Insurance

The Ultimate Guide: Canadian Insurance Products To Consider

When it comes to the various types of insurance products in Canada not all options are mandatory.

Today I want to discuss the most talked about insurance products in Canada because I wanted to learn about them all.

This post is not just about basic life and home insurance it’s everything and more.

If you want to know what you could be missing when it comes to insurance products you’ll enjoy this read.

I learned quite a bit during my research and definitely would recommend that all Canadians know their options.

Insurance Canada

Understand What Insurance Products Are Available To You In Canada

Insurance can be tricky and overwhelming for newcomers to Canada, young adults, new parents, and even someone like me in his 40’s.

I’m always learning about different types of insurance in Canada and the reasons why they are needed.

My First Insurance Claim In Canada

Many years ago I was on my way to work in my new truck and a deer decided to plow into me from the side.

Not only did the deer heavily damage my truck but I was rushed to the hospital from glass shatter and the deer smashing into me.

The deer hit the side of my truck, onto my windshield then the back end through my driver’s side window.

I’d never experienced anything like it in my life and there was zero reaction time as the deer jumped out from the ditch.

It was then that I was thankful for the healthcare system in Canada, my auto insurance, and making sure I had alternate transportation insurance.

If I did not have that I would have needed to rent a vehicle plus more vehicle insurance to get back and forth to work.

This could have cost me quite a bit of money depending on how long it takes my auto insurance company to inspect the damage.

If there is no way to repair the damage them I’m left hunting for another vehicle which doesn’t happen overnight.

Needless to say, I was happy that I had all of that sorted ahead of time.

The only thing I didn’t have was roadside assistance with my insurance company or CAA which we have now had for many years.

Overall, my truck was fixed by the insurance company which took one week and I got a loaner car that I still paid extra insurance on just in case.

Medically, I had lots of bruises and cuts all over my face and body not to mention a tonne of blood from the deer and myself.

I ended up being ok though so I was very lucky and I’m damn afraid of those deer now and I watch like a hawk when I drive.

Canadian Insurance Products To Discover

Below you’ll find out a little bit about each insurance product and why you may or may not need to purchase it.

If you see an insurance product that is for Canadians and not on my list email me or comment below.

One of the most important things I’ve learned since moving to Canada from the UK in 2007 is insurance-up.

By that, I mean making sure that we have the proper insurance to cover our needs in the event something should happen.

Most people don’t think about insurance coverage until something does happen but then it’s too late.

Often without insurance coverage costs to you could run as low as product loss to hundreds of thousands of dollars if you cause death or in need of medical assistance outside of Canada.

What is Insurance?

Insurance is like a gold document called a policy between you and your insurance provider.

This insurance policy can save your life financially when it comes to medical emergencies and protects you from financial loss.

Do I need insurance?

This is a good question and one that I’m asked often and it depends on what the insurance is for.

You may not need life insurance if you have no dependants but you may want to get critical illness insurance in the event you become critically ill and can no longer work.

The most important part of insurance is knowing what insurance products are available to you and whether they fit your lifestyle. S

Some insurance products are mandatory such as some of those for auto insurance or if you were to own a home.

What is an Insurance Premium?

An insurance premium is an amount of money an individual or business will pay yearly for the policy coverage you purchase.

For example, our home insurance premium is $1500 a year and we pay that monthly however you may get a discount if you pay in a lump sum.

Many insurance companies offer discounts if you bundle insurance products with them and definitely worth asking or looking into.

The insurance premium is income for the insurance company you are with which they use to pay for claims and the business.

Like any insurance, there will be people who use it and others who will not but pay into it just for peace of mind.

How does an insurance deductible work?

When you file a claim in Canada the insurance deductible is what the policyholder will pay.

For example, if your windshield shatters because of a rock hitting it while driving on the highway your insurance should cover that cost.

Whatever company you choose to do the windshield replacement charges the insurance company for the job you pay the deductible and the insurance covers the rest.

How do I pay for Insurance?

You can choose to pay your insurance by cheque, in person, credit card, online banking, or even a banking app.

If you don’t pay your insurance premiums on time your insurance company may discontinue your policy.

Where can I buy insurance in Canada?

