A Step-by-Step Guide to Understanding Your Options and Implementing an Individual Health and Dental Plan for You and Your Family
Are you leaving your job, retiring, self-employed or just don’t have a benefits plan at your job? Have a plan, but there isn’t enough coverage in a certain area? A solution is to implement an individual plan.
It can be overwhelming to attempt to determine how to best go about placing insurance coverage for you and your family. This article outlines the important factors to consider when deciding if an individual health and dental plan is right for you and your family, including how to choose and implement a plan.
What do we mean by an “individual” health and dental plan?
What we call an “individual” plan is simply a health and dental program that is not a group employee benefits program; in short, it’s coverage for you and/or your family that you choose and pay for directly.
Even here in Canada, where we have a robust universal healthcare system, there are many out-of-pocket costs that fall outside of our provincial medical coverage. For many people, these expenses are covered either in full or partially through their employer’s group benefits program.
However, many Canadians are not, or are no longer eligible for a group benefits plan.
In the absence of a comprehensive group benefits program through your employer, expenses related to Dental, Prescription Drugs and Paramedical Practitioners (physiotherapy, massage, chiropractic, mental health therapists for example) can become a significant expense.
Many Canadians are unaware that they can purchase a health and dental plan similar to the type of extended health and dental program they would have through an employer.
Who is eligible to purchase a private health and dental plan? Who is this type of plan for?
There are many reasons to seek individual coverage, however, we often think of people as falling into two buckets: those who are leaving a group benefits plan, and those who do not have access to a group benefits plan.
Those who were previously covered under a plan enjoy a special “conversion” privilege
For people who will or have recently lost their group employee benefits coverage, this can be for many reasons:
- You have left your job
- You have aged out of the group plan
- You have retired
- You have become a contractor/ freelancer
- You are now self-employed as a small business owner
- You are a dependent who is losing coverage under your spouse or parent’s plan
If you were previously insured under a group benefits program, you have a certain defined timeframe (usually 30-90 days, and this varies depending on the insurance provider) in which you have a conversion privilege.
What is a health and dental insurance “conversion plan”?
In fact, you may have heard the term “conversion plan” which is a bit misleading. This term is often used to describe the setting up of an individual plan, on the heels of leaving a group employee benefits program. Technically, you are not ‘converting’ the plan, you are simply eligible to set up an individual plan without any medical underwriting and approval, based on the fact that you’ve been previously insured.
One important thing to note is that you may not want to exercise this conversion privilege, as it may be more beneficial to complete a medical questionnaire and obtain a medically approved plan instead.
Those who were not previously insured have different options for coverage
The second bucket refers simply to people who were not previously insured under a group benefits plan, within the defined timeframe used by the insurer (30-90 days typically). Setting up an individual plan could make sense if:
- You’re self-employed/ a contractor/ a freelancer/ gig worker
- You’re employed by a company without a benefits plan
- You’re employed but do not qualify for the benefits offering
- You’ve retired, but you’re now outside the conversion window
For new Canadians, visitors to Canada, travelers; there are special considerations and plan options for people in these circumstances, who may not be covered through provincial medical or be a resident of Canada
If you’re looking to set up coverage, there are many options through a variety of providers, at a variety of price ranges. Some plans are medically underwritten and require approval, while some plans are “guaranteed issue”, which simply means regardless of your medical status, you can obtain the plan.
Medically Underwritten or Guaranteed Issue: How do I know what type of plan I need?
The first thing to determine is whether you need to seek a non-underwritten plan. If you have any pre-existing medical conditions (i.e. prescription medications or conditions), you may need to go this route, as you would be denied coverage or have it significantly restricted if you were to disclose your medical situation.
You could choose to apply then assess the results (i.e. certain medications will not be covered) and then decide which option makes the most sense for you.
What are the plan differences between medically UW and not?
Unfortunately, the coverage available on a guaranteed basis is typically ‘lesser’ while also being more costly than a medically Underwritten plan. The reason for this is simple: those that are seeking guaranteed issue plans generally have higher medical expenses, and the insurance company needs to take this into account, financially speaking.
