What is direct insurance and how does it work in Canada?

Direct insurance can be a more transparent approach to insurance for many reasons. By purchasing insurance directly from an insurer, it may give you more control over which policy suits you and how much coverage you might need. Some insurers may be able to offer lower costs or coverage without a medical exam, all without using a third-party agent or broker.

Applying for direct insurance can be a quick and easy process, allowing you to do your own research and understand exactly what you’re getting out of your policy.

What is the definition of direct insurance?

As the name suggests, direct insurance allows you to purchase coverage directly from an insurance company – no middleman required.

Rather than going through a broker, you deal directly with the insurer. Direct insurance tends to be more streamlined, can offer faster quotes and offers a smoother application process. Generally, all it takes is a quick phone call with a licensed advisor to understand your coverage options and premium costs.

How does direct insurance work in Canada?

While insurance brokers can be helpful in terms of guiding you through the fine print, direct life insurance skips that middle step and puts you in control. If you're planning on purchasing direct life insurance, the process can often be easier and quicker than your typical insurance experience.

You'll normally start by contacting the insurance company of your choice via their website or by giving them a call. This is when you’ll receive a quote followed by details of the policy, and if you fit within the requirements, you can apply for the direct insurance you need.

The licensed advisor will help you choose the right coverage for you, and some insurers don’t require medical or blood tests to apply. Since there's no broker involved, you will do the application yourself, which usually means fewer questions and an easier approval process.

With many direct insurers, you can even secure coverage the same day you apply, but each provider has their own requirements and timelines.

What are the benefits of direct insurance?

If you're looking to save money and time when taking out an insurance policy, direct insurance can be the way to go.

Working directly with an insurer usually means there are no broker fees. Plus, you’ll likely secure a faster response time by communicating directly with the insurer, too.

Direct insurance can also give you more control over the cover you take out (including the ability to customize excess amounts, set waiting periods and add on extras that are relevant to your situation), meaning you know exactly what you’re covered for with your policy.

Are there any drawbacks to direct insurance?

An insurance broker's job is to offer advice on which policies, coverage amounts, and insurance providers are suited to your needs and financial situation.

If you're applying for direct insurance, you'll need to do your own research, compare insurers to understand coverage options, and choose the right policy for you – without external advice.

By buying insurance directly, you may be limited to the products offered by that specific insurer. This can result in limited options and potentially less flexible coverage.

Plus, it takes time to research, compare, and purchase policies when securing direct insurance. While you’ll likely receive quotes sooner, you’ll need to be comfortable navigating Product Disclosure Statements and insurance documents on your own, without the help of a broker.

What is the difference between insurance brokers and advisors?

The key difference between insurance brokers and advisors (sometimes known as insurance agents) is who each professional works for.

In the case of insurance brokers, these representatives usually have connections with a broad range of insurance companies. This means they can help you compare policies from multiple insurers rather than being tied to one specific insurance company.

On the flip side, advisors usually represent and work for one specific insurer. This means they have deep expertise in the specific products available from one insurance company. Plus, lucky for us Canadians, advisors can offer advice on which policy or level of cover might be right for your needs and situation, too.

Securing direct insurance means you’ll be working with an advisor from an insurance company to help you make an informed decision about your insurance options.

Discover the benefits of guaranteed final expense insurance

Now that you’re up to speed on how direct insurance works, you might be looking for ways to ease the financial burden on your loved ones after you’re gone.

While that payout from final expense insurance won't be as large as the payout from a traditional life insurance policy, it should be enough to cover final end-of-life expenses, like cremation costs, burial costs, or unpaid debts.

By securing final expense insurance direct, you usually won’t need to organize a physical exam, and acceptance is usually guaranteed for Canadian residents (excluding residents of Quebec) up to age 80. This insurance is also flexible, so your loved ones can use this coverage to pay for immediate expenses, outstanding bills, or even day-to-day expenses.

Get a free quote

Direct final expenses insurance can take the stress out of your life so that you can enjoy it to the fullest. FiftyUp Final Expenses Insurance can give you peace of mind, knowing final expenses don’t have to be a burden to your loved ones after you pass away. Learn more about FiftyUp’s direct coverage options, which are easy to understand and easy to secure.