Canada’s public healthcare doesn’t cover everything. These 6 types—long-term care, disability, critical illness, private plans, travel insurance, and group coverage—fill the gaps and protect you from big out-of-pocket costs.
When it comes to your health, safeguarding it isn't just sensible—it's essential. While our government-funded healthcare in Canada provides an excellent foundation, unexpected medical situations—like accidents or illnesses—can leave gaps in coverage. That’s why a supplemental health care policy exists: to protect you financially and support your wellbeing beyond what the public system offers.
There are multiple types of health insurance policies tailored to different needs. Healthcare isn’t one-size-fits-all, and knowing what’s out there helps you choose the right plan for yourself and your family. Below, we dive into six key kinds of health insurance that every Canadian should understand.
Not all illnesses strike swiftly—many evolve gradually, requiring extensive support over months or years. Long-term care (LTC) insurance helps with the costs of services not covered by provincial health plans or private insurance—like home care, assisted living, or nursing homes.
In Canada (and internationally), LTC covers help when you can’t perform essential daily activities—such as eating, bathing, dressing, or transferring. Many Canadians won't need it until later in life, but statistics show a majority of seniors will require it at some point—making it a critical component of retirement planning.
These policies typically let you select:
Benefit trigger (e.g., inability to perform 2+ daily activities),
Benefit duration and maximum payout (daily or monthly limits), and
Elimination period, a waiting time before benefits begin (often 30–120 days).
Why it matters: Without LTC insurance, long-term care costs can quickly deplete savings—especially when provincial coverage is limited. LTC gives you more choice in your care and helps preserve financial independence.
2. Disability Insurance
What happens if an illness or injury prevents you from working—even temporarily? Disability insurance is designed to replace part of your income when your ability to earn is impaired.
There are two primary forms:
Short-Term Disability (STD)
Covers temporary disabilities lasting a few weeks to about six months.
Often provided through employer group plans or, if unavailable, via government Employment Insurance (EI).
Eligibility may require using up sick leave or accumulating sufficient work hours.
Long-Term Disability (LTD)
Kicks in once short-term benefits end.
Typically covers 60–70% of income.
Especially valuable for high-risk professions or chronic health conditions.
Why it matters: Disability insurance protects against income loss—your most valuable asset—helping cover living expenses like mortgage, food, and bills during recovery.
3. Critical Illness Insurance
Surviving a stroke, heart attack, cancer, or other serious illness is a huge relief—but the financial toll can be heavy. Critical illness insurance provides a lump-sum payout upon diagnosis of a covered condition, which you can use however you wish: medical expenses not covered by provincial plans, modifications to your home, family care, or even mortgage payments.
This cash benefit helps ease financial stress during recovery, offering flexibility beyond traditional medical claim structures.
4. Individual / Extended Private Insurance
Not all procedures or treatments fall under public coverage. Individual or extended private insurance fills these gaps—covering services like prescription drugs, dental, vision, chiropractic, physiotherapy, ambulances, medical devices, and mental-health care.
Important terms to understand:
Plan maximums: Dollar limits per treatment category per year.
Co-pays / Co-insurance: Shared cost structure (e.g., 20% of a therapy bill).
Deductibles: The amount you pay before insurance kicks in.
Exclusions: Not all services are covered—e.g. lifestyle therapies may be excluded.
Why it matters: These plans let you customize your healthcare—whether you need extra dental work, glasses, mental-health support, or coverage while travelling.
5. Travel Medical & Visitor’s Insurance
Whether you’re visiting Canada or traveling abroad, travel medical insurance helps protect against out-of-pocket costs for medical emergencies.
Coverage includes hospital stays, emergency care, medical evacuation, repatriation, and quickly changing COVID-19 policies.
In Canada, international visitors often must arrange private medical insurance, while Canadians abroad may rely on travel-medical coverage included in individual or employer plans.
Why it matters: Healthcare abroad can be shockingly expensive. Travel medical insurance guarantees you're not left with crippling bills due to illness or injury abroad—plus many insurers offer 24/7 emergency assistance .
6. Group Plans (Employer or Association-sponsored)
Group insurance is often the easiest and most cost-effective way to get supplemental coverage. Offered through employers, alumni groups, unions, or associations, it provides bulk-rate premiums, less stringent underwriting, and often covers prescription drugs, dental, vision, paramedical services, hospital upgrades, and travel insurance .
Cons: Typically ends when you leave the group or employer; limited customization.
Why it matters: If available, group plans are highly valuable—broad coverage at a low cost. If you lose them, look into individual or association-based plans that may allow guaranteed issue renewal .
Plan Comparison: Private & Group Options
Plan Type
What It Covers
Ideal For
Typical Cost Impact
Group Plan
Drug, dental, vision, paramedical, travel
Employees / association members
Low premium, broad coverage
Individual Extended Plan
Same as group, but customized and privately purchased
Self-employed, no group access
Moderate premium, variable coverage
Critical Illness Insurance
Lump sum on serious diagnosis
Families needing income loss protection
Moderate cost, large payout
Disability Insurance (STD/LTD)
Income replacement during sick leave
Workers in high-risk jobs
% of income premium, critical coverage
Long‑Term Care Insurance
Home care, nursing, assisted living
Seniors or those with hereditary risk
Often expensive; consider early
Catastrophic / Stop‑Loss Plan
High deductible emergency coverage
Young, healthy, self-insured individuals
Low premium, high deductible
Prescription Drug Coverage: A Crucial Add‑On
Prescription coverage is one of the biggest gaps in Canadian healthcare. The average person spends over $1,000 a year on meds—rising significantly for chronic conditions .
