Why Is Life Insurance More Expensive For Men Than Women?

Why Is Life Insurance More Expensive For Men Than Women?

Written by Priyanka Correia
Fact-checked by Caitlin Wood
Last Updated June 23, 2021

Everyone has bills to pay. But many Canadians have loved ones who depend on their income to cover life’s biggest expenses, like a mortgage and utility bills. 

Think about what could happen if you passed away suddenly or were no longer able to work because of a serious injury or illness. What would your family do? How much would they struggle financially?

To avoid any unfortunate situations, a life insurance policy can ensure that your family members will still have a roof over their heads and their most pressing expenses covered. If you pass away while your loved ones still rely on you to cover the bills, a life insurance policy will pay them a tax-free lump sum of money. 

But like all other types of insurance, life insurance can be expensive. The exact cost depends on a number of factors, and gender is one of them. More specifically, men tend to be charged slightly higher premiums for life insurance than women. But why is that?

In this article, we’ll answer that question and provide some useful tips to help you keep the costs of your life insurance policy down. 

Life Insurance Premiums And Risk 

Insurance providers determine premium costs based on risk. The more risk they take on, the more they charge for insurance. And when it comes to life insurance in particular, men generally are considered higher risk than women.

Like any other business, insurance companies are in it to make money. If they take on too much risk without offsetting the risk with a higher price, they stand to lose out. As such, insurance providers assign premiums for policies according to how much risk they are assuming.

Gender isn’t the only factor that’s taken into account when a life insurance company calculates premiums for individual applicants. The following factors also play a key role in the price of a life insurance policy:

  • Age
  • Occupation
  • Lifestyle
  • Location
  • Smoking habits
  • Health history
  • Family history of health issues

For instance, someone who smokes, is in poor overall health, has a family history of heart disease, and is over the age of 50 will be considered a greater risk for further health complications than a younger person who is healthy and doesn’t smoke. 

If your chances of dying younger are higher, your premiums will be higher because the insurance company providing you with a policy is taking on a bigger risk with you. 

Learn how to buy life insurance.

Factors That Make Life Insurance More Expensive For Men Than Women

Generally speaking, certain types of risks are more prevalent with men than women, and insurance companies factor in these risks when calculating insurance premiums. These include the following:

Lifespan

According to Statistics Canada, the average lifespan for men is 79.9 years and 84 years for women. Since age is an important factor when it comes to the risk for insurance providers, a lower life expectancy would increase the price for a policy. And since men don’t live as long as women do, on average, insurers will consider that when it comes to policy pricing. 

Lifestyle

The activities you participate in will also dictate how much of a risk you will be to your insurer and therefore how much you will pay for a life insurance policy. And men tend to lead riskier lifestyles than women, generally speaking. This is especially true when it comes to occupation, which is another important factor that helps determine the cost of life insurance. 

Of course, this isn’t necessarily true in all cases. Many women lead much riskier lifestyles than many men. Every quote is provided on an individual basis. That said, statistics show that men are more likely to take part in more dangerous activities. And while insurance companies won’t restrict life insurance solely based on what the statistics say, they will still consider men to be an increased risk.

Suicide

In Canada, men have a higher rate of suicide compared to women. This can significantly shorten one’s lifespan and increases the risk for insurance providers. 

Incarceration

Men tend to be convicted of crimes at a higher rate than women in Canada. The higher the risk of landing in jail, the higher the risk for the insurance companies who cover them, which can translate into more expensive premiums.

Life Insurance Premiums For Men Vs. Women 

You might now understand why men can pay more for life insurance, but what are the exact differences in costs for life insurance among different genders? 

The answer to that question will depend largely on the type of policy; namely, term versus permanent life insurance. The following chart, sourced from The Globe And Mail, compares the monthly cost of a $500,000 policy for a healthy 30-year old individual. It breaks down and compares the average cost for various types of policies for men and women.

MenWomen
10-year term policy$24.30$18
20-year term policy$33.75$24.30
30-year term policy$195.65$157.81
Permanent policy$257.40$224.10

As you can see from the numbers, life insurance premiums go up in price with longer terms and are most expensive for permanent policies that are designed to last a lifetime. That said, premiums for men are slightly higher than they are for women for the same types of policies. 

While the differences seem minimal between the two sexes on a monthly basis, they are much more significant when you take into consideration the cost over an entire term. 

For example, a 30-year old male who takes out a 30-year term policy would pay out $70,434 by the age of 60, compared to $56,811 paid out by a woman who takes out the same policy at the same age, based on the above figures. That’s a big difference in the money spent on the same policy.

This is a simplified calculation based on premiums that remain the same throughout the entire term. The differences become even more pronounced when policies are initially taken out later in life. 

Thinking of switching providers? Check out how to cancel your life insurance policy.

What Can Men Do To Get A Lower Life Insurance Policy? 

While some things are out of your control when it comes to lowering your life insurance premiums — such as your age and gender — there are other things you can do to help keep the cost of your life insurance policy as low as possible:

Stop Smoking

If you’re a smoker, consider quitting. Not only will your lungs benefit, but so will your pocketbook. Smokers can pay twice as much for a life insurance policy as non-smokers, so you can save quite a bit on your policy if you make this one significant change.

Choose A Shorter Term

A life insurance policy can be most beneficial during your working years when you still have a mortgage and your children are minors. But once your mortgage is paid off and your kids are financially independent, you may not need as much coverage or any at all. Consider choosing a shorter term that will provide you with just enough coverage but won’t cost you as much as a longer-term policy.

Use A Broker To Help You Find The Lowest Rate

Insurance brokers are independent professionals who work on behalf of Canadians to find the best policies at the lowest rates. Brokers will compare insurers and negotiate rates on your behalf, helping you save time and money. 

See the difference between term life insurance and whole life insurance, here.

Final Thoughts

Gender can affect the price you pay for a life insurance policy. But it’s just one of several factors that influence your premiums, many of which are in your control to help minimize your contributions to your policy. Speak with an insurance agent or broker to help you get an accurate quote for a policy that provides you with the right coverage at the right price for your budget.


Rating of 5/5 based on 3 votes.

Priyanka is a personal finance expert at Loans Canada. She is passionate about money management and educating Canadian consumers about how to take control of their financial lives. She has taken financial control of her life by using Mint to budget and track her expenses while growing her wealth by investing through Wealthsimple. She also believes in having an emergency fund, so she keeps a good sum of money in an easily accessible high-interest savings account. She also uses the American Express Cobalt Card to earn points on all her purchases, further fueling her savings goal. She also uses Loans Canada’s lender directory whenever she wants to compare rates from different lenders.

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