Life Insurance When You Work for Yourself in BC

Maria runs a small cleaning business out of her townhouse in Burnaby. Most mornings she's loading supplies into her van before her kids have finished their cereal. Her husband works part time, the mortgage comes out on the first of the month, and every dollar the family spends starts with a job Maria books herself. She's the owner, the scheduler, and the payroll department. If something happened to her, all of it would stop at once.

That's the part self-employed people rarely say out loud. When you work for yourself, your income doesn't just support your family. It is the business. Which is exactly why life insurance deserves a closer look when you're your own boss.

No employer plan means no safety net by default

Employees often get some life insurance through work without thinking about it. A group plan, maybe one or two times salary. It's rarely enough on its own, but it's something.

When you're self-employed, that layer doesn't exist unless you build it. There's no HR department quietly deducting premiums from your paycheque. If you haven't set up coverage yourself, your family's plan B is whatever savings you've kept outside the business. For a lot of owners in Metro Vancouver, where housing costs eat most of the margin, that's thinner than they'd like.

Your business debts don't disappear with you

Here's what a policy can be sized to handle for a business owner:

• The family mortgage and household bills, same as anyone
• Business loans or lines of credit you've personally guaranteed
• A vehicle or equipment lease someone would still owe on
• Money to keep the business running, or wind it down in an orderly way, while your family figures out next steps
• Income replacement for the years your family would have counted on your earnings
• Final expenses and any taxes owing on your estate

That middle section is the piece employees never have to think about. Many small business loans in Canada come with a personal guarantee. If the owner dies, the debt doesn't. A life insurance payout can clear those obligations so a grieving spouse isn't left negotiating with a lender.

Term coverage often fits this season of life

Term life insurance covers you for a set period, often 10, 20, or 30 years, and it's usually the most affordable way to get a meaningful amount of coverage. For an owner with a young family, a mortgage, and a business loan, a term policy can be matched to the years those obligations are heaviest.

Permanent insurance works differently. It's designed to last your whole life and can build cash value over time. For some incorporated business owners, a corporately owned permanent policy can play a role in longer-term planning. The rules get technical quickly, and the right structure depends on your corporation, your income, and your goals. This is genuinely a talk-to-someone situation, ideally alongside your accountant.

Neither type is automatically better. It depends on what you're protecting and for how long.

Don't forget the living benefits side

Ask any contractor or shop owner what actually scares them, and it's often not dying. It's getting sick or hurt and watching the business stall while the bills keep coming. Critical illness coverage pays a lump sum if you're diagnosed with a covered condition such as cancer, heart attack, or stroke. Disability coverage replaces part of your income if you can't work. Self-employed people don't get sick days, so these often matter as much as the life policy itself.

Buying coverage when your income is lumpy

Insurers ask about income, and self-employed income rarely fits in a tidy box. Good years, slow years, write-offs that shrink what shows on paper. An independent broker who works with self-employed clients regularly knows how insurers look at business income and which companies tend to be flexible about it. Because Milo is independent, he can compare policies from Canada's top insurers instead of fitting you into one company's mould.

Where to start

You don't need to have it all figured out before you ask questions. If you run a business anywhere around Burnaby, Coquitlam, or the rest of the Vancouver area, Milo offers a free, no-pressure call to talk through what you're protecting and what coverage could look like for your situation. He works in English and Tagalog, and the first conversation is just that, a conversation. Book a time that fits your schedule, even if that's after the last job of the day.