Term-100 Life Insurance in Canada: The Middle Ground Between Term and Whole Life (2026)

Term-100 life insurance is a permanent life insurance product that provides guaranteed coverage until age 100 (and beyond) with level premiums that never increase, but unlike whole life, it builds no cash value, pays no dividends, and has no savings or investment component. It's the most affordable form of permanent life insurance in Canada — typically 30–50% cheaper than participating whole life — making it ideal for people who need a guaranteed death benefit for life without the complexity or cost of a cash-value policy.

What Is Term-100 Life Insurance?

Term-100 — also called "term to 100" or "T-100" — is a life insurance product that guarantees coverage until the insured reaches age 100. Premiums are level (fixed) for the entire premium-paying period, and the death benefit is guaranteed never to decrease. Upon reaching age 100, the policy is considered paid up and the death benefit remains in force with no further premiums required.

Unlike whole life insurance, term-100 does not build cash value, does not participate in the insurer's investment returns, does not pay dividends, and has no surrender value if you cancel the policy. Unlike standard term life insurance (10, 20, or 30-year terms), term-100 does not expire after a set period — it lasts your entire lifetime.

In essence, term-100 is pure, permanent death benefit protection at the lowest possible cost. Every dollar of premium goes toward covering the insurance risk and the insurer's expenses. There is no savings component, no investment account, and no flexibility to borrow against the policy or withdraw funds. It is the simplest form of permanent life insurance available in Canada.

The Canadian Life and Health Insurance Association (CLHIA) classifies term-100 as permanent life insurance because the coverage extends to age 100 and beyond. The Financial Services Regulatory Authority of Ontario (FSRA) regulates it under the same framework as other permanent products.

How Term-100 Differs from Regular Term and Whole Life

Term-100 occupies a unique position in the Canadian life insurance landscape. To understand where it fits, let's compare it directly to the two products it sits between — a 20-year renewable term policy and a participating whole life policy. For a broader comparison, see our differences between term and whole life insurance guide.

Feature	20-year term	Term-100	Participating whole life
Coverage duration	20 years (renewable)	Lifetime (to age 100+)	Lifetime
Premium structure	Level for 20 yrs, then increases sharply at renewal	Level to age 100	Level for life
Cash value	None	None	Yes — grows tax-deferred
Dividends	None	None	Yes — annual, not guaranteed
Surrender value	None	None	Yes — cash surrender value
Policy loans	No	No	Yes — borrow against cash value
Conversion privilege	Yes — convert to permanent	No (already permanent)	N/A (already permanent)
Premium cost	Lowest	Middle	Highest
Ideal use	Temporary needs (mortgage, children)	Permanent need, budget-conscious	Estate planning, wealth accumulation

Key takeaway: Term-100 gives you the permanence of whole life at a fraction of the cost, but you sacrifice all cash value and flexibility features. It's a trade-off: you get lifetime coverage and level premiums, but you lose the ability to build equity in the policy, access funds through loans or surrenders, or benefit from dividend growth.

Who Is Term-100 Designed For?

Term-100 serves a specific niche in the Canadian insurance market. It's best suited for people who have a permanent insurance need but don't want or need the savings component of whole life:

Estate equalization

If you own a family business or cottage and plan to leave it to one child, you may need a permanent death benefit to provide an equal inheritance to your other children. Term-100 guarantees that death benefit will be there whenever you die, at a lower cost than whole life. Since the goal is purely death benefit (not cash value or retirement income), the absence of cash value is irrelevant.

Final expense and estate tax coverage

When you die, your estate faces costs: funeral expenses ($8,000–$15,000), probate fees (up to 1.5% of estate value in Ontario), legal fees, and potential deemed disposition taxes on registered accounts and capital property. A term-100 policy with a face amount of $50,000–$200,000 ensures your estate has guaranteed funds to cover these costs without depleting the inheritance.

Charitable giving

If you want to leave a guaranteed gift to a charity, naming the charity as the beneficiary of a term-100 policy ensures a specific amount will be donated upon your death. The premium payments may generate a tax credit, and the death benefit passes directly to the charity without passing through the estate or being subject to probate.

Budget-conscious permanent coverage

Some people need permanent coverage (because they have a lifelong dependent, a permanent estate planning need, or simply want guaranteed coverage regardless of how long they live) but cannot afford whole life premiums. Term-100 provides that permanent guarantee at a significantly lower cost. If building cash value isn't a priority, term-100 delivers the core benefit — guaranteed permanent death benefit — at the lowest price.

