Written by Ron Cooke, President & Founder of Strategic Wealth Protection Partners in Ontario, CEA®, Member of the Estate Planning Council Canada
How much life insurance should you have at age 60?
The amount of life insurance you need at age 60 depends on your financial situation, not your age alone.
Some Canadians may only need enough to replace income or cover final expenses, while others need several million dollars to pay estate taxes, protect a business, or preserve family wealth. A good estate plan considers your assets, debts, future tax liabilities, and the legacy you want to leave behind.
The goal is to make sure your family inherits your wealth instead of having it reduced by unnecessary taxes or forced asset sales.
What are the benefits of getting life insurance in your 60s?
Life insurance in your 60s can provide financial security, tax efficiency, and peace of mind for both you and your family.
It can create immediate liquidity to pay estate taxes, allowing cottages, businesses, investment properties, and family investments to stay in the family rather than being sold to pay the Canada Revenue Agency.
Permanent life insurance also allows investments inside the policy to grow on a tax sheltered basis while providing a tax free payout at death. For many Canadians, it becomes one of the most effective tools for protecting a lifetime of hard work.
What are the four main types of life insurance?
- Term to 100 Insurance provides guaranteed lifetime coverage with level premiums but does not build cash value. It is frequently chosen by Canadians who want permanent protection at a lower cost than cash value policies.
- Term Life Insurance provides coverage for a specific period, such as 10, 20, or 30 years. It is often the most affordable option and is best suited for temporary needs such as income replacement or mortgage protection.
- Whole Life Insurance provides guaranteed lifetime coverage, builds tax sheltered cash value, and pays a tax free death benefit. It is commonly used for estate planning and long-term wealth preservation.
- Universal Life Insurance combines lifetime insurance with tax sheltered investment growth and offers flexibility in how the policy is funded and invested. It is often used by individuals looking to combine insurance with long-term financial planning.
What is the best type of life insurance for someone in their 60s?
The best type of life insurance depends on your financial goals.
If your priority is protecting your estate, reducing taxes, and preserving wealth for your family, participating whole life insurance or universal life insurance often provide the greatest long-term benefits. Both allow investments to grow on a tax sheltered basis and create a tax free payout at death, while corporate owned policies can also allow proceeds to be distributed tax free to shareholders through the Capital Dividend Account.
The right solution should always be based on a comprehensive estate planning review rather than the insurance product alone.
Who doesn’t need life insurance?
Not everyone needs life insurance.
If you have little or no estate tax exposure, no financial dependents, sufficient assets to meet your goals, and no desire to leave additional wealth to family or charity, life insurance may not be necessary.
However, many Canadians underestimate the taxes that can arise at death on RRSPs, RRIFs, corporations, cottages, and investment properties. Before deciding you do not need insurance, it is worth calculating your future estate tax liability so you can make an informed decision.
$10M Life Insurance for Estate Planning Example
Amir and Simar* are both 50 years old and have built a successful business with approximately $40 million of assets, most of which are held inside a holding company.
After completing our review of the seven estate planning strategies, we determined that a corporately owned participating whole life insurance policy combined with an Immediate Financing Arrangement (IFA) would provide the greatest long-term benefit.
Rather than leaving all of their capital invested in taxable corporate investments, they contributed $500,000 each year for 10 years into the policy. After contributing $5 million, the policy had accumulated approximately $5.9 million in tax sheltered cash value, while the death benefit had grown to more than $22 million.
By age 85, the policy was projected to have more than $21 million in cash value and over $30 million of life insurance, depending on future dividend performance. Because the policy was owned by the corporation, the death benefit would also create a substantial Capital Dividend Account, allowing most of the proceeds to be distributed tax free to the shareholders.
Without life insurance, paying a projected $20 million estate tax bill could require withdrawing between approximately $26 million and $47 million from the corporation, depending on the type of corporate assets and applicable taxes.
By using an IFA, Amir and Simar were also able to borrow against the policy and reinvest those funds back into their business, allowing both their company and their insurance strategy to continue growing while potentially saving their family millions of dollars over time.
*Names and identifying details have been changed to protect client confidentiality.
Comparison: No Life Insurance vs. Participating Whole Life Insurance + IFA
This table breaks down the previous example of Amir and Simar who are successful business owners in their 50s.
