Insurance for Newcomers in Canada
There are several types of personal insurance that all Canadians should have in case of emergency. This CanadaVisa guide will help you explore and understand the parts of an insurance policy, as well as some specifics about home, life, health, car, travel, tenant and Super Visa insurance.
Table of Contents
- What kind of personal insurance do I need?
- What are the 4 main parts of an insurance policy?
- What is the best health insurance in Canada?
- What should I look for in home insurance in Canada?
- How much is tenant insurance in Canada?
- How do I get the cheapest car insurance in Canada?
- Who is the best company to get travel insurance from in Canada?
- How much does insurance cost for the Super Visa in Canada?
- What is the best type of life insurance?
- Contact CanadaVisa and Cohen Immigration Law for Assistance
This CanadaVisa guide will take you through the essentials of understanding personal insurance as a newcomer to Canada.
Starting with a general walkthrough of the purpose of insurance and what determines if you need it, we will then move on to provide a discussion about the four main parts of a standard insurance policy. This includes the agreement, the policy premium, the deductible, and any exclusions included in the policy.
From there, this page will include a separate discussion on six different types of insurance that many Canadians need: health insurance, life insurance, home insurance, tenant/renter’s insurance, car insurance and travel insurance.
Finally, this page will conclude with some information about Super Visa insurance, specifically useful for Canadians trying to bring their parents and/or grandparents into this country.
What kind of personal insurance do I need?
Every type of insurance in Canada is designed to protect you and your loved ones from financial loss or hardship in the event that something unexpected happens to:
- You or your family
- Your vehicle
- Your home
- Your belongings
- Your job
One of the following sections of this page will be dedicated to each type of insurance listed above. In addition, this page will provide some guidance on Super Visa insurance for parents and grandparents of existing Canadian immigrants.
Before that, understanding whether or not you need insurance is crucial. This question will largely be answered based on your current stage of life and living circumstances, including but not limited to the following factors.
Note: In some cases, such as with vehicle/car insurance, obtaining insurance is mandatory
- Your living situation (are you moving in with your spouse/partner?)
- Your family situation (are you planning to have kids soon? do you already have kids?)
- Are you buying or renting a home or apartment?
- Are you starting a business?
- Are you buying a vehicle?
- Are you in the process of applying for a loan or obtaining a credit card?
What are the 4 main parts of an insurance policy?
An insurance policy is a legally binding contract between an insurer (company) and the consumer. The main parts of an insurance policy are the agreement, the premium, the deductibles and the exclusions.
This part of an insurance policy outlines the terms and conditions under which the company will be providing coverage to the insured person(s). In other words, this part of an insurance policy specifies:
- Which risks are covered by your insurance company
- Under what circumstances the insurer will make a payment to you
- How much money, or what type of benefit, you'll get if you submit an insurance claim
An insurance policy’s premium is the fee that you pay, as the insured person, to receive the benefits outlined in the insurance agreement. Depending on the terms of your agreement, you may be required to pay this fee on a monthly, quarterly or annual (yearly) basis.
Your insurance premium will depend on such factors as:
Generally, the amount you pay as a premium depends on factors such as:
- The type of insurance
- Your age, gender
- Your medical history (for life and health insurance)
- The value of the goods insured (for home insurance)
- The type of car you drive (for car insurance)
- The amount of coverage you need
- Your deductible
- Your claim history
- The amount you owe for credit protection insurance
The amount that an individual pays for their insurance coverage will vary depending on their provider, the terms of their coverage and the probability that the insured person will make a claim, among other things. In other words, insurance companies typically charge higher premiums to people they think are more likely to make a claim.
In addition, insurance premiums also do not always remain constant. This means that, in some situations, your premium may change over time. This is also true, for example, of people seeking car insurance who have a history of issues with driving. A bad vehicle history can cause your insurance premium to increase because you are perceived as more likely to make an insurance claim than someone with a clean driving record.
Deductibles, as they relate to insurance policies, are the portion of a claim that is covered by the insured person before the insuring company covers the remaining costs. The greater your deductible, the less you typically pay in premiums.
Example: If you make a claim for $1,500 but you have a deductible of $500, that $500 is your responsibility. The insurance company will pay the remaining $1,000 of that claim.
Exclusions, essentially, are the opposite of what is included in your agreement. In other words, as part of your insurance policy, exclusions outline the items that are not included in your coverage.
This may include such things as certain medical conditions you had before you applied (health insurance), claims made if you travel to a high-risk country (travel insurance), or claims for some types of water damage (home insurance).
What is the best health insurance in Canada?
The health insurance you receive in Canada, much like with any other type of insurance, will depend on the offer you receive from the providers you shop around with. This is because every provider will offer you a unique policy with a premium, deductible, benefits and exclusions that are rarely identical to any other service provider.
Moreover, with health insurance specifically, we can break it down into two general categories across the country: public and private insurance.
Public health insurance comes from the provincial or territorial healthcare plan designated by your specific province or territory of residence. These provincial and territorial health plans cover most of your basic health care needs.
Meanwhile, private healthcare plans cover other healthcare needs that are not contained within public plans. In most cases, this includes coverage for dental care, vision care and podiatry (foot health). Private healthcare plans are offered by various providers in each community across Canada, meaning that each consumer will need to conduct research and choose the plan that works best for them, much like car insurance or travel insurance.
