Insurance is a fundamental part of modern life. It secures and protects individuals and businesses from financial loss due to unforeseen events. In Canadian insurance, the federal government regulates businesses and organizations, and each province has its own set of regulations. This includes insurance companies in Canada.
With so many different types of insurance available, it can be challenging to understand what you need and how to choose the right plan. This guide will provide a comprehensive overview of insurance in Canada, including the types of insurance available, how to choose the right plan and tips for finding affordable insurance. The following provides some helpful information about the things you need to know about Canadian insurance
Once you arrive and are going through the settlement process, getting insurance in Canada is one of the things you will need to consider and complete first. The decision to acquire insurance will largely depend on your circumstances, such as whether you have moved with your partner, started a family, rented or bought a home or apartment, started a business, or bought a new vehicle.
Like everywhere else, insurance will protect you from financial loss or hardship while you are in Canada. The insurance would help cover costs if something unexpected happened to your family, vehicle, home, or any of your prized assets. Insurance products cover different forms of insurance and risks, and as a foreign national, you will need to understand the different forms.
An insurance policy is a binding legal agreement between you (the insured) and the insurance firm:
- The risks which are covered by your insurance company
- Under what circumstances will the insurer make payment to you
- How much money, or what type of benefit, you’ll get if you make a claim
There are different types of Personal Insurance (PI) that you can apply for. They’re categorized based on what you want to insure yourself for while residing in Canada. These PI include:
- Disability Insurance
- Life Insurance
- Long Term Care Insurance
- Critical Illness Insurance
- Health Insurance
- Supplementary/Extended Health Insurance
Car/Auto Insurance in Canada
Auto insurance is mandatory in Canada. It covers the cost of damage to your vehicle and liability for any damage or injury you may cause to others. Different coverage levels are available, including liability-only, collision, and comprehensive coverage. Liability-only coverage is the minimum required by law.
It covers the cost of damage or injury you may cause to others but does not cover damage to your vehicle. Collision coverage covers the cost of damage to your vehicle in the event of an accident, regardless of who is at fault. Comprehensive coverage covers the cost of damage to your vehicle due to events such as theft, vandalism, or natural disasters.
Home Insurance in Canada
Home insurance is not mandatory in Canada, but it is highly recommended. It covers the cost of damage to your home and personal property due to fire, theft, or natural disasters. It also covers liability for any damage or injury you may cause to others while on your property.
Different levels of coverage are available, including basic, broad, and comprehensive. Basic coverage covers the cost of damage to your home and personal property due to specific events listed in the policy.
Broad coverage covers the cost of damage to your home and personal property due to a wider range of events. Comprehensive coverage covers the cost of damage to your home and personal property due to any event not specifically excluded in the policy.
Employment/ Unemployment Insurance in Canada
Employment insurance is designed to provide temporary financial assistance to individuals who have lost their job due to no fault of their own. To be eligible for employment insurance, you must have worked a certain number of hours in the past year and be actively seeking employment.
The Canadian government unemployment insurance. It provides financial assistance to individuals who are unemployed and actively seeking employment. To be eligible for unemployment insurance, you must have worked a certain number of hours in the past year and be actively seeking employment.
Health Insurance in Canada
Health insurance is provided by the government in Canada. All Canadian citizens and permanent residents are eligible for public health insurance, which covers the cost of medically necessary services such as doctor visits, hospital stays, and surgeries.
However, there may be gaps in coverage, such as prescription drugs, dental care, and vision care. Many employers also offer private health insurance plans as part of their employee benefits package. These plans can provide additional coverage for services not covered by public health insurance.
Travel Insurance in Canada
The majority of permanent Canadian residents’ medical expenses are covered in Canada through tax-funded government subsidies. As a citizen or permanent resident of Canada, should you choose to visit your family or explore another country, you will be limited in your medical claims. This is why you will need travel insurance.
Travel insurance in Canada pays for any unexpected and emergency costs while traveling. Travel insurance is very useful for visitors to Canada with temporary visas. Learn about travel insurance overage and who is eligible to apply here if you want to know more.
Life Insurance in Canada
Life insurance is designed to provide financial security for your loved ones in the event of your death. Two main types of life insurance are available in Canada: term life insurance and permanent life insurance. Term life insurance covers a set period, usually 10-30 years. Permanent life insurance provides coverage for your entire life.
There are also different options within each type of life insurance, including level term, decreasing term, and whole life insurance. Level-term insurance provides a set amount of coverage for the entire policy term.
Decreasing term insurance provides a decreasing amount of coverage over the policy term. Whole life insurance provides coverage for your entire life and includes a savings component.
Disability Insurance in Canada
People with disabilities are taken care of in Canada. Many programs cater to long-term savings plans. Disability insurance in Canada mainly caters to three broad categories which include: Assisted Living, Registered Disability Savings Plan (RDSP), and Grants for Students With Disabilities.
If you have been through a formal assessment conducted by a medical professional and need financial assistance due to being unable to perform your work duties, you may qualify for the Assisted Living Program.
