Insights & advice
Should you get health insurance if you’re self-employed?
January 2022 – 15 min read
Key takeaways
If you’re not covered by a workplace benefits plan, you could have to pay health and dental costs out-of-pocket.
With personal health and dental benefits, you can bridge the gap between what’s covered by provincial health careOpens in a new window and what you’ll need to pay for.
This can help to cover expenses for you and your family, which could amount to hundreds of dollars in savings.
You can apply for personal insurance online in less than 15 minutes.
Thinking about health insurance?
There’s lots to think about when it comes to being your own boss, from finding work to filing taxes and just about everything in between. Another important thing that shouldn’t be overlooked is taking care of your well-being – and that includes having a plan in place to pay for medical care.
With personal insurance, you can apply for health and dental benefits to suit your needs and budget to lower your out-of-pocket expenses.
What kind of coverage is available?
There are 3 healthcare options available in Canada:
- Medicare (Canada’s publicly funded health care system)
- Workplace benefits
- Personal health and dental insurance
If you’re self-employed and therefore not covered by a workplace plan, you’ll need to cover the cost of medical care using a combination of options 1 and 3.
Depending on where you live, you may have some coverage provided by your province or territory. However, the extent of this coverage will vary depending on where you live. For example, in Manitoba, you can receive coverage for up to 7 chiropractic visits per year. In Ontario, chiropractic treatment is not covered by the Ontario Health Insurance Plan (OHIP), meaning you’ll have to pay for this treatment yourself.
A private plan can provide coverage that fills the gap between what’s covered by a provincial planOpens in a new window - Opens in a new window and what you pay for yourself. You can select a plan, pay a monthly premium (which may be tax deductible), and can receive coverage for treatments such as:
- Vision care
- Dental care
- Prescription drug coverage
- Travel insurance and out-of-country medical expenses
- Private hospital rooms
- Paramedical expenses
This can not only help cover the costs of routine healthcare, but can be especially helpful if you’re in an accident or become sick and need treatment unexpectedly.
“Aubrey just started their dream job at a tech start up, but it’s missing one thing: workplace benefits. Aubrey is young, mid-20s and proactive about their physical and mental wellness and wants to be able to keep up with routine things like going to the dentist, contact lenses and therapy, and get help with any other future costs their provincial healthcare doesn’t cover.
That’s why Aubrey chose Select, our base Freedom to Choose health and dental insurance planOpens in a new window. It offers 70% reimbursement for their prescription drugs, $300 each year for paramedical services like psychologists, with a per visit maximum of $30. It also includes 70% reimbursement for regular dental services like cleanings, up to $350 a year.”
What kind of coverage do you need?
The kind of coverage will depend on factors such your budget, if you plan to be self-employed for the long- or short-term, and whether you have any pre-existing conditions or ongoing medical requirements. You might also want to think about the type of work you do, and whether it’s high-risk or leaves you in need of specialized coverage.
The best way to find out what coverage you’d need is to get a quote onlineOpens in a new window. You’ll be able to look at options based on your individual needs, such as whether you’re looking for basic coverage on a budget, or more comprehensive coverage that can cover a wide range of medical care and costs.
You can find out more about your coverage options by getting a quote online or speaking to an advisor.
The cost of health and dental benefits
When it comes to choosing your health and dental benefits plan, your monthly premiums will vary based on factors such as your benefits provider, the coverage you choose, and whether you add your spouse or dependants to your coverage. These monthly payments can not only add up to less than you’d pay out-of-pocket in the long run, but they may also provide some tax benefits too.
Are health insurance premiums tax deductible?
Yes, eligible medical expenses can be claimed on Lines 33099 and 33199 of your tax return. The Medical expense tax creditOpens a new website in a new window - Opens in a new window is a non-refundable credit you might be able to claim to reduce the money you’ve paid in healthcare expenses. You may also be able to claim eligible expenses for your spouse or common-law partner. For more info, speak with your accountant when it’s time to file, or visit the government website to see a list of medical expensesOpens a new website in a new window - Opens in a new window you could claim.
What’s next?
Remember that benefits aren’t the only thing you might be missing out on if you’re self-employed. If you’re not contributing to a workplace pension plan, you may also want to look at other ways to save for retirementOpens in a new window.
If you’re a small business that can’t offer group benefits, you may be able to use individual health insurance for you and/or your employees instead. You can get a quote or speak to an advisor to find out more about whether health insurance is right for you.
If you have questions about government rebates, tax credits or any other family benefits, speak to an advisorOpens a new website in a new window - Opens in a new window to make sure you claim everything you can.
Ready to get health and dental coverage?
If you’d like to explore plans and see how much they could cost you, get a quote.
This material is for information purposes only and shouldn’t be construed as providing legal or tax advice. Every effort has been made to ensure its accuracy, but errors and omissions are possible. All comments related to taxation are general in nature and are based on current Canadian tax legislation and interpretations for Canadian residents, which are subject to change. For individual circumstances, consult with your tax, legal or accounting professionals. This information is provided by The Canada Life Assurance Company and is current as of date of publication.