Private health insurance coverage may help:
- Pay for services that aren't covered by your public health care plan such as special nursing services, ambulance services, wheelchairs and other durable equipment
- Supplement your income if you suffer a major illness or severe injury
- Pay for your medical expenses if you become ill while travelling
On top of private and public health insurance, full-time employed Canadians typically receive some insurance coverage from their employer. It is important to review your employer’s benefits plan to ensure you don't buy coverage you already have.
Please visit CanadaVisa’s page called Get Healthcare in Canada: A Guide for Newcomers for more information on health insurance in Canada.
What should I look for in home insurance in Canada?
Home insurance covers the owner of a property in case something happens to their home. As with any other type of insurance, the policy you obtain will have different terms, conditions and exclusions than other consumers based on the agreement you come to with a provider. You should aim to buy home insurance coverage that protects you from as many types of damage as possible for a price that you can afford.
Generally, home insurance policies cover such things as:
- Damage or loss to the home itself
- Damage or loss to personal possessions inside the home
- Personal items taken from your vehicle
- Damage or injury sustained by visitors to your home
- Accidental damage inflicted by you on someone else’s home
How much is tenant insurance in Canada?
The price of tenant insurance – also called renter’s insurance – can vary, as this type of insurance is also provided by a wide range of companies that decide on price based on factors such as the provided benefits and the deductible.
This type of insurance, unlike home insurance, is for Canadians who live in an apartment or rent a home from a landlord.
Note: The Government of Canada recommends that you obtain enough coverage to handle the cost of “replacing everything in your home if it's destroyed or stolen.”
While coverage varies based on the consumer’s agreement, tenant’s insurance usually covers the following:
- Damage or loss to personal possessions inside the rental property
- Personal items taken from your vehicle
- Damage or injury sustained by visitors to your home
- Accidental damage inflicted by you to any part of the rental property
- The cost of living expenses (limited) if unable to live in your apartment due to a loss covered in your policy
Example: Tenant insurance may cover the costs associated with fire-related damage to your apartment
Tenant’s insurance is a lesser-known type of policy. Your landlord’s insurance may cover the home itself, but many damages are not covered by this insurance plan (fire or flood damage, for example), making this an important consideration for all Canadians.
How do I get the cheapest car insurance in Canada?
The key to finding cheap car insurance is shopping around for the best deal available. Communities all across this country have multiple providers of car insurance, all of whom offer different rates than one another. The price you pay for car insurance will depend on the damages you would like covered under your policy, as well as your driving history, premium and deductible.
The key to car insurance, however, is that it is mandatory for all Canadians who are operating a motor vehicle. Read more about car insurance on CanadaVisa’s Driving in Canada as a Newcomer page.
Generally speaking, car insurance plans in Canada protect insured persons from:
- Paying full price for repairs due to damage caused by an accident
- Facing serious liability claims if responsible for an accident that inflicts causing damage to another vehicle or injury to another driver
Who is the best company to get travel insurance from in Canada?
Once again, the best company to get travel insurance from is whichever company offers you the most coverage for your most affordable price. This is why taking the time to shop around for insurance is the best way to go about it, rather than rushing the process and buying coverage from the first company you find.
This type of insurance should be bought for any travel you are doing outside of Canada, from a single day in the United States to a month-long trip somewhere in Asia. Of course, the coverage you obtain will be different depending on the trip you are taking, including the mode of transportation you are using to travel as well as other considerations.
For instance, if you are driving just across the Canada-US border for a day in Buffalo, New York, you may only require travel health insurance and or vehicle coverage in case of an accident. Meanwhile, for longer trips that require a flight, you will want to be covered for such things as health complications, trip interruption, and lost luggage or documentation (passport).
How much does insurance cost for the Super Visa in Canada?
According to rates.ca, a Canadian insurance rate comparison tool, “the average super visa insurance cost for one person travelling to Canada for one year is between $100 and $200 dollars per month”. Of course, this cost varies based on many of the same factors that influence the cost of other insurance types, such as age and history (medical etc.), making it crucial that Super Visa applicants shop around for the best available rates.
Immigration, Refugees and Citizenship Canada (IRCC) have a popular immigration pathway called the Super Visa program. This program provides newcomers to Canada with the opportunity to bring their parents and/or grandparents to Canada temporarily for periods at a time.
As part of the process for obtaining a Super Visa, applicants must provide proof that they have obtained private medical insurance from a Canadian company that is:
- Already paid in full or will be paid in instalments (with a deposit already made); quotes aren’t accepted)
- Valid for at least one year from the date that a parent/grandparent will enter Canada
- Suitably able to cover the insured person’s health care, hospitalization and eventual return to their home country
- Able to provide at least $100,000 in emergency coverage
Note: Private health insurance, in this case, must be valid each time the Super Visa holder enters Canada. The visa holder must be prepared to show proof of paid insurance to an IRCC officer any time they ask to see it.
What is the best type of life insurance?
Life insurance policies vary by provider, meaning that the best type of life insurance you can receive depends largely on your individual circumstances and needs (current health, affordability etc.).
Generally, life insurance can be described as insurance that pays out a “death benefit” to help your loved ones handle the financial impact of your passing.
Note: Death benefits are paid out as tax-free, lump sum payments to the beneficiaries indicated on the policy
The purpose of a death benefit, specifically, is to aid any beneficiaries you list on your policy with:
- Replacing your income so your family can maintain their standard of living
- Providing for your children or dependents
- Covering funeral expenses
- Paying off debts
You may also choose to leave the money to your estate or to a trust.
Do you require Canadian immigration assistance?
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