Life Insurance for Hazardous Activities in Canada

Getting life insurance for hazardous activities in Canada is definitely possible, and there are plenty of life insurance companies which can provide coverage to those who are thrill-seekers and enjoy participating in hazardous activities. There are certain things that you should know if you or a loved one is looking to get a life insurance policy and they take part in hazardous activities or extreme sports. 

In this article:

• What is considered a hazardous activity?
• How does taking part in hazardous activities affect life insurance coverage?
• What life insurance companies consider to be hazardous activities
• The cost of life insurance for someone who participates in hazardous activities
• Best life insurance policies for someone who participates in hazardous activities
  • Underwritten policy
  • Guaranteed or No Medical policy
  • Simplified policy
• How much does your hazardous activity affect your life insurance?
• What happens if I take part in hazardous activities when I already have life insurance
• Are There Any Exclusions for Life Insurance for Snow Sports?
• Frequently asked questions (FAQs) about hazardous activities and life insurance

What is considered a hazardous activity?

Life insurance companies consider hazardous activities to be activities that are high-risk, and can be listed as any sport or hobby that has a high risk of injury. This can include a high-risk job such as a pilot, but in this blog we will be specifically talking about high-risk or hazardous recreational activities. In most cases, people who participate in high-risk or hazardous recreational activities can indeed get some form of life insurance or disability insurance.

Thus, the answer to the question of “can I get life insurance if I take part in hazardous activities?” is YES!

With that being said, it is important to note that there are some life insurance policies that will not provide you with coverage if you take part in high-risk or hazardous activities. This can be from outright declining you any form of coverage or it can be from declining you a payout in the event of disability or death due to participating in a hazardous activity. This is all based on the fact that risk of disability and risk of death is increased when participating in a hazardous activity. To learn more about what underwriting is and how it relates to your life insurance read our complete guide about the different kinds of underwriting that exist.

How does taking part in hazardous activities affect life insurance

Since there is so much risk involved in hazardous activities, there are many ways that it can affect your life insurance. There are some exclusions in life insurance policies that will not give you a payout in the event of disability caused by an accident during your participation in a high-risk activity. There are also exclusions such as not giving your beneficiaries an insurance payout in the event of your death due to participating in a hazardous activity. These all fall into the underwriting guidelines, and even though there are companies that will insure your, you will probably have to pay a higher life insurance monthly premium. Some insurance companies will definitely insure you but will have some clauses that include deducting money from your insurance payout based on the activity you were participating in which caused your death. 

What life insurance companies consider to be hazardous activities

There are multiple activities that can be listed as hazardous activities. It is not to say that life insurance companies will not allow you to fulfill your dream of skydiving, snowboarding, trying out motor vehicle sports, or rock climbing one day but rather, they are interested in knowing how often you do these activities. Typically, if you participate in a hazardous activity more than 2 times a year, then you are considered as someone who takes part in hazardous activities, but there are even more exceptions, for example do you rock climb in a climbing gym, or on a mountain, this is taken into consideration as well. For someone who regularly goes to a climbing gym they will receive standard insurance, but for someone who takes trips to go mountain climbing every other month, there will be some clauses, and changes to their life insurance coverage because of the risk.

Insurance companies also might include some clauses to your life insurance policy that include not paying benefits to you in the event of disability or death during your participation in a hazardous activity. It is really important to be aware of what is included in your life insurance policy, and what is not included in your life insurance policy and to know which life insurance policy is right for you and your recreational hobbies. Contact Protect Your Wealth today to learn more about how your recreational hobby might affect your life insurance.

Here is a list of what some insurance companies might consider as being a hazardous activity:

Here is a list of what some insurance companies might consider as being a hazardous activity:

• Snow sports (skiing, snowboarding, snowmobiling)
• Skydiving, scuba diving
• Sport aviation
• Climbing (Rock, ice/snow, mountain climbing)
• Motor vehicle racing

The cost of life insurance for someone who participates in hazardous activities

There are a number of things that life insurance companies look out for during the underwriting stage of rating someone. People who take part in hazardous activities are sometimes rated differently even if they are in good health and don’t have any medical conditions. For someone who participates in hazardous activities, there is an additional list of things that the underwriter will need to know to determine your life insurance coverage. The following list shows some of the underwriting considerations which determine how hazardous activities can affect life insurance.