Provincial plans vary in drug coverage, but for many, most medications remain out-of-pocket unless supplemented privately. Without coverage, families can face thousands of dollars in yearly drug bills. Even cancer survivors and diabetics rely heavily on prescription benefits.
An extended plan with medication coverage dramatically reduces that burden and provides peace of mind.
Choosing a Health Insurance Plan: Step by Step
Assess your needs & life stage.
Are you young and healthy? A high-deductible catastrophic plan might suit your budget.
Do you have chronic conditions or prescription needs? Prioritize drug and paramedical coverage.
Understand key terms.
Deductibles, co-pays, co-insurance, plan maximums, exclusions—all determine your out-of-pocket costs.
Decide between group vs. individual.
Group plans offer better value but aren’t portable. Individual plans offer flexibility but have stricter underwriting and higher premiums.
Higher-tier plans cost more but include extras. Evaluate what you get vs. what you need.
Ask about guaranteed issue and pre-existing conditions.
If switching or losing group coverage, apply within 60–90 days to avoid exclusions.
Ensure your medication or condition won't be excluded after enrolment.
Review limits and exclusions.
Know annual maximums for paramedical, vision, dental, and drug benefits. Also check lifetime and per-incident caps.
Balance cost vs. value.
Analysis of Reddit users indicates:
"Most years the average person with an individual health insurance plan is going to pay more for the insurance than they will get back in benefits. The real value of the insurance only kicks in when you have exceptionally high expenses for something like cancer drugs."
If you already have resources or provincial support, a catastrophic “stop-loss” plan may be sufficient.
Applying the Advice: Scenarios
Young, healthy individual (under 30):
Consider a catastrophic plan with a low premium and high deductible for emergencies.
Self-fund routine expenses (e.g., $120 for every $100 benefit) and build an emergency savings.
Family with children:
Prioritize drug, dental, and paramedical coverage in a group or individual plan.
Consider adding critical illness insurance if family history suggests risk.
Pre‑existing conditions or prescription needs:
Apply within 60–90 days of losing group benefits to avoid exclusions.
Expect higher premiums; shop around and consider specialist insurers.
Impending retirement:
Think about LTC insurance now—premiums are lower and underwriting easier.
Assess travel coverage if you split retirement time between countries.
How to Save Without Sacrificing Coverage
Adjust deductible levels wisely. Higher deductibles = lower premiums. Ensure you can cover the deductible comfortably .
Bundle services. Many insurers allow custom plans—combine vision, travel, dental, paramedical—to get bundled discounts.
Switch providers when beneficial. Brokers or comparison sites can identify savings; switching every few years may yield better pricing .
FAQs About Canadian Health Insurance Plans
Understanding the ins and outs of Canadian health insurance can be tricky. These are some of the most commonly searched questions to help you make informed decisions.
The most common health insurance plans include group/employer-sponsored plans, individual extended health insurance, disability insurance, critical illness insurance, long-term care insurance, and travel medical insurance. Each serves different purposes and may be combined for broader coverage.
Yes, especially if you need coverage for services not included in your provincial plan, such as prescription drugs, dental care, vision, mental health services, and out-of-country medical emergencies. Private health insurance helps fill these gaps and can significantly reduce out-of-pocket costs.
Disability insurance provides monthly income if you’re unable to work due to illness or injury, while critical illness insurance gives a one-time lump-sum payment upon diagnosis of a covered serious condition. Both offer financial protection, but serve different needs.
Yes, government healthcare doesn’t cover many essential services like dental, vision, prescription medication, or private hospital rooms. Supplemental health insurance ensures you’re fully protected and avoids financial strain during medical events.
Absolutely. Individual health insurance plans are available through private insurers and can be customized based on your health needs and budget. These are ideal for self-employed individuals, retirees, students, or anyone not covered by an employer.
Final Thoughts
Canada’s public healthcare system is robust—but gaps remain in prescription drugs, dental, vision, paramedical services, income protection, and long-term care. The types of supplemental health insurance described here are essential tools for filling those gaps—each tailored to different life stages, risk factors, and financial strategies.
Whether you’re young and healthy taking out a high-deductible plan, a working adult relying on group coverage, or a senior planning for long-term care, understanding these six types gives you control over your health and financial future.
Interested in learning more about health insurance in Canada? Why not try a service that accurately, to bring you a policy at the lowest possible rate? Discover the right health plan for your unique needs, today, with Insurdinary, and start taking better care of yourself.
Important Notice:
All interest rates, fees, and other numerical figures displayed on our website are subject to change without prior notice. To ensure you have the most current information and/or promotion, please visit the provider's official website.