There are a few places you can go to buy Canadian insurance products.

We have our insurance products and retirement savings products purchased through our financial advisor.

Our home insurance and auto insurance was purchased from an insurance agent.

If you opt for an insurance broker this person will find you the best rates and deals that fit your budget.

  • Insurance Agent
  • Financial Advisor
  • Insurance Broker

According to Morison Insurance in Canada is that brokers work on getting the best price for you.

The main difference between an insurance broker vs agent has to do with choice and independence.

An agent and direct writers – such as banks – represent only one insurance company.

These are often call centres with salespeople employed by one insurance company.

There is no comparison shopping for other coverages and prices.

Property Insurance

property insurance Canada

Property insurance also is known as ‘Homeowners Insurance’ is broad insurance that covers your home from several things, notably Fire & Theft, and personal liability.

Even if you have vacant land you’ll want to have property insurance as it protects homeowners and landowners in the event of premises and content damage.

If you live in a Condo or Townhome, your strata fee pays for your property to have fire insurance coverage, you only have to cover your contents insurance for theft, etc.

Your lender will most likely only require proof you have fire insurance coverage on your home unless it is a strata property.

A few Credit Unions require Earthquake coverage in B.C.

Mortgage Life Insurance

Although I’m not a huge fan of mortgage insurance many people still opt into getting it because it meets their needs.

Mortgage life insurance is something you purchase as a mortgage owner.

This type of insurance policy covers the balance of the mortgage owing in the event of the death of the mortgage holders.

However, if you opt for life insurance and someone dies for whatever reason you get the full policy amount for the beneficiary to use as needed.

Related: Understanding Mortgage Insurance In Canada

Title Insurance

What is title insurance?

Title insurance is an insurance policy that protects residential or commercial property owners and their lenders against losses related to the property’s title or ownership.

Title insurance is not a requirement in Ontario although you should talk to your real estate lawyer before declining.

Title Insurance Coverage

What does title insurance cover?

  • Title defects or issues with the property
  • Liens against the property
  • Encroachment issues
  • Title Fraud
  • Errors in surveys and public records.

You can read about understanding Title Insurance In Canada.

Renters Insurance

Tenants Insurance in Canada is an insurance policy that protects you and the contents of your home in the event of a fire, theft, damage, etc.

The cost is low for this and you can easily get a tenants insurance quote online if wanted a ballpark idea of what you might be paying.

You should have tenants insurance for 2 main reasons in my opinion or at least this is what would scare me enough to get it.

Liability, Personal Liability

As described above in the event a guest gets injured inside your living area and decides to bring you to court and sue it’s best to be covered.

If you lose you may be on the hook for court fees and settlement fees.

You don’t want to be paying out-of-pocket for these charges.

Your entire financial world can be turned upside down in an instant.

This may also protect you or a guest in case damage is caused to the building not only your apartment but the entire building.

You can read all about renters’ insurance here.

You can also find more information at the Insurance Bureau of Canada another great resource set up for Canadians.

Condo Owner’s Insurance

Like an apartment building a condo complex has insurance for the building but not for your unit or what assets you have inside.

This is why it’s important to have condo insurance to protect what you work hard for in the event of a fire, break and enter, theft, or property damage.

According to Sonnet Insurance Canada, their condo insurance covers the following:

  • Liability Insurance protects you and your visitors in your condo as well any unintentional damage you may cause.
  • Personal Belongings

Often called contents insurance, this protects anything you own that you could pack in a bag or put in a moving truck.

Things like your clothing, electronics, furniture, etc. are covered no matter where they are (whether they’re in your house or not).

Just keep in mind, if you’re renting out your condo, only major appliances (like your fridge, stove and washing machine) are covered for theft.

  • Extra Expenses such as having to live in a hotel until repairs to your condo are completed.

There’s also sewer backup, overland backup, and optional extra insurance if you need more than what will be provided.

Travel Medical Insurance

insurance travel

Travel insurance is a must any time you travel outside of the province or Canada.

This type of insurance will protect you in the event of an accident or illness.

Health and Dental Insurance

dental xrays

Health and Dental insurance is great for people who are retiring, self-employed, or have no benefits provided by their employer.

