Updated on August 17, 2020
If your employer doesn’t offer a group insurance plan:
You’ll certainly want to think about taking out life, health, disability and travel insurance. Dental and critical illness insurance might be a good idea, too.
If your employer does offer a group insurance plan:
You’ll need to enrol in the plan. There are a number of advantages with corporate group insurance plans—you don’t need a medical exam to be eligible, your employer pays for a portion of your premiums and coverage is available to spouses and children, too. But don’t assume that the coverage offered will account for all of your insurance needs.
Here are 3 questions from our experts to get you started:
1. What is your current financial situation?
A new job might mean a higher level of income, in which case it would be a good idea to take a look at your finances. “The key to managing your personal finances is setting your budget,” says Angela Iermieri, a financial planner with Desjardins. “Make a list of all of your financial commitments and keep track of your expenses, remembering to put aside some money for savings and emergencies.”
During your working years, expenses can really pile up. “Think about your short-, medium- and long-term plans. If you have a partner, talk together and set your priorities,” suggests the financial planner.
When you have a clear picture of your finances, it’s easier to see your real insurance coverage needs.
2. Would taking a disability leave jeopardize your finances?
During your working years, a dependable income is a must. “Disability insurance - This link will open in a new window. certainly provides an income, but it also allows you to maintain your financial independence,” explains Nathalie Tremblay, a life and health insurance specialist with Desjardins. “Have you thought about how much of your income goes to monthly financial commitments? Would you be able to meet them if you had to take a long-term disability leave?”
It’s a difficult situation, and it can last a while. When you and your family are financially secure, you can focus on what’s most important: your health.
If disability insurance is part of your benefits package, be sure to check:
- What percentage of your salary you’d receive with short- or long-term disability insurance
- Whether or not the disability benefit is taxable
- If all your financial commitments will be covered by the insurance benefit
There are other options to round out your coverage too, like insuring your loans against disability and taking out individual disability insurance or critical illness insurance.
3. How much do you plan to leave behind?
Employer group plans usually offer life insurance that covers 100% or 200% of your salary. Would that be enough? Should you take out life and health insurance if you can’t get it through your job? Or, if you have it, should you top up what your employer offers? “This question is harder to answer than you might think. It’s not a yes or no thing,” says Nathalie Tremblay.
She stresses that each case in unique: “Everyone’s situation is different, and our personal values have a big impact on our insurance decisions,” she points out.
If you want to make sure your loved ones will be financially secure or donate to a charity, you may want to think about increasing your insurance coverage. And even if you can convert your group life insurance to individual coverage when your employment ends, the new premium will be based on your age at that time. It might be wise to take out individual coverage now.
To better understand your life and health insurance needs, contact a life and health insurance advisor - This link will open in a new window..