This list includes, but is not limited to:

• How often do you take part in the listed hazardous activities (frequency)
• How risky is the activity (risk factor)
• Some insurance companies will consider how much altitude you gain when participating in an activity such as skydiving, climbing, and snowboarding
• Your experience in said activity
• Are you certified in the said activity? eg: do you have a scuba diving certificate?
• Your personal medical history
• The location where you participate in the activity
• The terrain of where you participate in the activity

Some insurance companies will also require you to fill out a questionnaire related to the hazardous activity that you participate in. Alternatively, aside from the rating that you will receive from taking part in the hazardous activity, you will also have some exclusions to your policy when you acquire one. These exclusions typically cost a couple dollars per thousand dollars of receive coverage, eg: you will be charged an extra $3 dollars per $1000 dollars of coverage that will be added to your life insurance benefit if you are above 4000 meters when climbing.

Again, these underwriting questions will decide your rating which in turn will alter the price of your coverage, the kind of coverage, and the amount of coverage you’re eligible for. Remember that there are always other options available that will guarantee you life insurance coverage without many questions about any activities you participate in!

Best life insurance policies if you participate in hazardous activities

The best life insurance policies for those participate in hazardous activities range depending on a number of factors; each person might have a set of unique factors that might make a certain life insurance policy more appealing to them. Luckily, people who participate in hazardous activities are able to get most life insurance policies. It is definitely possible to get a guaranteed life insurance, simplified life insurance or even a fully underwritten life insurance policy. 

Underwritten Policy

To get a fully underwritten policy this will require you to take a questionnaire about the hazardous activity that you participate in and there will be a process to understand more about your ability, experience, and frequency in participating in the hazardous activity. There are benefits to this evaluation because depending on your results, you can get a preferred or standard rate and the cost of your life insurance might just be slightly more than someone who doesn’t take part in a hazardous activity. This will allow you to have a higher coverage amount and will allow you to have access to different kinds of life insurance policies which have great benefits and features that might better suit your needs and wants. Luckily, there are a lot of life insurance companies that have underwritten policies available for those who participate in a hazardous activity. There will only be some exclusions in certain policies as mentioned earlier, which will increase the cost of your life insurance benefit by a certain amount per $1000 of coverage. Also, even though there are underwritten policies available that can give you a standard or preferred rating, there are some that might just make your premiums slightly more expensive than a standard rating but this will still be very beneficial considering that underwritten policies usually have larger coverage amounts and better features than other policies. It is certainly possible to get an underwritten policy if you are someone who participates in a hazardous activity, contact us today to find out how! 

Guaranteed or No Medical Policy

Guaranteed or no medical policies can benefit those who do not want to go through a stringent questionnaire, medical evaluation, or those who are declined from acquiring an underwritten policy. This would be ideal for those who participate in a riskier hazardous activity, or do an extreme version of a hazardous activity, for example certain insurance companies will not provide you with an underwritten policies if you climb in foreign countries outside of North America, if the terrain is ice or snow, and if you go above a certain altitude.

Keep in mind that there are many insurance companies that will allow you to get an underwritten policy even if you do participate in an extreme version of a hazardous activity. A no medical or guarantee policy can limit the amount of coverage you can receive for your policy and can have a slightly higher premium cost but it is easier to obtain. It is important to take note that, most no medical exam term life insurance policies will provide you with $500,000 coverage and no medical exam whole life insurance policies will only offer you $50,000 or less in coverage. These amounts are dramatically lower than the amounts you can acquire with a fully underwritten policy. Luckily, if you are interested in medical and guaranteed life insurance, it is offered by most Canadian insurance companies.

Simplified Policy

Simplified policies are available from many life insurance companies for people who are participating in hazardous activities. These simplified policies have a mixture of traits from fully underwritten policies and guaranteed policies. This is an attractive policy for those who want a higher coverage amount and more features than a no-medical or guaranteed policy. These kinds of policies will require you to answer limited medical questions, but don’t require you to visit a doctor and get an examination. The coverage amount and coverage features can depend on basic things such as your health, age, smoking status and a few other factors.