Supplementing existing coverage

Many Canadians combine a large term policy (for the high-coverage, temporary need) with a smaller term-100 policy (for the permanent need). For example, a 40-year-old might carry $1,000,000 of 20-year term to protect the family during the mortgage years, plus $250,000 of term-100 to ensure a permanent estate benefit. This layered approach balances cost and coverage.

Cost Comparison: Term-20 vs Term-100 vs Whole Life by Age

The following table shows approximate monthly premiums for a $500,000 policy on a non-smoking male in preferred health, across three product types. For more detailed rate breakdowns, see our whole life vs term life cost comparison by age and life insurance rates by age guides.

Age at purchase	20-year term (monthly)	Term-100 (monthly)	Participating whole life (monthly)
Age 30	$28	$125	$260
Age 40	$42	$175	$385
Age 50	$95	$285	$620
Age 60	$245	$485	$1,050

What to notice: At age 40, a 20-year term costs $42/month — but it expires at age 60, and renewing at that point could cost $400+/month. Term-100 costs $175/month but is guaranteed to age 100 and beyond. Whole life at $385/month provides the same permanent coverage plus cash value, dividends, and flexibility. The question is whether those additional features are worth the extra $210/month.

Over 30 years, the total premiums for each product look like this for a 40-year-old:

20-year term: $42 × 12 × 20 = $10,080 (but no coverage after age 60 unless renewed at much higher rates)
Term-100: $175 × 12 × 30 = $63,000 (coverage continues to age 100+, no cash value)
Whole life: $385 × 12 × 30 = $138,600 (coverage continues for life, with approximately $200,000–$350,000+ in cash value depending on dividends)

Advantages of Term-100 Life Insurance

1. Cheapest permanent coverage available

Term-100 is the lowest-cost way to guarantee a death benefit that lasts your entire life. By stripping out cash value, dividends, and the participating account overhead, insurers can offer permanent coverage at premiums 30–50% lower than whole life. If your goal is simply to ensure your beneficiaries receive a specific sum whenever you die, term-100 delivers that guarantee at the lowest price.

2. Level premiums for life

Unlike renewable term insurance — where premiums skyrocket at renewal (a $42/month term-20 at age 40 could jump to $400+/month at age 60) — term-100 premiums are guaranteed to remain level. You pay the same amount from the day you buy the policy until you turn 100 (or until death, whichever comes first). This predictability makes long-term budgeting straightforward.

3. Simplicity

Term-100 is the simplest permanent life insurance product. There are no dividend options to evaluate, no cash value projections to analyze, no participating account performance to monitor, no illustration columns to decode, and no policy loan strategies to manage. You pay the premium; the insurer pays the death benefit. Period.

4. Guaranteed death benefit

The death benefit is contractually guaranteed by the insurer and does not depend on dividend performance, investment returns, or any variable factor. As long as premiums are paid, the full face amount will be paid to your beneficiaries — tax-free — whenever you die. There are no non-guaranteed components, no illustrations to worry about, and no risk that projected values won't materialize.

5. No market or dividend risk

With whole life, a portion of your premium's value depends on the insurer's dividend performance — if dividend rates decline, your non-guaranteed cash value and death benefit projections fall short. With universal life, your cash value depends on investment returns. Term-100 has none of this uncertainty. Every value in your policy is guaranteed from day one.

Disadvantages of Term-100 Life Insurance

1. No cash value — ever

This is the biggest drawback. After paying $175/month for 30 years ($63,000 total) on a term-100 policy, you have built zero equity in the policy. If you cancel, you get nothing back. With whole life, you'd have $200,000–$350,000 in cash value after the same period. If there's any chance you'll need to access funds from your policy — for retirement income, emergencies, or business needs — term-100 is the wrong product.

2. No dividends or growth potential

Participating whole life policies benefit from the insurer's investment performance through annual dividends. Over 20–30 years, dividends can significantly increase both the cash value and death benefit — sometimes doubling the original face amount. Term-100 offers no such upside. The death benefit is fixed from day one. For a detailed look at how dividends drive growth, see our cost comparison guide.

3. No flexibility

Whole life and universal life offer considerable flexibility: policy loans, partial surrenders, dividend option changes, paid-up conversion, premium holidays (universal life). Term-100 offers almost none of this. If your financial situation changes and you need to reduce coverage, increase coverage, access cash, or restructure the policy, your options are extremely limited. The only significant option is to cancel the policy — and receive nothing.

