Did you know: Group benefits may change after you turn 65
Turning 65 is a milestone that often comes with changes, not just in life but also in your group benefits. Whether you’re planning to continue working or preparing for retirement, let us help you understand all your options!
Samantha Kohn, Freelance Blogger
Turning 65 is a big milestone, often marked by celebrations and a few extra grey hairs.
But while you’re blowing out those birthday candles, there’s something else that might change – your group benefits.
Many Canadians are choosing to stay in the workforce longer. In fact, in 2022, nearly one million Canadians aged 65 or older were working, representing 5% of the total workforce at the time. Now, there’s nothing wrong with working into your senior years, but it’s important to be proactive, because your group benefits may reduce or even disappear once you hit 65.
Let’s explore what this could mean for you and the steps you can take to protect yourself.
Key takeaways for group benefits
- Group benefits may change: Your employer may reduce or end group benefits after you turn 65, so it’s important to check your company policy about your coverage.
- Supplement your coverage: Consider private health, life, disability, and critical illness insurance to cover any gaps if your group benefits are reduced or terminated.
- Explore senior insurance options: If your benefits end, look into coverage options tailored for seniors to ensure financial and health security.
Can I lose group benefits after turning 65?
Yes, unfortunately, it’s possible.
As you age, your group benefits can undergo significant changes, depending on your employer’s policies. According to a recent CBC article, many companies either reduce or eliminate benefits like disability insurance after employees reach 65.
This shift is based on outdated assumptions that everyone retires at this age. However, as more seniors choose to continue working, this type of policy becomes more and more of a problem.
The thought of losing benefits you’ve relied on for years can be unsettling, but it’s essential to understand that this isn’t a blanket rule for all employers.
Some companies offer flexible plans that continue to provide coverage, but it’s very important to check with your HR department to know exactly where you stand.
Should I supplement my group benefits as a senior employee?
If you find that your benefits will be cut or reduced once you turn 65, you should seriously consider supplementing your coverage. Even if your group benefits remain intact, they may not cover everything you need as you get older.
For instance, some health expenses that become more common with age – like certain medications or long-term care – might not be fully covered. Adding supplemental insurance can help you avoid hefty out-of-pocket expenses and give you peace of mind.
But this likely leaves you wondering: which areas should you supplement? This depends on your health, lifestyle, and financial needs.
If you’re generally healthy, a basic supplemental health insurance plan might do the trick. However, if you have ongoing medical conditions, you might need more comprehensive coverage.
Additionally, considering supplemental life insurance is always a wise move. Look into getting life insurance for seniors in Canada, as it can provide financial security for your loved ones, covering final expenses and other costs.
Insurance options for workers after 65 without group benefits
If your group benefits are cut entirely, don’t panic. There are still plenty of insurance options available to you.
Health insurance: Health insurance for seniors is crucial if you lose your group health coverage. Private health insurance plans can help cover costs that provincial health care doesn’t, like prescription drugs, dental care, and vision care.
These plans can be tailored to fit your needs and budget, ensuring you get the care you need without breaking the bank.
Life insurance: Seniors’ life insurance options are plentiful and can be tailored to your specific needs. Whether you’re looking for term life insurance for a specific period or permanent life insurance (such as whole life insurance) that lasts your entire lifetime, there’s likely a plan that suits you.
Some policies are designed to cover final expenses, which can be a great relief for your family during a difficult time.
Disability insurance: Finding disability insurance as a senior can be challenging, as many policies end at 65. However, some insurers offer extended coverage that continues beyond this age.
If you’re still working and concerned about potential income loss due to disability, it’s worth exploring these options.
Critical illness insurance: This type of insurance provides a lump-sum payment if you’re diagnosed with a serious illness like cancer or heart disease.
Given the increased health risks as we age, critical illness insurance can be a financial lifesaver for seniors, helping you cover treatment costs, replace lost income, or fund your recovery.
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What happens to group benefits after retirement?
Retirement often brings changes to your group benefits package. While some employers offer retirement benefits, these are typically reduced compared to what you had while working.
Coverage for dependents might end, or the range of services covered might be more limited.
If your group health insurance ends at retirement, you’ll need to consider private health insurance to cover any gaps.
It’s also worth maintaining a life insurance policy, especially if you have dependents or significant financial obligations. Seniors’ life insurance policies are designed to be more affordable and accessible, even if you’re no longer part of a group plan.
In cases where your benefits are significantly reduced, it’s wise to explore all your insurance options – whether it’s health, life, disability, or critical illness insurance. Building a comprehensive safety net will help you navigate retirement with confidence.
The bottom line
Turning 65 shouldn’t mean having to worry about losing your group benefits, but it’s a reality many Canadians face. With more seniors staying in the workforce, it’s more important than ever to understand how your benefits might change and what you can do about it.
Whether it’s supplementing your existing benefits or exploring new insurance options, taking proactive steps now can help protect your health, finances, and peace of mind as you enjoy your golden years.
So go ahead, blow out all 65 of those birthday candles – just make sure you’re prepared if your group benefits coverage disappears with the smoke.