What is an optional benefit in group insurance?
Suppose the benefits you are offered in your new job are like many others in Canada. In that case, they include these typical coverages: life insurance, extended health insurance, dental insurance, accidental death and dismemberment and long-term disability coverage. Typically, your employer pays for a particular portion of these coverages, and you pay the rest.
But maybe your benefits include optional benefits, which may include:
Optional additional group life insurance
Optional life insurance for your dependents
Critical illness insurance
Home and car insurance
The advantages of optional guarantees
Your employer may also offer, although not strictly optional benefits, group discounts for gym memberships, eyeglasses and other health-related products and services. In addition to taking advantage of the savings associated with group rates, you can be sure that your employer has done their homework and approved the providers of these products and services.
Optional benefits also offer another significant advantage: convenience. Keeping track of renewal dates, premiums, and policy terms for the various types of insurance your family needs can be tricky. By purchasing optional benefits through your employer, you get the convenience of payroll deductions and, with many providers, full online access to all relevant provisions and claims information.
You could also benefit from group insurance if you have health problems that would prevent you from qualifying for individual life insurance or make it very expensive since group life insurance is generally available, up to a certain level of coverage, without you having to undergo it a medical examination. However, a group of critical illness insurance excludes pre-existing conditions typically.
What are the most common optional benefits?
According to The Conference Board of Canada, the optional benefits most often offered to Canadian employees are life insurance and critical illness insurance.
Do you need optional life insurance?
To help you determine if you need optional life insurance, you can start by calculating the amount of life insurance. Enter information such as your income, assets, debts, and replacement income your family would need if you die into the calculator. The calculator subtracts your total liabilities from your total assets (including the introductory amount of life insurance your employer provides) to determine the amount of optional life insurance you need. You can also calculate the amount of critical illness insurance you wish to benefit from.
Finally, the optional group life and critical illness insurance provisions are the same for all participating employees. If you wish to obtain more individualized coverage than that offered by the optional guarantees, you could take out an individual contract.