4. No conversion privilege

Standard 10, 20, and 30-year term policies include a conversion privilege that lets you convert to a permanent policy (whole life or universal life) without a new medical exam. This is enormously valuable if your health deteriorates. Term-100 is already permanent, so there is no conversion feature. If you later decide you want cash value or dividends, you'd need to apply for a new policy — subject to current health, age, and underwriting.

5. Declining availability

Over the past decade, several Canadian carriers have discontinued term-100 for new sales. The product has become less popular as universal life (with minimum-funded options) and non-participating whole life have emerged as alternatives that offer permanent coverage with some cash value at comparable or slightly higher premiums. Fewer carriers offering term-100 means less competition and potentially fewer pricing options.

Which Canadian Carriers Offer Term-100?

As of 2026, term-100 availability varies by carrier. The following table summarizes the current landscape. Because product availability changes frequently, we recommend confirming current offerings through a licensed independent advisor or by requesting a quote through LowestRates.io.

Carrier	Term-100 available (2026)	Notes
Canada Life	Yes	Available through advisor channel; competitive pricing for ages 35–55
Manulife	Limited	Available in some provinces; may be replaced by non-par whole life
iA Financial (Industrial Alliance)	Yes	Strong term-100 product; available nationwide
Empire Life	Yes	Competitive for smaller face amounts ($100K–$250K)
Assumption Life	Yes	Available for ages 18–80; no medical option for smaller amounts
Sun Life	No (discontinued)	Replaced by non-participating whole life and universal life
Desjardins	No (discontinued)	Now offers non-par whole life as alternative
Equitable Life	No (discontinued)	Focuses on participating whole life and universal life

The trend is clear: several major carriers have moved away from term-100 in favour of non-participating whole life (which offers some guaranteed cash value) and universal life (which offers investment flexibility). However, the remaining carriers still provide competitive options, and for the right buyer, term-100 remains a strong product.

When to Choose Term-100 vs Other Options

Choosing the right life insurance product depends on your specific needs, budget, and financial goals. Here's a decision framework:

Choose term-100 when:

You need permanent coverage that is guaranteed for life.
You have no need for cash value — you won't use the policy as a savings vehicle, retirement income source, or collateral for loans.
You want the lowest possible premium for permanent coverage.
Your goal is a guaranteed death benefit for estate equalization, final expenses, charitable giving, or debt coverage.
You prefer simplicity — no illustrations to decode, no dividend options, no investment decisions.
You plan to keep the policy in force until death and never cancel it.

Choose whole life instead when:

You want cash value growth that you can access through policy loans or partial surrenders.
You want dividends that compound over time and increase both your cash value and death benefit.
You plan to use the policy for retirement income supplementation or corporate wealth strategies.
You value flexibility — the ability to change dividend options, reduce coverage, take premium holidays, or restructure the policy.
You can afford the higher premiums and have a 20+ year time horizon to maximize the compounding effect.

Choose regular term instead when:

Your insurance need is temporary — covering a mortgage, protecting children until they're financially independent, or replacing income during working years.
You want the lowest possible cost and are comfortable with coverage expiring at the end of the term.
You want the conversion privilege to convert to permanent coverage later without a medical exam.
You prefer to "buy term and invest the difference" — using the premium savings vs term-100 or whole life to invest in RRSPs, TFSAs, or other vehicles.

Alternatives to Term-100 in 2026

As term-100 availability declines, several alternative products serve similar needs:

Non-participating whole life

Non-participating (non-par) whole life offers permanent coverage with guaranteed cash values but no dividends. Premiums are higher than term-100 but lower than participating whole life. The guaranteed cash value means you recover some of your premiums if you cancel. This is the closest alternative to term-100 and is offered by most major Canadian carriers.

Minimum-funded universal life

Universal life (UL) allows you to fund the policy at the minimum cost of insurance, which makes it function similarly to term-100 — permanent coverage, level or near-level premiums, minimal cash value. However, UL is more complex, with variable cost structures (level COI vs yearly renewable COI) and investment account decisions. If funded at the minimum, UL can be competitively priced with term-100 while offering slightly more flexibility.

Layered term strategy

Instead of buying one permanent policy, you could layer multiple term policies — for example, a 30-year term that covers the majority of your need, plus a smaller 20-year term for the mortgage period. When each term expires, you let it go or convert to permanent coverage. This approach costs less than term-100 in the early years but requires you to reassess coverage at each renewal or conversion point. For how term policies interact with costs over time, see our term vs whole life differences guide.