When you don’t have group benefits you should look into the costs of health and dental insurance to take care of yourself and your family.

Health and dental insurance will help pay for costs that our provincial government will not cover such as drugs, ambulance, hospital, vision care, and so on.

Canadian Visitors Insurance

This was something I was not aware of but if you are visiting Canada as I did for 4 months while we were dating you can get insurance coverage while you’re here.

This type of insurance will be for someone who is not eligible for health coverage under the Canadian government.

If you’re in good health and a landed immigrant, worker, foreign student, visitor, or even Canadian expatriates this is the visitor insurance you’ll need to get a quote for.

It will protect you while you are staying in Canada in the event something should happen to you such as illness or an accident.

Auto Insurance

auto insurance Canada

We have our auto insurance through Johnson Insurance but my inlaws have theirs through Dejardins Insurance which is the focus of this Auto Insurance section.

Liability Insurance is coverage that protects you when the cause of an accident is your fault.

If there is damage to another person, property, or vehicle liability insurance is your savior.

Liability insurance will also cover your court costs and lawyer fees in the event you are sued which could cost thousands of dollars.

Do you need liability insurance? A hard yes! Every province has a minimum amount you must purchase although you can increase that. Like any other increase, you’ll see the cost for this coverage swell as well.

Accident Benefits

car accident

These types of benefits are mandatory because they protect you when you are in a vehicle accident.

The accident benefits may cover income loss or job loss, rehabilitation (physio, therapy, etc), funeral, and death benefits although you can purchase this insurance separately as well.

Collision coverage comes with a deductible that is set by you the driver but starts at a minimum.

This type of coverage is for the vehicle. For example, if you were to get into a collision your coverage might include collision with an animal (erm, deer), object, vehicle, or if you roll your vehicle into space.

Our deductible is $500 which means we pay the first $500 of the repair costs of what our insurance policy covers.

You can bump your deductible to $1000 if you want which may lower your premium but increase your deductible in the event of a collision.

Not all vehicles have collisions especially if they are junk cars running on their last leg of life. The owner might not care and would just scrap it.

If you are leasing or financing a vehicle you may be required to buy collision coverage to protect the buyer and seller.

Comprehensive Coverage

You’ll find comprehensive coverage to be the insurance that covers anything that is not caused by a collision.

The types of coverage may include,

  • Theft (most common) when someone steals your vehicle.
  • Floods when you forget to shut the window and your car floods? Your street floods and it impacts your car? You drive through a flood because you had no other alternative.
  • Wind damage when the wind blows your car away or perhaps a tornado takes it to Oz.
  • Hail damage if chunks of  hail cause a window chip, paint chip, dents on your vehicle
  • Fire Damage when your car catches on fire explodes or you have a house fire that gets to your car.
  • Vandalism (I wonder if they would cover a chipmunk who chewed our neighbours wires inside of the engine? ha)

Again, the deductible is up to you and whether you want to lower your premium or pay more out of pocket in the event something should happen.

Uninsured Automobile Coverage

This is mandatory coverage that all drivers need which covers you in the event of a hit and run or by an idiot who is driving without any liability insurance and hits you.

Transportation Replacement

As I mentioned above when I got hit by a deer I luckily had this coverage on our insurance policy so I was able to get a rental.

If you have a second vehicle you can use (we didn’t) then you don’t need to take out this coverage.

Emergency Roadside Assistance

emergency roadside assistance

When you run out of gas, lock your keys in the car, or need a tow this is when having emergency roadside assistance comes in handy.

The day I was hit by a deer I had to pay the towing fee because I didn’t have CAA but for some reason, our insurance company ended up covering it.

I didn’t ask any questions if you know what I mean.

Since then we have purchased CAA yearly to make sure we always have some form of emergency coverage while we are driving.

Recreation and Leisure Vehicle Insurance

Just as owning a vehicle there are recreation and leisure vehicles that must be insured before you can use them.

Let’s have a look at the common ones.

Motorcycle Insurance

motorcycle

If you own a motorcycle there is special insurance just for you that covers injury to yourself by an uninsured driver, damage to your motorcycle or side-car, bodily injury that you cause to yourself or property while on your bike.

