For small businesses in Canada, offering group benefits used to feel out of reach. Many owners believed it was something only large companies could afford. But that’s no longer the case.
Today, more small and mid-sized businesses are turning to group insurance as a way to attract and retain employees. It’s not just about perks. It’s about meeting expectations in a competitive hiring market.
Most often group benefits include health, dental, life, and disability and other protection cover. These plans are also tailor-made to fit the size and the budget of a company. It also has financial benefits, including tax deductions and risk pooling, a factor that keeps expenses within manageable limits.
This blog breaks down what group benefits are, why they matter, and how small businesses in Canada can make them work. Whether you’re looking to add your first plan or improve an existing one, this guide will give you a clear place to start.
Group benefits are insurance plans offered by an employer to a group of employees. Everyone is covered under a single contract, which makes the plan more affordable and easier to manage. The cost is usually shared: the premium premiums are partially paid by the employers and the rest of the amount by the employees via deduction of it in their payroll.
With numbers, group insurance is very powerful. Better rates can be offered by insurers when the plan is scaled to team size and the risk is spread among more people. This is the reason why even small businesses will be able to get solid coverage without overworking their budgets.
A normal group benefits package consists of a combination of the following:
Group benefits do more than cover medical costs. They give employees peace of mind. A complete guide to small business group benefits can help you build a package with strong supplemental coverage.
Many small businesses mistakenly believe group benefits are only for large firms. However, in the modern business environment, even a small group of employees would require more than a paycheck. It is no longer an option to provide group insurance as an add on value--it is a good business decision to make.
A good employee is indeed really difficult to find as well as hold on to. Group benefits make your business unique. During offer comparison, a good benefits package may be the edge that you will take over your competitors. The benefits develop loyalty in the current employees. These demonstrate to your team that you care about them and the way they feel.
More business owners than you can imagine will find group benefits more reasonably priced than they expect. The plans can be customized to suit your budget and in many cases, they are even shared by the employees. To add to this, the employer is normally tax-deductible to pay premiums. Group insurance is thus a cheap way to invest in a group.
In the case of big salaries, small businesses could not rival or compete with big payment packages, although they could provide good benefits. An organized group scheme can redress the playing field. It enables you to be able to provide the type of support that the employees would normally receive in bigger companies- without you having to go overboard.
The group benefit plans present in Canada consist mainly of a combined health-related with financial plan. Though all plans vary, there are some fundamental elements which are introduced into most of them.
Most of the group plans are based on health insurance. It assists its employees in catering to their routine medical requirements, such as visits to a doctor, hospitalization, and medications. Diagnostic tests, medical equipment and a general assortment of paramedical services: including physiotherapy, chiropractic care, massage therapy and mental health counselling are also covered by it. Those services eliminate out-of-pocket costs, and they motivate workers to take care of their health before the issues can become worse.
Another element in a group benefits plan is dental insurance. It includes both routine services such as cleanings and checkups and procedures such as fillings. Visits to big dental works such as root canal, crown, or orthodontics are also included in many plans. This kind of coverage is effective in the prevention and long term dental health and this is something that employees like.
Vision care assists the employees to meet the expense of their eye test, glasses or contacts. Other plans even have a partial cover or discount of laser eye surgery. Vision care is not included in the benefit of most provincial public health insurances, so it will be advantageous to many workers.
Life and AD&D insurance provides security to a family of an employee. Life insurance is a policy that gives a tax-free amount to the specified beneficiary in case of an employee death. The accidental death and dismemberment (AD&D) insurance provides an additional security in case of accidental loss of life or due to a severe injury, loss of an eye or a limb. These are the advantages that would make the employees have a relieving feeling that their loved ones would be taken care of in case a sudden circumstance occurs.
There are also possible additional bonuses depending on the business along with the needs of their employees. Other organizations have critical illness cover wherein an employee will receive a lump sum in case of a severe illness such as cancer or a stroke. Otherwise, they offer a health spending account (HSA) according to which workers pay their own medical demands which are not met by the program. The employee assistance programs such as counselling and financial advice as well as wellness programs are becoming increasingly common.
There are so many combinations of these components. The trick is to be able to establish just the right balance between cost and value: provide sufficient coverage to cover your team and do so within budget.
All small businesses are unique. And because a certain thing worked out in one team, it might not work in another. That is why their plan needs to be flexible as far as designing group benefits is concerned. You do not intend to break your bank to cover something of value.
Begin by knowing what your workers consider the most. Health and dental might be the first priority to some teams. Other people might wish to have mental health care, eye care or disability insurance. You do not need to provide them everything at a time. Concentrate on the necessities and think in terms of adding extras in the course of time as your business expands.
The majority of the plans will provide you with an opportunity to diversify basic, intermediate, or advanced coverage. You also have a choice to add optional benefits such as critical illness insurance or health spending account. It is also provided by some companies free as a voluntary addition and the employee bears the entire expense should he/she decide to do so.
One can provide benefits without having to dish out worse than he has. You can also control costs by creating a structure of the plan, adjusting higher deductibles or setting limits on maximums or by the co-pay model where the employee shares some of the cost. Small business bundle plans with most common benefits at reduced group rates are also available in many insurers.
The easiest way to compare options is to speak to a broker or benefits advisor. They will assist you to get a plan that fits your budget and can still be of great value to your team.
After you decide that you want to provide group benefits, then you have to select a provider. This choice is important. The right insurance provider or consultant can assist you to develop a plan that matches your team and makes daily operations easier.
First, compare plans with the most known companies in Canada. Do a look at what is covered in each plan, flexibility, as well as how the claims will be paid. Convenience and ease in use is important. An excellent provider must provide excellent digital resources, support, and communication.
The cost can be significant, so don’t base your decision on price alone. A slightly higher priced plan which would contain superior service and coverage may be a more worthwhile investment. Request information on turnaround time, on-boarding assistance and their procedures to make employees comprehend their cover.
When you are new to group insurance, it can be quite time-saving and less confusing to consult a benefits advisor or a broker. They will assist you to compare the plans, explain the fine print to you and ensure your plan is structured to achieve your goals and fit within your budget.
GoKlaim.com helps Canadian small businesses compare plans, simplify setup, and manage employee benefits—all in one easy platform. Whether you're starting fresh or upgrading your current coverage, GoKlaim gives you expert tools and support to get it done right.
Group benefits are insurances designed by an employer to a group of employees. Such plans tend to cover health, dental, vision, life and disability insurance within one contract. They assist companies to maintain good health among the employees besides providing a cost saving element compared to individual insurance plans.
No, small businesses are not prescribed by law to use group benefits. Nevertheless, its provision attracts and retains talents, lower turnover rates, and forms a more competitive environment.
The prices differ according to the number of workers, coverage provided and the contribution employers to make. Other businesses cover the entire premium whereas others share the burden with the employees. There are a large number of providers whose plans begin at just a couple of hundred dollars each month.
Yes. Most insurers provide businesses that have as many as two or three employees with group benefits. There are those aimed at startups and microbusiness.
Most forms of health, dental and disability benefits are not usually taxed by the government as income earned by the employee because the payment of such benefits is borne by the employer. But, any premium paid on life insurance to the employer is generally a taxable benefit. One would be better off checking with a tax advisor.
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