When you own a small business, you must understand the ins and outs of small business health insurance, almost like an insurance glossary. Group benefits plans help protect you and your employees during accidents or medical emergencies. Employees may not want to work for your company if you do not offer group health benefits.

Group Enroll helps millions of Canadians find the best group insurance quotes each year. We work with the best insurance companies nationwide, including Sun Life and Manulife. You can use our service to find the top insurance provider for your company.

When you understand small business health insurance, it takes a weight off your shoulders and allows you to get the most out of your employees. Below are some of the most valuable terms you need to know to understand small business health insurance.

Insurance Terms to Know When Signing Up for Health Insurance

Signing up for small business health insurance can be daunting. Below are some of the most frequent insurance glossary terms you will encounter when signing up for an insurance policy.

Rider/Endorsement

Sometimes, you may want to add additional benefits to your business owner’s policy. An endorsement, also known as a rider, is a tool that allows you to purchase extra perks for your insurance plan. You must make sure that you know what your insurance policy offers before signing up for an insurance plan.

Policy

A policy is the written agreement that an insurance provider gives to potential policyholders. In the contract is an outline of the coverage you will receive when you sign your forms. It will also list any terms and conditions of the agreement.

Insurance Premium

A premium refers to the amount of money you pay for additional insurance benefits. You must pay a premium for any services you want that are not a part of your insurance policy. Many insurance providers offer $0 premiums to entice customers.

Small Business Health Insurance Quote

When searching for an insurance policy, you will receive quotes from insurance providers. A quote refers to the estimated cost of your insurance plan. Please note that the total price of your group plan could differ from the insurance company’s estimate.

Digital Assets

Digital assets are virtual business data that you store on a computer. These assets provide value to your company and contain sensitive information regarding your financials and employees’ private information. You must invest in cybersecurity to keep these files safe and secure.

Underwriting

When a person inquires about signing up for a new insurance plan, insurance providers launch an underwriting process. Underwriting refers to the qualification assessment of a potential policyholder. An insurance company will evaluate your health risks before qualifying you for an insurance plan.

Insurance Agent

An insurance agent is the professional you will interact with as you set up your insurance plan. They represent the insurance provider that gives you your coverage. Everything they say is on behalf of the insurance company.

Renewal

When you reach the end of your insurance policy, you must renew your insurance plan. You can continue with the same insurance plan or renegotiate terms with your insurance provider. If you have any children during this time, you must add them to your health benefits plan.

Insured

An insured person is someone who is part of a comprehensive insurance plan. Insured policyholders have access to the medical benefits of an insurance policy.

Terms to Know When Using Your Insurance Benefits

When you enroll in an insurance plan, you may encounter some unfamiliar jargon. Below are some insurance glossary terms to understand when utilizing your group insurance benefits.

Claim

Insurance claims are vital for a business owner to understand. An insurance claim refers to the process of informing your insurance company of a medical procedure with the hopes that your insurance plan will reimburse you for the expenses. Whenever you have emergency surgery or a workplace accident, you must file a claim to your insurance provider.

Deductible

Many insurance companies have a deductible policy for policyholders. A deductible is the amount of money you must pay before your insurance benefits kick in. For example, if your plan has a $1,000 deductible, you are responsible for the first $1,000 of expenses.

Grace Period

Insurance premiums have an expiration date. Therefore, if you do not pay your premiums, your insurance provider has the right to eliminate them from your policy. However, most insurance companies give policyholders a certain period of time to pay off their premium payments if they are late making them.

Appraisal

An appraisal refers to an estimate given by an insurance professional of your property’s value. An insurance company may conduct assessments when you file a claim to ensure that they are not overpaying for your expenses. They may also appraise your property before qualifying you for an insurance plan.

Tail Coverage

Sometimes, you may file a claim after your insurance expires. As long as the incident was while you had insurance, you should receive reimbursement for the claim. Tail coverage ensures that you get money for every emergency that occurred while you were an active insurance policyholder. 

Certificate of Insurance

When an insurance company approves you for one of its plans, you will receive a certificate of insurance. This document lists the benefits included in your plan and the contract length of your policy.

You can use this certificate as proof of insurance.

Lapse

When you cannot pay the premiums for your insurance plan, the provider may drop your coverage. You may be able to recover your insurance policy when this happens. Insurance professionals refer to the gap in your policy as a lapse in coverage.