This is why you will notice with many plans that the per-person coverage levels increase over time. For example:
- Year 1- Dental at 70% to $500
- Year 2- Dental at 80% to $750
- Year 3 – Dental at 80% to $1,000 with Major also included, etc
Why would coverage get better over the duration of time you have the plan in place? Because the coverage is paid for on a month-to-month basis, and the plan can be cancelled at any time without repercussions, the insurance carrier needs to build in this sort of stepped coverage in order to ensure the plans remain financially viable.
When would I choose to complete a medical questionnaire instead of choosing a guaranteed issue product?
If you do not have pre-existing medical conditions, it’s likely the best course of action is to complete a medical questionnaire and be “approved.” This should result in the best plan options at the lowest cost.
Why would you do a medically underwritten plan, if you’re coming off a group plan and you’re eligible for conversion/ no medical underwriting?
In short, to gain access to better coverage at a lower cost. Consider the following simple comparison of the “best available” plan, for a Single person in the ages 18-44 bracket:
Conversion From Group
(Leaving another Plan)
Monthly Cost: $244
Drugs:
80% to $2300 (Year 1)
Basic Dental: $1000 (Year 1)
Vision: $300 / 2 years
Guaranteed Issue
(No Medical Issues)
Monthly Cost: $100
Drugs:
70% to $550 (Year 1)
Basic Dental: $450 (Year 1)
Vision: $150 / 2 years
Underwritten Standard
(Medical Questionnaire /Approved Standard)
Monthly Cost: $184
Drugs: 90% to $20K (Year 1)
Basic Dental: $1000 (Year 1)
Vision:
$250 / Year 1 – 2Of course, the full scope of coverage is far more comprehensive, but the purpose of the comparison is to illustrate a few key areas people use the most.
Individual Health and Dental Plan Options Abound:
Whether you are leaving a group plan or setting up an individual plan for the first time, there are many providers available in the Canadian marketplace. It’s worth noting that if you are leaving a group plan, you do NOT need to use the same insurance provider that covered you under your former employer. You have the freedom to choose any plan, and the ‘conversion’ privilege of no medical underwriting still applies to you.
Here at the Immix Group, we frequently recommend Manulife, Green Shield, Sun Life and Canada Life plans (links per each). There are differences between them, and the plan that is right for an individual or family depends on their medical needs and preferences. Most carriers have options ranging from very basic coverage, up to very comprehensive coverage. And of course, the cost varies.
Luckily, there is a plethora of information available online.
How do I compare Individual Health & Dental insurance options? Luckily, it’s easy to compare options online.
For example, Green Shield’s site allows you to easily navigate and compare options, and see the pricing in real-time, without any obligation or requirement to enter your personal information. Manulife also offers excellent information online.
Alternatively, at the Immix Group, our advisors can help walk you through the best option for you, based on your individual circumstances and budget. Or, if you’re more into assessing things yourself, the links above allow you to self-purchase without talking to an advisor.
How much does an individual health and dental plan cost?
We cannot accurately state that one provider costs more or less than another; this varies quite notably based on the plan option selected and the age bracket, or whether the plan is for a single individual, a couple, or a family. The factors that affect the cost are:
- Medically Underwritten vs. Guaranteed Issue
- Age of applicants
- Enrolment (Single, Couple, Family)
- Plan selected, including add-ons (some providers charge for travel as an additional cost, for example, while others include this)
Prices range from under $100 per month to over $500 per month depending on the factors above.
Rates are subject to change, but historically we have not seen large increases. In fact, we have even seen rates decrease in the past! As mentioned previously, you are always paying month-to-month and can usually cancel the plan at any month, without financial penalty. Most providers allow for payment via credit card.
How do you make a claim with an individual health and dental plan?
It’s very similar to what you would have experienced through a group employee benefits plan. If this is new to you, the short answer is that most claims can be made at the point of service (the pharmacy or dental office for example, by providing your plan details), online, or via the mobile app.
There are some instances where claims need to be submitted via paper submission, but this is less and less common these days.
Most people report that the claims adjudication is straightforward, easy to understand, and claims turnaround times are reasonable. Again, while not identical, it is similar to the administration of claims under a group employee benefits program. Additionally, you will find many of the fringe services and programs available through a group benefits plan are also extended to those insured through individual plan offerings.
Are you looking to implement a plan, but still have questions?
As always, here at the Immix Group, we’re happy to help you in assessing your options and choosing the best plan to meet your needs.
