Insights & advice
What happens to my benefits if I leave my job?
March 2022 – 15 min read
Key takeaways
If you leave your job and had coverage through your workplace, this normally ends when you leave your employer.
This means you could lose health and dental benefits as well as insurance that could help protect you and your family.
If you have a workplace pension, you may also need to look at transferring your retirement savings when you leave your workplace plan.
As soon as you know you’re leaving your job, you should explore your options when it comes to keeping or replacing your coverage.
Do you have workplace benefits?
Millions of Canadians are enrolled in a benefits planOpens in a new window that provides health and dental coverage, as well as other benefits that can help you protect your loved ones and plan for the future financially.
Through an employer-sponsored plan, you may have:
Accidental Death and Dismemberment (AD&D) coverage
What happens when you leave your job?
There may come a point when it’s time to move on from your current employer. You may:
Quit your job to accept a new role somewhere else
Find yourself being laid offOpens in a new window or fired
Leave your job to pursue self-employmentOpens in a new window or to start your own businessOpens in a new window
- Switch careersOpens in a new window
- RetireOpens in a new window
Ultimately when your coverage ends will vary depending by plan and provider, but in most cases, you’re only covered when you’re working for the employer. If you resign, your benefits normally end when your notice period is over. If you’re fired, your benefits may end immediately, but they may continue for a certain period if you’ve been laid off.
As soon as you know you’re leaving your employer, have a discussion with your Human Resources (HR) department to find out when your coverage ends. You can also reach out to your provider directly to see what your options are in terms of converting your coverage or purchasing something new to keep your benefits.
How to stay covered
Keeping your health, dental and vision coverage
When your benefits end, you may find that you're only covered by the health plan in your province or territoryOpens in a new window. Generally speaking, these plans will cover things such as visits to the hospital or doctor, but may not cover other healthcare or paramedical services.
Personal insurance can help fill the gap between this coverage and what you pay for yourself, and can be tailored to cover a range of healthcare needs, such as:
Routine dental services
Eye exams, glasses, contact lenses and laser surgery
Prescriptions drugs
Physiotherapy, chiropractor visits and massage therapy
Social workers and psychologists
Naturopaths, dieticians, acupuncturists, no referral needed like all our paramedical services
Keeping your insurance
You can add life, AD&D and critical illness coverageOpens in a new window to eligible Canada Life workplace plans and keep it after you leave your job or your workplace plan terminates. Your rates can even be less than you'd pay for personal coverage, helping you save while keeping you covered.
Keeping your pension and retirement savings plans
If you’re one of the 6.5 million Canadians who are members of a workplace pension plan, you know what a valuable part it plays in your overall retirement planningOpens in a new window. If your workplace retirement and savings plan was with Canada Life, you can easily transfer your account to the Freedom Financial™ NextStep™planOpens in a new window. You can choose from a wide range of products, such as a Tax-free saving account (TFSA)Opens in a new window, Registered retirement savings plan (RRSP)Opens in a new window and Registered retirement income funds (RRIF),Opens in a new window and getting started online is easy.
Another option may be to transfer it to a Locked-in Retirement Account (LIRA)Opens in a new window. When you choose this option, money is transferred from your workplace pension into an account that’s “locked” until you retire. This means you won’t be able to withdraw any money from it to help pay for things like post-secondary education or buying a homeOpens in a new window, but it also means that you have money that’s likely to be there when you’re ready to turn it into retirement incomeOpens in a new window.
The benefits of staying covered
Protect yourself against out-of-pocket expenses
Anything that’s not covered by your provincial or territorial health plan – or healthcare costs that you pay for yourself – are known as “out-of-pocket” expenses.
These costs can rack up quickly, and include but are not limited to:
Most eye exams
Dental care
Physiotherapy, massage, and chiropractic treatments (also known as “paramedical” treatments)
Prescription drugs
Medical equipment, including crutches and wheelchairs
In-home nursing
Ambulance fees
Having a personal insurance plan in place can help you avoid receiving a hefty bill as a result of an accident or illness, and can also help cover out-of-pocket expenses for preventative and routine healthcare.
Protect your family
If your health and dental plan extends to your spouse and dependents, they too may find themselves with no coverage once you lose it. You can find a personal insurance planOpens in a new window that extend to dependents to make sure your family doesn’t lose coverage.
If you’re losing life insurance, your family may no longer be protected financially in the event something happened to you. If you have a family or loved ones who are dependent on you financially, you could look at adding Portable Benefits to your plan before you leave it to ensure you stay covered, or ask an advisor about what life insurance may be right for your needs.
What’s next?
As soon as you know you’re leaving your workplace plan, start looking at options to ensure there’s no gap in your coverage.
You can speak to advisor for help deciding which products might be right for you after leaving your workplace plan.
You can also look online to compare plans and buy coverage that suits the needs of you and your family.
If you are a Quebec resident, personal health insurance can provide supplemental coverage to the prescription drug coverage provided under the Régie de l’assurance maladie du Québec (RAMQ) basic prescription drug insurance plan. Personal health insurance doesn’t remove your obligation to have drug coverage through the RAMQ drug public plan, through your employer or an association you are a member of or through the employer of your spouse.
This information is general in nature, and is intended for informational purposes only. For specific situations you should consult the appropriate legal, accounting or tax advisor.