Do you need motorcycle insurance? YES!

Boats and Other Leisure Crafts

If you own a boat or any other type of leisure craft in Canada you will need to purchase insurance for it.

Having this type of insurance also protects you if you have an accident and cause injury to someone else or their property.

You will also be covered for legal defense if you were to be sued which is very important to consider as it could happen.

They also offer, emergency services, wreck removal, watercraft replacement, death and funeral expenses as well as accidental death coverage for anyone operating a watercraft which is optional.

So, very similar to a vehicle insurance umbrella but for a watercraft.

For example at Dejardin’s their watercraft insurance perils cover the following,

Insured perils

Our watercraft insurance policy will provide you with the best coverages (all-risks with some exclusions) for your watercraft and its motor, such as:

  • Sinking
  • Fire
  • Storms
  • Theft
  • Capsizing
  • Stranding
  • Collision
  • Explosion

Property coverages

  • Equipment permanently attached to the watercraft
  • Anchors
  • Oars
  • Electric trolling motors
  • Extra fuel tanks
  • Tools
  • Detachable canopies
  • Seat cushions
  • Life preservers
  • Dinghies

Snowmobile Insurance

Similar to the watercraft insurance the snowmobile coverage will look after;

  • bodily injury
  • theft
  • vandalism
  • fire
  • accidents
  • damage to property
  • injury someone else

Having these types of toys are nice to have but for the small cost of having insurance, it gives you peace of mind.

Even if your snowmobile is in storage off-season your insurance policy will cover it for theft.

Group Insurance (Employer Sponsored)

This type of insurance is offered by your employer where the employee may pay a small premium based on the coverage.

Some employers offer various benefits packages to their employees at different price points.

You don’t need to take the employee benefits but you’d be silly not to since it covers all sorts including but not limited;

  • Dental insurance
  • Medical
  • Travel
  • Physio, Occupational therapy, Massage, Acupuncture, etc.
  • Nutrition
  • Eyewear
  • Group Life insurance
  • Retirement Savings

According to Benefits Canada, the five most common employee benefits offered by Canadian employers are

  1. health and dental insurance
  2. group life insurance
  3. training expenses
  4. vehicle allowances
  5. gifts and awards

These results are according to a survey by the Canadian Payroll Association (CPA).

Life Insurance Products

When we think about insurance products in Canada life insurance springs to mind mainly term life and whole life insurance.

Let’s take a look at the differences however keep in mind that each insurance company or advisor has policies that differ from company to company.

Term Life Insurance

Term life insurance is the cheapest and most affordable life insurance in Canada.

With budgets being so tight most people opt for term life insurance and are straightforward and simple to understand.

Term life insurance is a type of life insurance that provides coverage for a specific number of years which is known as the term.

The shortest term length available in Canada is 10 years.

Typically, you will try to match the length of the term with how long you require life insurance.

If you pass away before the term comes due, the beneficiary of the policy (typically your spouse, children or estate) will receive a death benefit.

The death benefit is paid out to the beneficiaries typically as a one-time, lump sum amount tax free.

Many Canadians are unaware that life insurance is 100% tax free. – Source

Sunlife Go Life Insurance

In as little as ten minutes, anyone legally living in Canada between the ages of 18-74 can receive a quote and apply for coverage.

Sun Life Go gives people the flexibility to help meet health and financial needs with convenient access to insurance coverage.

Sun life Go. The online life insurance that has you temporarily covered the moment you apply.
Providing solutions to help meet your needs, choose coverage ranging from $5,000 to $1 million.
With a 30-day free look at all policies, life insurance has never been brighter

Sun Life helps Clients achieve lifetime financial security and live healthier lives.

Check it out for yourself right here.

Permanent or Whole Life Insurance

What is permanent life insurance in Canada?

I went to Sunlife Canada to find out and here’s what they have to say.

Permanent life insurance is often called whole life insurance because it covers you for your whole life.

It gives your beneficiaries a tax-free payment after you die.

Some plans can build cash value over time. Permanent insurance costs are usually guaranteed not to increase from the time you first buy the policy.

And some permanent insurance plans let you pay for a limited time and then never again.

Universal life and participating life are other forms of permanent life insurance to consider.