Term-100 and the "Buy Term and Invest the Difference" Debate

One of the oldest debates in personal finance is whether to buy cheap term insurance and invest the premium savings, or buy permanent insurance that builds cash value. Term-100 adds an interesting wrinkle to this debate because it is permanent (so the coverage doesn't expire) but has no cash value (so you're not building equity).

Consider a 40-year-old choosing between term-100 at $175/month and whole life at $385/month. The $210/month difference, invested in a TFSA earning 6% annually for 25 years, would grow to approximately $146,000 — tax-free. Meanwhile, the whole life policy's non-guaranteed cash value might be $350,000 at age 65, but the guaranteed value might only be $180,000.

If you're a disciplined investor who will actually commit the savings to a TFSA or RRSP every month for 25 years, the "buy term-100 and invest the difference" strategy can produce competitive results — with the added benefit that your TFSA investments are fully liquid and under your control. But if you're not disciplined, the forced savings mechanism of whole life has its own value. There is no universally correct answer — it depends on your behaviour, tax situation, and goals.

Tax Considerations for Term-100

Term-100 has straightforward tax treatment because there is no cash value:

Death benefit: Paid tax-free to named beneficiaries, just like any other life insurance policy in Canada.
Premiums: Not tax-deductible for individuals. For corporately-owned policies used as collateral for business loans, premiums may be partially deductible under certain conditions.
Capital dividend account (CDA): If a corporation is the beneficiary, the death benefit (minus the adjusted cost basis) is credited to the CDA and can be distributed to shareholders tax-free.
No surrender tax implications: Since there is no cash value, cancelling a term-100 policy has no tax consequences — there is nothing to tax.

For corporate estate planning, term-100 can be an efficient tool because the premiums are lower than whole life, reducing the annual cost to the corporation, while still generating a CDA credit at death. This is a strategy worth discussing with both your insurance advisor and accountant.

Frequently Asked Questions

Does term-100 life insurance have any cash value?

No. Term-100 life insurance does not build cash value, does not pay dividends, and does not have a savings or investment component. Every dollar of premium goes toward the cost of insurance and the insurer's expenses. If you cancel a term-100 policy, you receive nothing — there is no cash surrender value. This is the fundamental difference between term-100 and whole life insurance. Term-100 is designed purely for permanent death benefit protection at the lowest possible cost, without the wealth accumulation features of whole life or universal life.

Is term-100 cheaper than whole life insurance?

Yes, significantly. Term-100 premiums are typically 30–50% lower than participating whole life premiums for the same face amount and insured profile. For example, a 40-year-old non-smoking male might pay $320/month for a $500,000 whole life policy but only $175/month for the same coverage as term-100. The savings come from the absence of cash value accumulation, dividends, and the participating account overhead. However, term-100 provides no cash value access, no retirement income potential, and no flexibility — so the lower premium reflects a simpler product with fewer features.

What happens when I turn 100 on a term-100 policy?

When the insured reaches age 100, most term-100 policies are considered 'paid up' — premiums stop and the death benefit remains in force for the rest of the insured's life. Some older term-100 contracts required premiums until death, so check your specific policy wording. With Canadian life expectancy increasing, reaching age 100 is becoming more common, and the paid-up provision ensures your beneficiaries still receive the full death benefit whenever you pass away, even if you live well beyond 100.

Can I convert a term-100 policy to whole life insurance?

Generally, no. Unlike renewable term policies (10, 20, or 30-year term) that typically include a conversion privilege allowing you to convert to permanent coverage without a medical exam, term-100 policies are already permanent and do not include a conversion option. If you want the flexibility to convert to whole life in the future, you should purchase a convertible term policy instead. Some carriers may offer optional riders on term-100 policies, but a conversion privilege to whole life is not standard.

Which Canadian insurance companies still sell term-100?

Term-100 availability has decreased over the past decade as many carriers have focused on whole life and universal life products. As of 2026, carriers that offer or have recently offered term-100 include Canada Life, Manulife, Industrial Alliance (iA Financial), Empire Life, and Assumption Life. However, product availability changes frequently — some carriers have discontinued term-100 for new sales while honouring existing policies. Contact a licensed independent advisor or request a quote through LowestRates.io to see which carriers currently offer term-100 in your province.

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