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GROUP BENEFITS

 

 

Employee Group benefits may include:

Life insurance

Extended health benefits

Prescription drugs

Travel insurance

Dental care

Disability insurance

Critical illness

 

  LIFE INSURANCE

You can select from  two coverage options:

Flat Amount: may be from $10,000 to $1,000,000

Salary Based:  1, 2 or 3 times earnings, with a maximum amount up to $1,000,000. The salary-based schedule has the added advantage of keeping the benefit amount in step with inflation and with the employee's changing financial circumstances.

 

Waiver of Premium: The premium for this benefit may be be waived if an employee becomes totally disabled while insured.

Conversion Privilege:  An employee has the right to convert the Employee Life Insurance to an individual policy without medical evidence if group coverage terminates. Application for conversion must be made within 31 days of the termination date.

The Dependent Life benefit provides life insurance coverage for an employee's dependents. For example, coverage for spouse is up to $25,000 and for dependent child is up to $12,500.

 

Taxation: Premiums for life and AD&D insurance are a taxable benefit for the employee.  Benefit is non-taxable when received.

 

 

  EXTENDED HEALTH CARE BENEFIT

The Extended Health Care benefit provides employees and their eligible dependents with coverage for various medical expenses that are not covered by the Provincial Plans.
This benefit may include:

  • Drug Benefit

  • Hospital services (semi-private room, private room, chronic care facility)

  • Vision care may cover various combinations of the following options:

    • eye examinations (one per calendar year);

    • glasses or elective contact lenses, to the maximum chosen for the plan;

    • medically necessary contact lenses, subject to a benefit maximum

     
  • Professional/paramedical services

    • chiropractors;

    • osteopaths;

    • podiatrists;

    • massage therapists;

    • naturopaths;

    • speech therapists;

    • physiotherapists;

    • psychologists; and

    • other practitioners

  • Medical services, supplies and equipment;

    Medical services:

    Medical supplies:

    • equipment rental;

    • non-dental prostheses, supports and hearing aids.

    Other supplies:

    • artificial eyes, limbs and breast prostheses;

    • braces, trusses, collars, leg orthoses, casts, splints;

    • stock-item orthopedic shoes, including modifications or adjustments to stock-item orthopedic shoes or regular footwear;

    • charges for casted custom-made orthotics;

    • custom-made shoes required because of a medical abnormality;

    • surgical stockings;

    • surgical brassieres;

    • wigs and hairpieces.

  • Survivor Dependent Benefit:  This benefit provides for the continuation of Extended Health Care coverage for dependents, up to a maximum of 24 months, if an employee dies while insured.

See an example of Health & Drug Plans for your business.

 

Taxation (except in Quebec) : Employer-paid premiums for Extended health benefits  are not a taxable benefit for the employee. The employee contributions are eligible for the medical expense tax credit.

Benefits are  not taxable when received by the plan member .

 

 

  DRUG BENEFIT

This benefit will reimburse a group member and his/her family for the purchase cost of prescription drugs. Maximum annual reimbursement may be from $1,000 to unlimited.

 

Drug Plan Basis Types:

●  Brand

What are brand name drugs?

Companies that develop brand name drugs hold a patent on the formula. A patent gives the drug maker the sole right to produce and sell the drug. 

Patents do not last forever and in Canada, the patent lasts for 20 years. When they end, other companies can make a drug that is like the brand name drug in every important way. These drugs are called generic drugs. They also cost less. But they have the same key ingredient(s). Both generic and brand name drugs follow the same quality and safety standards.

 

●  Voluntary Generic

Generic drug substitution is a widespread cost-saving measure on drug plans. It means that, when a doctor prescribes a drug, the pharmacist dispenses the lowest-priced equivalent (usually the generic) version of that drug, if one is available. Generic drugs use the same active ingredients as brand-name products, but usually cost significantly less. However, if a physician writes "no substitution" on a prescription, the higher-cost brand drug may still be dispensed.

 

●  Mandatory Generic

Mandatory generic substitution works by targeting “multi-source” drugs, which are drugs that are available as both a generic and a brand. When a plan member is prescribed a multi-source drug, the  plan member is reimbursed based on the lowest cost alternative, typically the cost of the generic drug. This holds true even when a physician has indicated “no substitution” on the plan member’s prescription.