Par Whole Life Insurance

We currently changed our life insurance with Manulife Canada to their Par Whole Life Insurance since our term insurance was coming due.

The best part was the transition over without another medical needed.

  • Earn an annual dividend to grow your insurance coverage and cash value beyond guarantees
  • Choose how long you pay your premium and, how frequently
  • Access your policy’s cash value at any time or, if you become disabled
  • Make additional payments into your policy to increase your protection, whenever you choose!
  • Reach your long-term financial goals and benefit from tax-advantaged options
  • Build collateral for a loan, enhance your estate planning, and compliment a retirement plan

Critical Illness Insurance

critical illness insurance Canada

Critical illness insurance is a policy that you purchase from your life insurance provider that will pay you a lump sum for critical illness.

Not all critical illnesses are covered so it’s important to discuss this with your policy advisor and to always tell the truth.

Critical illness insurance often covers illnesses such as cancer, heart attacks, or even a stroke where you are no longer able to work.

This can be finicky if they find out you’ve had an existing illness and you try to make a policy claim.

Protecting your family if you are the main breadwinner with critical illness insurance while you are healthy is a smart investment.

Disability Insurance

What is a disability?

A disability is something that prevents you from living and functioning in life which keeps you away from work and often family and friends.

You may have a disability that is a mental illness or one that you cannot see. Some disabilities are obvious and others that are not.

A disability is any condition of the body or mind (impairment) that makes it more difficult for the person with the condition to do certain activities (activity limitation) and interact with the world around them (participation restrictions). – Source Centre For Disease Control and Prevention.

It may be permanent disability or one that is short-term and may go away quickly.

Disability insurance can help protect you and your family from an unexpected illness or accident that leaves you unable to work and earn an income.

Generally, disability insurance replaces between 60% and 85% of your regular income, up to a maximum amount, for a specified time if you: temporarily can’t work.

Disability insurance can help protect you and your family from an unexpected illness or accident that leaves you unable to work and earn an income.

Generally, disability insurance replaces between 60% and 85% of your regular income, up to a maximum amount, for a specified time if you:

  • temporarily can’t work
  • are permanently disabled due to an injury or illness

If you don’t have short-term disability coverage and your employer does not offer one, you may be eligible for Employment Insurance (EI) sickness benefits.

To be eligible for EI sickness benefits, you must:

  • usually have used all of your sick leave
  • have worked enough hours

Find out if you’re eligible for EI benefits.

Long-term disability Insurance

hospital room

Long-term disability insurance benefits generally begin when the following benefits end:

  • short-term disability insurance
  • sick leave benefits from your employer
  • EI benefits

Most long-term disability plans will replace 60% to 70% of your normal income.

Each disability plan is different. Some may provide disability benefits for up to two years if you’re unable to return to work.

After two years, you may continue to receive benefits only if you’re unable to work at any job.

Short-term Disability Insurance

Short-term disability coverage typically provides benefits for up to 6 months while you’re sick or injured.

If your employer has a short-term disability plan, your claim must be made through your disability plan.

Employers aren’t required to provide paid sick leave and each employer is different.

Funeral Insurance

hearse

If you have no life insurance or money set aside for a funeral you may want to consider buying funeral insurance.

This type of insurance is designed to only cover funeral costs and expenses which can be overwhelming for a family.

No one in Canada will be left without a burial but being prepared is far better than worrying when the time comes.

Related: Average Canadian Funeral Costs In Canada

Various Insurance Products

With Event Ticket Protector insurance, if you can’t attend an event for any covered reason – such as;

  • illness
  • airline delays
  • traffic accidents, and more

For these types of issues you can be reimbursed for your ticket cost and eligible fees.

Coverage includes the ticket price, taxes, convenience fees and shipping charges along with all other event–related items that have been added to your order, such as parking – up to a maximum of $1,000 CAD.

  • Jewellery Insurance is usually purchased from your insurance advisor.

Pet Insurance

Pet Insuranc Canada

The first question you should ask before you get a pet is, Can I afford a pet?

There are lots of costs involved with owning a pet from food to clothing to medications that can cost into the thousands over a lifetime.

Do I Need To Buy Cat Insurance?