Insured Loss

A loss refers to any expense you pay due to an accident or lawsuit. When you have an emergency, you must file a claim to your insurance company. Depending on your policy, your insurance provider may cover your total loss costs.

Insurance Terms to Know When Debating Coverage Eligibility

Filing an insurance claim can be confusing. When discerning what your insurance policy covers, you must recognize the following terms.

Actual Cash Value

Depreciating assets carry less value than new acquisitions. For example, if your company provides cars for your employees, the value of your damage depends on how new the car is. A ten-year-old vehicle will have less actual cash value than a 2022 Tesla.

Depreciation

Depreciation refers to the value loss of specific properties. For example, a car is a depreciating asset. As it experiences more wear and tear, it lessens in value.

Replacement Value

You may need to replace many things, such as printers, forklifts, and desks in your office. If you damage your equipment, your insurance company may help you pay for a replacement. Some insurance companies offer full reimbursement for replacement items.

Policy Limit

Each insurance plan comes with a policy limit. This figure represents the maximum amount of money your insurance provider will pay for an expense. If you have a loss exceeding your plan’s policy limit, your insurance provider will not cover the whole cost.

Per-Occurrence Limit

Like a plan policy limit, there is a limit on the amount of money your insurance company can pay for an individual claim. After paying your deductible, your insurance company can calculate how much you owe. However, commercial property insurance plans are not subject to a per-occurrence limit.

Professional Negligence

A client may claim negligent behaviour from your business if you fail to perform adequate service. Depending on the extent of the negligence, this claim may lead to a lawsuit. Therefore, ensure that your insurance company offers legal help if you face a court case.

Tortfeasor

A tortfeasor is the party at fault for an incident or emergency. Sometimes, your company may be the tortfeasor in a legal case. Tortfeasors are liable for any damages to a party’s property.

Vicarious Liability

Vicarious liability refers to when you may be liable for property damage despite not causing the damage yourself. For example, if one of your employees injures someone or their property, your company could be legally responsible for the action. A company representative must show up to court if the case goes there.

Named Peril Policy

When you enroll in a group benefits plan, you will receive a list of expenses your insurance provider covers. Insurance professionals refer to these costs as named perils. If you have a business expense unrelated to what your insurance plan covers, you will not receive reimbursement.

Primary Policy

Some businesses have multiple insurance policies that cover similar expenses. Your primary policy provider is the company you choose to file your claims. They take precedence over your additional insurance policies.

Coinsurance

The term coinsurance has two different business meanings. First, it can refer to a clause in your commercial property insurance stating that your coverage amount must be worth at least 80% of your property’s value. Coinsurance can also refer to your business having multiple insurance plans.

Prior Acts Coverage

Prior acts coverage refers to obtaining coverage for emergencies occurring before your insurance start date. Sometimes, this clause is present in errors and omissions insurance. As long as you maintain insurance coverage, your insurance provider should cover past medical situations.

Duty to Defend

If you have a duty to defend clause in your insurance policy, your insurance provider must provide you with a defence attorney if you go to court. Even if your claim does not cover court fees, a duty to defend clause ensures that you get legal protection in your case.

Exclusion

Each insurance company has a list of expenses that it will cover for its policyholders. Exclusions refer to any situation that your insurance provider does not cover. You must know what costs your insurance plan covers before filing a claim.

Cyberextortion

Cyberextortion is a type of virtual crime where hackers compromise your business’ computers and ask for a ransom. Cybercriminals will steal your valuable data and use it as blackmail to receive a payment from your company. Therefore, investing in cyber insurance is essential for small business owners.

Qualifying Event

A qualifying event refers to any change in your business that affects your insurance eligibility. For example, if your company adds more services for its clients, you must report these to your insurance provider to get additional coverage. You will have up to two months to report any sudden business changes.

Insurance Binder

Sometimes, it may take up to a week to receive your certificate of insurance and health cards. In the meantime, your insurance provider will send you an insurance binder. This temporary document serves as proof of insurance while you wait to receive your health insurance cards.

Types of Small Business Health Insurance in Canada

Canada offers many different types of small business benefits. These policies protect you and your employees and help you save money on workplace expenses.

With many business group insurance packages to consider, it can be hard to find the best one for your company. Here are some of the different kinds of small business policies in Canada.

Business Owners Policy

A business owner’s policy is among the broadest types of business health benefits available to Canadians. It covers emergency expenses stemming from fires, suspended business, legal fees, and other costs.