When the drug prescribed is not a multi-source drug, meaning it does not have a generic, interchangeable option, the reimbursement is based on the cost of the brand drug.

 

●  Provincial Formulary

Covers prescription drugs listed in the Provincial Formulary.

 

 

   DENTAL CARE

This benefit provides employees and their eligible dependants with coverage for expenses incurred for dental treatment.

 

The Plan may include:

Basic and Supplementary Services (preventive care, basic care, restorative services) : oral exams, scaling and polishing, fillings, pit and fissure sealants, diagnostic and laboratory procedures, minor surgical procedures, extractions, space maintainers,   denture repairs, relines and rebases periodontal services (treatment of gum disease), including deep scaling, endodontic services (root canals), surgical procedures - other than extractions.

 

Major Services: initial placement of dentures ,replacement of dentures, crowns and onlays, inlays, replacement of crowns, bridges (including replacements) . The group must have at least 3 participants for Dental coverage to be eligible for Major Services.

 

Orthodontic Services  for dependent children prior to reaching age 19. The group must have at least 5 members with family coverage to be eligible for Orthodontic Services

 

Survivor Dependent Benefit:  This benefit provides for the continuation of Dental Care coverage for dependents, up to a maximum of 24 months, if an employee dies while insured.

 

 See an example of  group dental options  for your business.

 

Taxation (except in Quebec) : Premiums for Dental Care benefit paid by the employer are not a taxable benefit for the employee. The employee contributions are eligible for the medical expense tax credit.

Benefits are  not taxable when received by the plan member.

 

 

   TRAVEL INSURANCE 

Coverage for treatment required as a result of a medical emergency which occurs during the first 60* days outside the province of residence (provided provincial plan coverage is in place).  

* Number of days may be different with different insurance providers.

 

 

  DISABILITY INCOME INSURANCE

The Short Term Disability benefit

Provides an employee with partial replacement of lost income for short periods of total disability. Benefits commence following the completion of the elimination period and are payable up to the maximum benefit period.

Elimination (waiting) period may be :

- 0 days for accident, 3 days for sickness

- 0 days for accident, 7 days for sickness

- 14 days for accident, 14 days for sickness

Benefit period may be 15 weeks, 17 weeks and 26 weeks.

Benefit Amount: 55%, 60%, 66.7%, 70% or 75% of weekly earnings.

 

The Long Term Disability benefit

Provides an employee with partial replacement of lost income if the employee becomes totally disabled while insured for this benefit.

Elimination (waiting) period: 15 weeks, 17 weeks or 26 weeks

Benefit period: 2 years, 5 years, to age 65.

Benefit Amount: 60%, 66.7%, 70% or 75% of monthly earnings.

Maximum benefit: up to $10,000 (monthly)

 

Partial disability:  50% of the total disability benefit under the contract for up to 24 months of partial disability

 

Taxation: Employer-paid premiums are not a taxable benefit to the employee.

Benefit: If the employer makes any contribution to the disability insurance premiums, the employee will pay income tax on the disability benefit received. If the employee pays a 100% premium for disability insurance, benefit is not taxable when received.

 

 

   CRITICAL ILLNESS INSURANCE

Critical Illnesses, which may be covered by this benefit: Cancer (Life-Threatening), Coronary Artery Bypass Surgery, Heart Attack (Myocardial Infarction), Stroke (Cerebrovascular Accident),  Alzheimer’s Disease, Aortic Surgery,  Benign Brain Tumour,  Blindness,  Coma, Deafness, Heart Valve Replacement, Kidney Failure (End Stage Renal Disease), Loss Of Limbs, Loss Of Speech, Major Organ or Bone Marrow Failure and On Waiting List, Major Organ or Bone Marrow Transplant, Motor Neuron Disease, Multiple Sclerosis, Occupational HIV Infection, Paralysis, Parkinson’s Disease , Severe Burns.

The amount of coverage available depends on the size of the group: minimum of $10,000 and up to $50,000.

 

Taxation: Employer-paid   premiums for Critical Illness  insurance are a taxable benefit for the employee. Benefit is non-taxable when received.

 

 

NOTE: The information above provides a brief description of benefits and some of the taxation rules for group insurance plans.  For detailed tax information, please consult with your business accountant.

 

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Investments:    RESP     RRSP     TFSA       Segregated Funds

Revised: February 03, 2017