Moving provinces or leaving Canada

Moving within Canada

An existing policy usually comes with you, and nothing about it changes. Insurers are licensed province by province. But the contract you hold is still a contract. The coverage, the premium and the terms carry on as they were.

Two things do need attention.

Update your address with the insurer. This is not a formality. Lapse notices, annual statements and any letters about the policy go to the address on file. A notice that arrived at an old address still counts as a notice that was sent. The most common way a policy is lost in a move is simple. Nobody saw the letter.

Check your payment arrangement survived. People often change banks during a move. A broken pre-authorized debit (an automatic withdrawal from your account) makes no noise. See missed payments and lapse.

Some provinces have their own rules on beneficiary designations (who you have named to receive the money) and on estate matters. Moving is a sensible moment to review your designations in any case. If you are moving into or out of Quebec, that deserves specific attention. Quebec treats spousal designations differently from the common law provinces. See irrevocable beneficiaries.

Leaving Canada with an existing policy

The usual position is that an in-force policy stays in force.

The policy was underwritten and issued on the facts as they were at the time. Moving abroad afterwards does not, by itself, break the contract. It does not give the insurer grounds to cancel. The death benefit is usually payable no matter where death occurs.

Check your own contract rather than relying on that general rule. A minority of policies contain residency provisions.

The practical obstacles are matters of admin rather than law:

Paying the premium. Most Canadian insurers want payment from a Canadian bank account. Keeping one open is the simplest solution. It is easier to arrange before you go than after.

Staying reachable. Give the insurer an address that will work. Make sure someone in Canada knows the policy exists.

Currency and banking friction. Paying once a year rather than monthly means fewer transactions that can go wrong.

Claiming from abroad. A claim where death occurred outside Canada usually needs more paperwork. That includes proof of death that a Canadian insurer will accept. Sometimes it also needs translation and official certification. It is slower rather than impossible. See filing a claim.

Where you are moving to matters

Insurers pay attention to places under Canadian government travel advisories. That applies to living somewhere as well as travelling there.

For an existing policy, this usually changes nothing, because the assessment already happened. For a new application, a planned move to a region under advisory is a live underwriting question. It can lead to a flat extra, which is a fixed added charge on the premium. It can lead to an exclusion covering death in named countries. Or it can lead to a postponement. See travel, work and hobbies.

Buying new coverage from outside Canada

This is much harder than keeping what you have.

Canadian insurers issue policies to Canadian residents. Someone who has stopped being a resident usually cannot buy a new Canadian policy. The market for non-residents is narrow.

The practical point is simple: if you are leaving and you might want more coverage, apply before you go. Applying while you are still a resident is a very different matter from applying after the move. You still have a Canadian address and a Canadian medical record.

The same logic applies to conversion rights on existing term policies. Those are contract rights, and they usually survive a move. Using one from abroad is usually easier than buying something new.

Tax residency is a separate question

Whether you remain a Canadian resident for tax purposes depends on your residential ties. It does not depend on where you physically are. The Canada Revenue Agency sets the rules.

This does not usually affect whether a policy pays. It can affect the tax treatment of transactions involving the policy while you are alive. It can also affect the position of a beneficiary who does not live in Canada.

Some situations are truly complicated. One is where a policy has cash value and you are giving up residency. Another is where beneficiaries live abroad. In both, Canadian rules interact with the rules of the other country. That belongs with an accountant who handles cross-border matters, before the move rather than after.

A short checklist

Before moving within Canada: update your address, confirm the payment arrangement, and review beneficiary designations.

Before leaving Canada: do all of the above. Then keep a Canadian bank account. Apply for any extra coverage you may want while you are still resident. Check whether any conversion deadline is coming up. Tell someone in Canada what policies exist and where the paperwork is. Get cross-border tax advice if the policy has cash value.