What happens if I take part in hazardous activities when I already have life insurance

If you already have a life insurance policy and you start participating in a hazardous activity it can be a major risk to your life insurance benefit. Although health conditions that are developed do not affect your life insurance coverage, dying due to taking part in a hazardous sport can lead to your life insurance company not paying your beneficiary your insurance benefit. Accidents do happen and if you aren’t participating frequently in a hazardous activity this won’t always affect your life insurance benefit. If you are regularly participating in a hazardous sport and already have life insurance, it is best to check in with your life insurance provider to see how this can affect your life insurance policy and benefit. Canadian life insurance companies cannot revoke or change your life insurance coverage or policy once it is effective but there are many exclusions and clauses in life insurance policies. 

How much does your hazardous activity affect your life insurance?

As mentioned earlier, when taking a look at underwritten policies there are plenty of exclusions that can affect your insurability. Each hazardous activity has unique factors that life insurance companies consider when rating you. To find out some of the general factors that life insurance companies will consider when underwriting you for your sport, take a look below. This graphic shows some of the factors that are considered during the underwriting process for each sport that is listed as a hazardous activity: 

Skydiving

• Applicants who have tried skydiving once and have no intention of skydiving again: standard rating
• Other: exclusions or $2.50 per thousand in coverage
• High risk jump: decline

Snow sports

• Most average recreational, participants are available for standard rating
• ‘Out-of-Bounds’ activities, including helicopter or CAT vehicle drop offs etc., may require a rating $2.50 per million or decline, and/or exclusions

Climbing

• Indoor climbing: standard
• Hiking/trekking/trailing: standard
• Other (rock/ice climbing): exclusion or $2.50 per thousand to decline
• Depending on the height of cliffs and location, generally can offer standard coverage, otherwise $2.50 or $3.50 per million

Scuba diving

• Amateur scuba diving, not involved in any hazardous diving activities ~< 100ft: standard
• Other: exclusion or $2.50 to $10.00 per thousand
• Snorkeling only: standard
• With comorbid risk factors (heart disease, epilepsy, overweight, etc.): decline

Motor vehicle sports

• Standard to Exclusion or Flat Rating of $2.50 per thousand to $15.00 per thousand
• Depending on type of vehicle and type of racing
• Racing questionnaire
• Personal driving record may be considered

Aviation (Recreational)

• Depends of type of flying activity, destinations, amateur or professional and medical history
• Possible range from standard to a rating to decline
• Helicopter or fixed wing: Exclusion or rating from $2.50 to $5.00 per thousand
• Aviation questionnaire

Are There Any Exclusions for Life Insurance for Snow Sports?

Yes, for any hazardous activities, there are some exclusions that do exist. The reason that they have these exclusions is because of the fact that there is sometimes too high of a risk if clients take part in an extreme form of their hobby/activity which makes the risk of death much higher than usual.

This does exist for snow sports as well, what people who take part in snow sports need to look out for is: avalanches 

If the insurance holder died or was hurt while taking part in a snow sport, such as snowmobiling, cross-country or downhill skiing, snowshoeing, etc., in an area where an avalanche warning with a high or extreme danger level has been posted, then they are excluded from receiving their death benefit.

The number of applicants engaging in activities like hiking, heli-skiing, and snowmobiling in remote locations where avalanches are a possibility has increased, according to underwriters. Although customers might think there is little risk involved, underwriters are aware that avalanche-related deaths do occur in Canada. Thus, you must be wary of avalanche warnings and avoid those places so that you do not risk both your life and your life insurance policy.

Frequently asked questions (FAQs) about hazardous activities and life insurance

Finding the right life insurance for you

If you’re someone who participates in extreme sports or hazardous activities you can still find affordable life insurance! Working with a life insurance advisor can help you create the perfect life insurance plan and package for your needs.

At Protect Your Wealth, we work with and compare policies and quotes from the best life insurance companies in Canada to create the best solution for you and your needs. We’ve been providing expert life insurance solutions since 2007, including no medical life insurance, term life insurance, and permanent life insurance, to build the best package to give you the protection you need.

Contact Protect Your Wealth or call us at 1-877-654-6119 to talk to an advisor today! We’re proudly based out of Hamilton, and service clients anywhere in Ontario, Alberta and British Columbia; including areas such as Ancaster, Medicine Hat and Maple Ridge.