A guide to health insurance plans in Canada
Looking for private health insurance in Canada? Learn more about how health insurance works with our comprehensive guide below.
A snapshot of the Canadian health insurance market
Before we dive into all things health insurance in Canada, it’s important to understand the industry’s scale and impact. Health insurance plays a vital role in bridging the gaps left by the public healthcare system, ensuring Canadians' access to a wide range of medical services. Here are some key market statistics from the Canadian Life & Health Insurance Association (CLHIA):
- 70%
of Canadians are protected
Nearly 70% of Canadians were insured against health care costs in 2023.
- $60.8B
premiums paid for health coverage
$60.8 billion worth of health insurance premiums were paid in 2023.
- 85%
of premiums paid as benefits
On average, 85% of premiums paid to insurers are paid out as benefits.
- $48.2B
health benefits paid out
In 2023, a total of $48.2 billion were paid out in health benefits.
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What is health insurance in Canada? How does it work?
Matt Hands, VP, Insurance
Health insurance is there to protect you financially against the cost of medical and health-related expenses. In Canada, two types of health insurance that work in combination to cover all types of needs: public health insurance and private health insurance.
Canada's public healthcare system, known as Medicare, provides universal healthcare to all Canadian citizens and permanent residents. This is funded through taxes and managed separately by each province and territory. This is the reason why in most cases, there is no bill after visiting the doctor's office or the emergency room. The universal healthcare system covers a wide range of medical services, including:
- Doctor's visits – This includes check-ups and consultations from family physicians or walk-ins.
- Hospital services – This includes emergency care, hospital stays, and surgical procedures.
- Specialist care – Specialist referrals (e.g. oncologists, cardiologists) are covered, on top of GPs.
- Diagnostic procedures – This includes lab tests, X-rays, MRIs, CTs, biopsy procedures, and more.
But even with the universal healthcare system in place, there are still many gaps when it comes to the government's coverage – including prescription drugs, dental care, vision care, and a variety of paramedical services (physiotherapists, chiropractors, nutritionists, and psychotherapists to name a few). This is where supplementary health insurance (or private health insurance) comes in.
With public health claims, such as a hospital stay in a standard ward, there is no need to file a claim on your own. Instead, the healthcare services will be billed directly to the government. On the other hand, private health claims are handled in one of two ways – you either pay out-of-pocket first and receive reimbursement from your insurer afterward, or the insurer pays the service provider directly.
What about group insurance?
Many Canadians already receive private health insurance through their employer's benefits package, also known as group insurance. This benefits package could include life insurance, dental insurance coverage in addition to health insurance. This type of coverage is highly accessible because premiums are shared among all members of the group, reducing overall costs – employers typically cover a portion (or sometimes all) of the premiums. Additionally, no medical exams are required, which can make it ideal for individuals with pre-existing conditions (e.g. diabetes, mental health disorders) who might otherwise face a hard time getting approved for individual plans.
Know that if you part ways with your job, you may lose your group coverage. In such cases, you can explore converting to or purchasing an individual plan to maintain your benefits. You may also want to supplement your employer's health insurance anyway with an individual plan as group plans often come with coverage limitations.
Who does health insurance cover in Canada?
A private health insurance policy covers the plan member and usually comes with the option to extend coverage to any qualified dependents. This can include your spouse, partner, or children under 19 years old (if your child is older, your health insurance may still cover them if they are a full-time student or disabled). Know that every policy is different, so be sure to check all the terms carefully when researching your options.
How does health insurance work for newcomers to Canada?
Whether you have access to Canada's universal healthcare as a newcomer depends on two main factors: your immigration status and your province or territory of residence.
Visitors: If you're just visiting Canada, you won't have access to public healthcare coverage. It’s highly recommended to purchase a private insurance plan (which can be through travel insurance) to cover any medical expenses during your stay.
Permanent residents: As a permanent resident, you are eligible for public healthcare coverage. You can apply online through your province or territory's Ministry of Health. Once approved, you’ll receive a health card, which you must present each time you access medical care.
However, there may be a waiting period before coverage begins. In Ontario, new immigrants need to wait three months before their coverage kicks in, while in Nova Scotia, access is immediate. It’s highly advisable to purchase private health insurance during any waiting period to avoid gaps in coverage.
Specific newcomer categories: Certain categories of newcomers, such as Super Visa holders and International Experience Canada (IEC) workers, are required to have private health insurance.
- Super Visa holders: Must have coverage for at least one year from their entry date.
- IEC workers: Need coverage for the entire duration of their work permit.
For international students, many provinces and territories provide access to public healthcare, provided you meet the eligibility requirements. The exceptions are Ontario, Quebec, Prince Edward Island, and Yukon. Here, you may be required to purchase or opt into private coverage, which is generally available through your school (and may be covered by your tuition fees).
Temporary foreign workers do have access to public coverage, but similar to permanent residents, there may be a waiting period depending on where you're located. If there is a waiting period, it's required that your employer pay for private medical insurance during this time, with a few exceptions.