Their business has approximately $40 million of assets, most of which are held inside a holding company. Here’s what their estate planning scenario looks like with and without whole life insurance and an IFA strategy.
| Scenario | No Life Insurance | Participating Whole Life Insurance + IFA Strategy |
| Corporate assets | $40 million | $40 million |
| Annual contribution | $0 | $500,000/year for 10 years |
| Total contributions | $0 | $5 million |
| Tax-sheltered cash value after 10 years | $0 | $5.9 million |
| Projected cash value at age 85 | $0 | Over $21 million |
| Projected death benefit at age 85 | $0 | Over $30 million |
| Projected estate tax liability | $20 million | $20 million |
| Estimated amount that may need to be withdrawn from corporation to pay estate taxes | $26 million–$47 million, depending on the type of corporate assets and applicable taxes | $0 – Insurance proceeds provide tax-efficient liquidity, significantly reducing the need to withdraw corporate assets |
| Access to capital during lifetime | No insurance-backed financing strategy | Borrow against the policy through an Immediate Financing Arrangement (IFA) and reinvest the funds back into the business |
| Wealth passed to the next generation | Estate value may be substantially reduced by taxes | More of the estate can be preserved for family through tax-efficient planning |
All numbers are illustrative values only. Cash values and death benefits depend on policy design, insurer, and future dividend performance.
Where should I buy life insurance in Ontario?
There is no single insurance company that is the best choice for everyone.
However, the best place to purchase life insurance in Ontario is through an independent advisor who begins with a comprehensive estate planning process rather than recommending a policy first.
At Strategic Wealth Protection Partners (SWPP), our Living Estate Planning Process evaluates your assets, future estate taxes, retirement goals, and the seven different planning options available before determining whether life insurance is the right solution. This planning first approach helps ensure you buy the right amount and type of insurance while integrating it into your overall tax, retirement, and estate plan.
Our goal is to help you preserve more of your wealth so that more of it reaches the people you love instead of being lost to unnecessary taxes and fees.
Turn Life Insurance Into a Tax-Efficient Retirement Strategy
If you’re exploring strategies like an IRP or IFA, you’re already thinking beyond traditional planning.
These strategies can be powerful when designed correctly.
At Strategic Wealth Protection Partners, we help Ontario business owners, real estate investors, and high-income professionals use life insurance to:
- Supplement retirement income
- Access capital in a tax-efficient way
- Reduce taxes on their estate
- Preserve wealth across generations
The challenge is that these strategies involve multiple moving parts, including insurance, lending, and tax rules.
A small mistake in structure can significantly impact the outcome.
That’s why we focus on building fully integrated plans, not just recommending policies.
If you’re considering an advanced life insurance strategy, we’ll help you understand exactly how it works and whether it makes sense for your situation.
Schedule a Life Insurance Clarity Call
For high-income earners, business owners, and real estate investors, the biggest risk isn’t a lack of growth.
It’s taxation.
Without proper planning, a large portion of your estate will be lost to taxes, fees, and forced asset sales. Life insurance can help offset these costs and preserve more of your wealth for your family. But only if it’s used correctly.
But not every strategy is right for every situation.
That’s where SWPP comes in.
We design life insurance strategies as part of a complete estate plan, so every decision supports your long-term goals, not just a product recommendation. And if life insurance isn’t the right move, we’ll tell you.
We’ll show you all the wealth preservation options that apply to your exact situation, including living trusts, estate freezes, and life insurance.
Discover how to reduce and avoid taxes and leave a rock-solid legacy for the ones you love.
Read More
If you’re considering life insurance for estate planning, you may find these articles helpful:
- Is It Worth Buying Universal Life Insurance in Canada?
- How Much Life Insurance Should I Have at 40 Years Old?
- Can You Outlive Universal Life Insurance in Canada?
About the Author
RON COOKE, PRESIDENT & FOUNDER OF STRATEGIC WEALTH PROTECTION PARTNERS
With over 30 years in financial services, I’ve seen the challenges families face when a loved one passes—lost assets, unnecessary taxes, and emotional stress. That’s why I created the Living Estate Plan, a comprehensive process to protect assets, eliminate estate and probate fees, and create legacies that are remembered for many years to come.
This plan ensures your family receives not just your wealth, but a meaningful reminder of your care and love. Tools like The Final Word Journal capture your story, wishes, and essential details, offering clarity and comfort during difficult times.
Your final gift should be more than money—it should be peace of mind, cherished memories, and an organized estate.
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