Prefer to look and buy yourself? Feel free to browse through our site, where you can implement a plan online yourself.
For more information and for assistance in choosing the best option, contact our office at 604-688-5559 or info@immixgroup.ca – we love to hear from you!
Questions to ask yourself:
- Evaluate whether you meet the criteria for a conversion plan and consider if this is the most suitable option based on your needs.
- If yes, it may make sense to apply for a medically underwritten plan, which can provide better coverage at a lower cost.
- Assess if you have any pre-existing conditions that could affect your coverage options and the type of plan you should choose.
- Consider your and your family’s health and dental requirements to determine the type and level of coverage needed.
- Determine how much you can afford to spend on insurance premiums each month and choose a plan that fits within your budget.
- Think about whether you need extra coverage, such as travel insurance, and whether it’s included in the plan or available as an add-on.
- Make sure you comprehend the distinctions between these types of plans to choose the one that best suits your health situation and financial needs.
Key Takeaways
- Individual health and dental plans provide direct coverage that is separate from employer-provided group benefits, giving you more control over your insurance needs.
- Individuals who are leaving group plans or do not have access to them, such as retirees, freelancers, and the self-employed, can benefit from individual plans.
- Those leaving group plans can set up an individual plan without medical underwriting within a specific timeframe, making the transition smoother and easier.
- You can choose between medically underwritten plans, which offer better coverage and lower costs for healthy individuals, and guaranteed issue plans, which are suitable for those with pre-existing conditions.
- The cost of individual health and dental plans varies based on factors like age, health status, and the level of coverage selected, typically ranging from under $100 to over $500 per month.
- Individual plans offer the flexibility to choose coverage options and providers, unlike employer-mandated group plans, allowing you to tailor your insurance to meet your specific needs.
FAQs
- An individual plan is direct coverage you choose and pay for, separate from employer-provided group benefits. This can cover you and your family members.
- Anyone, including those without access to a group benefits plan or those transitioning out of one, including retirees, freelancers, and the self-employed.
- It allows those leaving a group plan to set up an individual plan without medical underwriting within a specified timeframe.
- While it’s a nuanced decision, generally speaking, one would choose a medically underwritten plan if they are healthy for better coverage and lower costs, and opt for a guaranteed issue plan if they have pre-existing conditions.
- To access more comprehensive coverage at potentially lower costs compared to guaranteed issue plans.
- Costs vary based on factors like age, health status, and plan chosen, ranging from under $100 to over $500 per month.
- Claims can usually be made at point of service, online, or via mobile app, similar to group benefits plans.
- Individual plans typically operate on a month-to-month basis, allowing flexibility to cancel without penalties.
- Plans are generally available to individuals of any age, though some may have limitations on out-of-country travel coverage at certain ages.
- No, individual health and dental plans typically operate on a month-to-month basis, allowing you the flexibility to cancel the plan at any time without financial penalties.
- While it differs from carrier to carrier, you can obtain a plan at any age, up to any age! One thing to carefully consider is any restrictions related to emergency out-of-country travel coverage, which for some plan offerings, can terminate at a certain age.
- Prescription Drugs
- Medical Equipment & Supplies
- Nursing and Homecare Support
- Vision Care
- Hospital benefits
- Registered Therapists and Specialists
- Dental Care Services
- No, there is no age limit to apply for conversion coverage. Premiums for the coverage are age-banded.
- There is no medical underwriting, and acceptance is guaranteed within 60 days of losing group coverage.
- Most conversion plans offer coverage for the following: Dental, Prescription Drugs, and Paramedical Practitioners (physiotherapy, massage, chiropractic, therapists, etc.).
- No, several insurance providers offer conversion plans. You are not tied to the carrier your previous plan was with.
Resources
Compare Options and Buy a Manulife Conversion Plan
Compare Options and Buy Manulife Individual Health & Dental Plans
Compare Options and Buy Manulife Travel Coverage
Conversion Plans- Individual Health Care & Dental Plans
Understanding Travel Insurance: Everything You Need to Know Before Takeoff
Lindsay Byrka BA, BEd, CFP
Vice President, Immix Group: An Employee Benefits Company
A Suite 450 – 888 Dunsmuir St. Vancouver V6C 3K4
O 604-688-5262 E lindsay@immixgroup.ca
W www.immixgroup.ca