That’s up to you and whether you can afford it however it probably is a smart idea.

One of the best companies to buy pet insurance from in Canada is Trupanion which we considered with our pet.

He passed away shortly after.

Get a FREE cat quote from Trupanion

Pet insurance no matter why type of pet you have will never be a waste of money if you consider the costs of veterinarians in Canada.

This is why it’s so important to budget for your pets, have emergency savings, and to consider getting pet insurance.

Related: How much does it cost to raise a cat in Canada?

Business Insurance Products

Business insurance is important because it helps to grow their team and to be prepared for situations beyond their control.

By contacting an insurance agent they can help you come to create a business insurance plan that fits for your business.

These types of insurance and benefits packages also help to recruit and retain employees when they know you are looking out for them.

Many insurance companies who offer business insurance will also discuss with you other forms of insurance for your business such as;

  • liability
  • property insurance
  • commercial vehicle
  • auto insurance

Identity Fraud Insurance Insurance Products

Your finances are such an important and private part of your life the last thing you want is someone to steal your identity and ruin it.

For a small fee, you can purchase identity fraud insurance that will help clean up the mess that someone makes when they steal your identity.

Anything from your credit score to making phone calls on your behalf, legal fees, to sort the situation to pay for fees you incur.

Depending on your identity fraud insurance policy it may even pay for lost wages, daycare for your child or other dependants.

With today’s technology, anything is possible and it’s happened more than once that identity has been stolen so it’s simple insurance to tack on to your other insurance products.

This also gives you another motivation to make sure that you check your credit score and credit report yearly.

Legal Expense Insurance For Gun Owners

If you live in Canada and are in possession of guns that are registered legal expense insurance is something to consider.

Licensed firearms owners should strongly consider getting Firearm Legal Defence Insurance. The firearms laws in Canada are very strict, yet very confusing and not well understood even by police officers.

Since even the “paper crimes” (e.g. forgetting your licence at home and going to the range) carry mandatory minimum prison sentences that would destroy most people’s lives, it is a good investment. – Ken Quick (Facebook CBB)

What is legal expense insurance?

This is Firearm Legal Defence insurance for Canadians who have guns.

For just $95 a year in the event, something should happen and you are sued legal expense insurance will guide you through policies and pays your legal fees while defending your rights.

Legal Expenses Covered

  1. The cost of retaining a lawyer or other appointed representative, including court fees, experts’ fees, police reports and medical reports.
  2. Costs awarded by the court to opponents in civil cases if the insured person has been ordered to pay them, or pays them with the agreement of the insurance company.
  3. Lost salary or wages for the time the insured is off work to attend court or any other hearing at the request of the appointed representative, up to a maximum of $500 per day, and $10,000 in total.

The maximum benefit payable is $250,000 per occurrence or up to $1,000,000 for multiple occurrences in the same policy year.

Visit firearmlegaldefence.com for more info.

Insurance Is Your Protection

No matter what you insurance products you choose to purchase ultimately it’s up to what you can afford and what fits your needs.

We own many of the insurance products above since doing our research and feel protected and happy that we don’t have to worry as much.

Discussion: Are there any other types of Canadian insurance products that should be added to this list?

Leave me your comments and experiences below and I’ll reply back.

MR.CBB

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2 Comments

  1. If you run a home-based business, there’s insurance. The business pack covers you for errors & omissions plus if any of your business related equipment is stolen.

    In BC, our CAA equivalent is called BCAA and they sell insurance. But they discriminate against horse owners. The last time they declined to sell me insurance they accused me of running a horse business which was a huge news flash to me. It’s just a riding horse, hit the trails. No one else rides my horse. I asked BCAA Insurance to tell me what kind of horse business and how much I’m making and what’s happening to all this money this fictional horse business brings in because I’m sure not seeing it, but they refused to answer. My mistake was when I was getting a quote I told the agent I was just heading out next to see my horse, so that’s how they found out I was one of these low life horse owners.

    Also some insurance companies decline insurance coverage depending on if you own certain breeds of dogs. So not everybody is eligible to buy insurance no matter how much they’d like to do so, either dog or horse owners get discriminated against. It just means keep searching for another insurance company.

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