Most Canadian business owners enroll in a business owners insurance policy.

Commercial Auto Insurance

If your business owns cars for company use, you need commercial auto insurance. Please note that your personal car insurance will not cover commercial driving expenses. A business auto insurance plan will cover those commercial vehicles.

Cyber Business Insurance

In 2022, cybersecurity is more vital than ever. A cyberattack can do irreparable damage to your company. Business owners can sign up for cyber insurance, providing financial assistance for revenue losses, damaged equipment, and PR expenses.

Business Liability Insurance

As a business owner, you must prepare yourself for potential lawsuits. Most businesses will deal with court and legal fees at least once. Liability insurance helps pay for defence costs if a person sues your company.

Pro Liability Insurance

Like business liability insurance, professional liability insurance protects against any errors you make in the workplace. For example, if you accidentally make a mistake designing one of your products for a client, pro liability insurance will cover the cost of a replacement. If your case goes to court, this insurance will help pay your legal fees.

Umbrella Insurance

As mentioned above, each insurance plan has a policy limit. When you have multiple insurance plans, you can invest in umbrella insurance. Umbrella insurance refers to an insurance policy covering any expenses over your other insurance plan’s policy limit.

Waiver of Subrogation

The waiver of subrogation states that neither your company nor your insurance provider can obtain a share of paid damages that a third party receives. Sometimes, insurance companies will pay claim filers before assessing the value of the damage. The waiver of subrogation ensures that insurance companies do not try to recoup money from the third party.

Workers Comp

Workers comp is one of the most common insurance policies for businesses. If your employees hurt themselves while working, workers comp insurance ensures that they do not miss out on their paychecks for the weeks they cannot work. It also pays for any medical procedures or bills the injured party has.

The Need for Insurance for Small Businesses

Small businesses need to invest in group insurance for many reasons.

Property Damage

If you have property damage, it can cost you thousands of dollars if you do not have small business health plans. Depending on the nature of your business, you may have high-end equipment that costs a fortune. Some of this equipment may be rare and hard to replace.

Damage to property, such as expensive equipment, can be enough to put a small business out of business. Small business health insurance can help pay part or all of your property damage expenses to keep your business afloat.

Liability

Another reason business owners invest in group benefits plans is to mitigate the risk involved with their services. For example, if you own an HVAC company and damage one of your client’s properties while installing an air conditioner, you are at risk of a lawsuit. However, if you have liability insurance, your insurance provider may pay for repair costs to help you avoid court.

Also, it is common for businesses to deal with lawsuits. A lawsuit can put your company out of business through excessive legal fees. Many insurance providers include coverage for court fees in their policies.

FAQs

Below are some answers to the most frequent questions we receive from our customers.

Who Gets Coverage in a Group Insurance Package?

You must provide health benefits to all your employees. You cannot pick and choose workers to receive benefits. However, you do not have to provide health insurance to part-time employees or those who work less than thirty hours a week.

Please note that you cannot discriminate based on your employee’s medical history. If one of your workers has preexisting conditions, you must still provide them with health benefits.

Employers have the option of declining your group benefits package. However, there is a minimum number of employees that you need to sign up for a group benefits plan.

When an employee retires, they are no longer eligible for your group benefits plan. These health insurance policies are only for active employees.

How Do I Sign Up for a Group Benefits Plan?

If you are interested in a small business health insurance plan, you can fill out our quote form to help you compare the best insurance policies in Canada. Once you sign the form, we will call you to discuss your insurance needs. 

With that information, we will reach out to our network of insurance providers, gathering quotes for your review. We will then email you your most competitive quotes.

Then, you will contact the insurance provider and apply for coverage through their website. You must give the insurance company information about all the employees you want to enroll in the group benefits policy. Once they accept your application, you will receive a letter informing you of your coverage start date.

Get Business Benefits Quotes Today

We work with some of the best insurance suppliers in Canada, including Sun Life and Manulife. Our team wants to help you and your employees get the best group insurance package available. With a comprehensive group benefits plan, you will no longer worry about equipment damage, legal fees, or commercial car accidents.

If you have any questions about our insurance glossary, email us at [email protected]. Also, you can visit our office at 10 Great Gulf Drive, Unit 5, Vaughan, ON, L4K 5W1.

You are one step away from comparing Canada’s best insurance quotes. Get quotes from some of the best insurance companies in Canada by filling out our brief quote form.