The three major components of the Assisted Living program are; in-home care, adult foster care, and Institutional care. All of these components generally improve the quality of life at home and the community is bettered.
Registered Disability Savings Plan (RDSP)
This long-term savings plan assists Canadians with disabilities and their families to save. Subsidized by the Canada Disability Savings Grant and a Canada Disability Savings Bond, Canadian residents under the age of 60 are eligible to apply.
Grants for Students With Disabilities
Disabled students can apply to the Canada Student Grant for Students with Permanent Disabilities. Universities in the Northwest Territories, Nunavut, and Quebec cannot access this grant. Instead, these grant-exempt provinces operate their student financial assistance programs. A grant of CAD 2,000 is awarded to students who meet the eligibility criteria each year.
Disability Insurance (DI) Plan
A common work-related insurance plan is the Disability Insurance (DI) Plan. Long-term disability insurance benefits under the Disability Insurance (DI) Plan are provided to public service employees who are deemed eligible to apply. Eligible members of specified designated groups who become disabled and are unable to work can also apply for the Disability Insurance Plan.
The Disability Insurance Plan also covers collective bargaining employees who are employed by the Treasury Board or a designated agency or corporation. For more information on other insurance benefits and/or compensation programs available to you in case you’re absent from work for health reasons, refer to the Workplace Health and Disability directory page.
What is an Insurance Waiting Period in Canada?
Permanent residents who applied for health insurance can expect to wait three months before they receive their health insurance card. We recommend you take out a temporary private health policy coverage, particularly if your family consists of children or elderly people who need health assistance during the waiting period.
Tips for Choosing the Correct Insurance Plan for Yourself
Choosing the Right Insurance Plan Can be Challenging
There are many factors to consider, including your budget, the level of coverage you need, and the deductible you can afford. Here are some tips for choosing the right insurance plan for you:
Determine the Level of Coverage you Need
Consider the potential risks you face and the cost of replacing or repairing your assets.
Look at the coverage and cost of different policies from multiple insurance providers.
Consider the Deductible
A higher deductible will lower your premium, but you will pay more out of pocket in the event of a claim.
Look for Discounts
Many insurance providers offer discounts for things like bundling policies, having a good driving record, or being a member of certain organizations. Read the fine print: Make sure you understand the terms and conditions of the policy before you sign up.
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Best Insurance Companies in Canada
Different Canadian insurance publications will have different lists of what they consider the best insurance companies ensuring that there is no definitive list. However, the most commonly cited best insurance companies include:
Manulife Financial Corporation gives financial advice, wealth, and insurance asset management solutions for groups, insurance, and institutions through offices in Canada, Asia, and Europe.
Great West Lifeco is a subsidiary of the giant investment company Power Financial Corporation. Great-West Lifeco Inc offers a range of health and life insurance products, retirement and investment services, reinsurance solutions, and wealth management.
Desjardins Group is a financial service cooperative and the largest credit union federation in North America.
Sun Life Financial is one of the largest (third) life insurers in Canada. It offers various insurance and asset management services in Canada and strategic countries worldwide.
Fairfax Financial Holdings Limited is a holding company that operates via several subsidiary companies, which include Allied World, Brit Group, Zenith National, Northbridge Financial, and Odyssey Group. A wide range of P&C insurance, investment services, and reinsurance is offered.
iA Financial Corporation Inc, the holding company of iA Financial Group, is among the largest insurance and wealth management providers in the country. The firm offers life, auto, home, travel, critical illness, accidental death, disability, and group insurance.
Intact serves approximately six million personal, business, institutional, and public sector clients in key strategic regions such as Europe, the UK, Australia, and USA.
La Capitale (Beneva)
La Capitale Financial Group Inc. offers insurance products and financial services primarily in Québec. La Capitale General Insurance, its subsidiary, is ranked among the largest insurers in Quebec. It has 900 offices and 600,000 staff members globally.
Empire Life offers critical illness insurance, life insurance, and group benefits. E-L Financial Corporation Limited trades on the Toronto Stock Exchange. It operates and manages more than $19.6 billion in assets for over 600,000 customers.
Co-operators Group Limited is among Canada’s largest multi-line insurance companies. It provides cooperative insurance for home, auto, health, life, group, travel, farm, and business policies.
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Who Regulates Insurance Companies in Canada?
Property and casualty (P&C) insurance companies are regulated by federal and/or provincial regulators called Superintendents of Insurance. The Office of the Superintendent of Financial Institutions (OSFI) regulates the financial soundness and solvency of P&C insurance companies at the federal administrative level.
At the provincial government level, individual Superintendents of Insurance regulate insurance products, license insurance companies and market conduct (rating, underwriting, claims, and marketing practices), and regulate the solvency and financial soundness of the insurance companies incorporated and headquartered in their province.
What is the Largest Insurance Company by Market Valuation in Canada?
Manulife is the largest insurance company in Canada in terms of total assets and ranks among the world’s top 10. Its workforce exceeds 40,000 worldwide.