform. A striking figure is that a very large percentage of the life insurance coverage requests we receive come from people aged 65. Why 65? Because that’s the average retirement age in Quebec. Retirees realize that they are no longer covered by their group insurance and therefore look for personal life insurance. The problem in this case is that the average life insurance premium for a 65-year-old person is significantly higher than for someone in their 30s, 40s, or 50s.

It’s important to note that in the vast majority of cases, premiums for permanent life insurance remain fixed over time. For example, if you take out a life insurance policy costing $15 per month at age 30, you’ll continue paying $15 per month at age 75. On the other hand, if you subscribe to life insurance in your 60s, the premiums could be nearly 10 times higher. 

If you’re a family with young children, it may be very wise to start looking for personal life insurance as soon as possible. This way, you’ll guarantee your family’s financial security should something happen to you. 

b) Personalize your coverage amount

According to Éducaloi, a life insurance policy is primarily a contract between you and the insurer that takes into account your personal situation, age, health condition, and financial needs. With personal life insurance, you can choose the coverage amount that fits your family’s reality (mortgage repayment, living expenses, children’s education, etc.). The options available on the Quebec market are very broad. You can opt for as little as $10,000 in coverage or take out a policy that would provide up to $2,000,000 to your heirs in the event of your death. 

c) Ensure continuity of coverage

Unlike group life insurance, personal life insurance isn’t tied to your employment status. Even if you change employers or retire, your personal life insurance policy remains valid as long as you continue paying your premiums. This provides peace of mind and ensures ongoing protection for your loved ones. 

d) Benefit from fixed or adjustable premiums

When you get personal life insurance (be it term life or permanent life), you have greater control over the type of contract and the way premiums are calculated. Some products offer fixed premiums over a set period, while others allow for adjustments based on your needs and budget.

e) Cover specific needs 

Along with the basic amount, you can add optional benefits (disability, critical illness, etc.) to your personal life insurance. This gives you the opportunity to build a policy tailored to all your priorities and those of your family. 

The benefits of combining group insurance + personal life insurance

There are many advantages to having personal life insurance in addition to being covered by a group insurance plan. 

1. Extended coverage: Your group plan can serve as a base level of protection, while your personal policy fills the gap if the coverage offered by your employer is too low.
2. Security in case of job changes: Personal life insurance acts as a safety net if you lose the insurance that comes with your job.
3. Better financial planning: By having both group and personal insurance, you protect your loved ones in various scenarios (accident, illness, premature death), safeguard your assets, and secure the necessary funds for your projects and those of your heirs.
4. Potential for long-term savings: If you take out permanent insurance relatively early, you’ll benefit from lower premiums and could accumulate a cash value (depending on the chosen product). 

How do you determine if you need personal life insurance?

1. Assess your financial situation: Calculate your total debts (mortgage, line of credit, credit cards), family expenses (living costs, education, etc.), and savings.
2. Anticipate expenses in the event of death: What would be the financial needs of your family to maintain their current lifestyle if you weren’t there?
3. Calculate your current group life insurance amount: Compare it with your actual needs. If there’s a large discrepancy, it could signal that additional personal life insurance may be necessary.
4. Consider your professional mobility: Are you likely to change jobs? Your career plans could result in losing or reducing your group coverage. 

Conclusion

Even if you already have life insurance through your work’s group insurance plan, it’s crucial to determine whether this coverage is truly adapted to your family situation and your long-term financial goals. Often, the amount provided by a group plan is limited, and its validity ends when you leave your job. 

By purchasing personal life insurance, you receive coverage that’s tailored, long-lasting, and independent of your employment. You can better protect your family, guarantee debt repayment, and provide more robust financial support to your loved ones in the event of your death. 

In short: Personal life insurance isn’t just a supplement to your group plan—it’s an investment in peace of mind and the long-term financial stability of your loved ones.