Common health insurance terms you need to know
Every health insurance policy has different terms, so it’s important to thoroughly understand your plan literature to ensure it meets your needs. When researching your options, here are three common health insurance terms you should know:
| Term | Description |
| Deductible | This is the amount you'll need to pay out before your insurer covers the rest of your claim. For instance, if you need $1,200 worth of prescription medication, and your deductible is $500, you'll need to pay that out before your insurer covers the remaining $700. |
|---|---|
| Coinsurance | More commonly, plans come with coinsurance pay which means that you'll need to pay out a percentage of the expense while your insurer covers the rest. For instance, it may be a 20-80 split between you (20%) and your insurer (80%). Breakdowns can also differ from expense to expense. |
| Maximum | Your policy will outline different maximums for all the coverages which is the limit your plan will pay out up to. For instance, you may have a $5,000 maximum on drugs and a $500 maximum on vision care. Once your plan is exhausted, even if you have more claims to make, you'll be on your own. |
Common coverages on health insurance plans
As mentioned, private health insurance in Canada covers medical expenses that go beyond what the government already provides. Here are some common coverage areas a comprehensive policy can help pay for – but know that every policy is different, so be sure to check your terms carefully:
Prescription drugs
Government drug coverage varies from province to province and is often quite limited. Health insurance can help fill the gaps for basic needs (e.g. antibiotics, contraception) and more specialized treatments.
Special medical services
This includes services, outside of government coverage – dieticians, physiotherapists, chiropractors, optometrists, psychotherapists, and more.
Out-of-country expenses
Government healthcare does not cover most medical costs incurred outside Canada. Private insurance can cover emergency medical care while abroad, including hospitalization and medical services.
Ambulance services
Health insurance can help bridge the gaps of any ambulance or transportation fees that aren't covered by your provincial plan.
Special nursing services
For individuals needing at-home care or specialized nursing after surgery or a severe illness, health insurance can help cover these costs.
Vision care
Government health plans often don’t include routine eye exams, prescription glasses, or contact lenses – private insurance can help pay for these services.
Private hospital accomodation
While the government covers basic hospital accommodation (e.g. shared ward rooms), individual health insurance can help pay for semi-private or private stays.
Medical appliances
This can include coverage for mobility aids (e.g. wheelchair, crutches), respiratory devices (e.g. CPAP machine), diabetic supples (e.g. insulin pumps, glucose monitors), and much more.
Artificial limbs & prosthesis
For those who have undergo amputation, private health insurance can help pay for necessary artificial limbs, prosthesis, and related equipment that would otherwise be unaffordable.
Does health insurance cover dental work?
While dental insurance may be included on some health plans, it's often sold as an add-on or an entirely separate policy. Common coverages for dental work include basic preventative and maintenance services (e.g. check-ups, cleanings, fillings, extractions, X-rays), as well as more complex procedures like root canals and periodental cleanings and scalings. Some policies may also help pay for major dental work like bridegwork and dentures, inlays and crowns, and orthodontic procedures (e.g. braces).
Other types of health insurance in Canada
Aside from the standard health and dental insurance plans in Canada, you can also consider other specialized forms of health coverage, depending on your medical needs. Here, we cover a few popular options:
Hospital cash plans
Health insurance for visitors to Canada
Disability insurance
Critical illness insurance
Long-term care insurance
Travel health insurance
How much does health insurance cost in Canada?
One of the most significant factors influencing your health insurance premium is the level of coverage your plan provides. Below, we present three sample quotes for different levels of coverage – all based on the same profile: a healthy 36-year-old female. Keep in mind that you won’t know the exact cost of your health insurance plan until you shop the market. Make sure to thoroughly research all your options to find the best fit for your needs.
| Coverage | Basic plan | Standard plan | Premium plan |
| Prescription drugs | 70%, up to $500 | 70%, up to $600 | 70%, up to $700 |
|---|---|---|---|
| Dental work | $500 per year | $750 in year 1, $900 per year after | $800 in year 1, $1,200 per year after |
| Vision exams + eyewear | $60 + $200 per 2 years | $60 + $250 per 2 years | $100 + $400 per 2 years |
| Paramedical services | 50%, up to $600 | 80%, up to $750 | 80%, up to $1,000 |
| Mental health services | $500 per year | $800 per year | $1,300 per year |
| Health insurance quote | $110.28/month | $133.33/month | $174.19/month |
Factors that impact your health insurance quote
Again, there is no one cost for health insurance as policies are calculated on an individualized basis. The more risk you bring, the more you'll be paying for your coverage. And as mentioned, opting for extended coverage will inevitably lead to higher rates.
Age
The older you are, the more expensive private health insurance will cost you. This is due to the added health risks that come with aging.
Health status
Insurers may ask questions about pre-existing conditions (which can hike up your rate). You could even be denied coverage due to medical history.
Lifestyle
Smoking increases health insurance premiums. Plus, some high-risk acitvities or jobs (e.g. working with chemicals) can increase your costs.
Family size
More specifically, adding more family members to your policy (e.g. spouse, children) will increase your costs due to the added protection.
Location
Medical expenses differ from province to province. Living in an area where care costs more can increase your health insurance rate.
Coverage types
The more coverage you have, the more expensive insurance will be – a comprehensive plan will health and dental coverage will be more than health alone.
Coverage limits
Higher coverage limits will hike up the cost of your health insurance. But choosing increased maximums can also pay off in the long run.
Deductibles and co-pays
An increased deductible or higher co-pay percentage will undoubtedly help lower your premium costs. But be aware of the out-of-pocket consequences.
Does health insurance cover pre-existing conditions?
In many cases, a pre-existing condition can void your approval for health insurance or void your ability to be insured for expenses related to the condition. Be sure to read your policy terms carefully to understand what you are and aren't covered against.
Know that there are still many options for those with pre-existing conditions to get health insurance. Group policies typically cover you for pre-existing conditions, and enrolment is approved when you become a group member (such as once you become employed with your company).
Guaranteed-issue policies are another option for those with pre-existing conditions. With these, you're guaranteed to be approved no matter your health status. Just be aware that coverage may be limited, and premiums tend to be quite high.