A move is usually timed to your renewal date, and your contract sets the notice you must give. Check it before you commit, and have the new plan start the day the old one ends.
Moving an Existing Plan
Switching Group Benefits Providers
Moving your plan can make sense, but premium is only part of the decision. Here is how renewals work, what to compare, when to start, and what happens to your employees.
When to Move
When does it make sense to change providers?
When an increase can't be explained or negotiated, service has slipped, or the plan no longer fits your team. A small premium difference alone is rarely enough, since every move takes work.
Changing provider also isn't the only option. At renewal you can negotiate with your current carrier, compare others or change the plan design, and sometimes staying put is the right answer. Our renewal review starts with what's driving the increase.
Worth a closer look
- Repeated increasesEspecially if nobody can explain them
- Slipping serviceSlow claims, billing errors or poor support
- A changed teamThe design no longer fits your size, ages or needs
- Little room to moveFew options offered at renewal
Renewals
How do renewals and renewal increases work?
At renewal the insurer re-prices the plan for the next period and sends a package showing the rate change. Health and dental renewals often reflect what the group claimed, adjusted for several other factors.
Ask how the increase was calculated, then weigh it against what drives group benefits cost.
Claims experience
What your group claimed, to the extent the insurer considers it credible. Benefits such as life and long term disability are usually pooled instead.
Trend
An allowance for expected increases in the cost and use of care.
Pooling charges
The cost of sharing large claims across many employers, based on the pool's results rather than only yours.
Demographics and expenses
Changes in your team's make-up, plus the insurer's own costs.
Comparing Providers
What should you compare beyond premium?
A lower premium can hide weaker coverage or a larger increase later. Compare these line by line.
| Area | What to ask |
|---|---|
| Coverage wording | Are definitions, such as disability, the same? Are there new limits or exclusions? |
| Rate hold | How long are the new rates held, and what could change them? |
| Renewal method | How will future renewals be calculated? What are the pooling levels and charges? |
| No-evidence limits | Do they match the current plan, so nobody loses coverage or has to provide evidence? |
| Amounts used this year | How are claims already paid this benefit year treated under the new maximums? |
| Eligibility | Do waiting periods, employee classes or participation rules change? |
| Service | How are claims submitted and paid, and who helps you run the plan? |
Timing
When should you start?
Start early. Send us your renewal notice and plan booklet, ideally about 60 days before the renewal date, so you can compare without rushing.
Gather the details
Your renewal notice, plan booklet and, where available, the group's claims experience.
Compare and adjust
Negotiate with your current carrier, compare others or change the plan design.
Give notice
Check the notice your contract requires, and confirm the end date in writing.
Implement
Match the new start date to the old end date, then handle employee booklets and enrolment.
Employees and Continuity
What happens to employees and their coverage?
Most employees should see a new insurer, a new booklet and a new way to claim. Guideline G3 of the Canadian Life and Health Insurance Association (CLHIA) says a plan member should be protected from loss of insurance solely because the employer changed insurers, or because they weren't actively at work at the time.
- Moving across: people insured under the old contract who are eligible under the new one should be insured under it, where the new contract starts within 31 days of the old one ending.
- Amounts: coverage should be the lesser of the old amount and what the new contract allows.
- Not at work: someone not actively at work on the switch date shouldn't be ineligible for that reason alone.
- Disability under way: if an employee is off because of accident or sickness when the old contract ends, the old insurer should consider the disability claim as if the contract had stayed in force, provided notice of claim is given within 180 days of the disability starting, or any longer period allowed. Life waiver of premium claims work in a similar way.
- Travel emergencies: these stay with the insurer in force on the date of the emergency.
The limits of Guideline G3
G3 is an industry guideline that member insurers are expected to adopt, not a law. It doesn't cover changes you agree to in the plan design. A new insurer can require evidence of insurability, and the new contract can differ from the old one, so some loss of coverage is still possible. Before you give notice, confirm in writing how employees on leave or on claim will be handled, and how claims from before the switch should be submitted.
Is It Right for You
Who should consider a move, and who should wait?
A review doesn't commit you to moving. It tells you whether a move is worth it.
A review fits
- Employers with a renewal nobody can explain
- Teams that have outgrown a first small-group plan
- Owners unhappy with service or claims handling
It may be wiser to wait or stay
- Someone is on leave or on claim, and you haven't confirmed how the move will be handled
- The saving comes from weaker coverage
- The renewal date is too close to compare properly
Common Questions
Questions about switching group benefits
They shouldn't lose coverage solely because you changed insurers. CLHIA Guideline G3 says eligible people should move to the new contract, generally at the lesser of their old amount and what the new contract allows. Changes you agree to in the plan design still apply.
Under Guideline G3, a disability claim for someone off work when the old contract ends should be considered by the old insurer as if the contract had stayed in force, if notice of claim is given within 180 days of the disability starting, or any longer period allowed.
Often not for amounts already insured, but Guideline G3 lets a new insurer require evidence of insurability before it issues a contract. Confirm this in writing before you give notice.
Send us your renewal notice and plan booklet, ideally about 60 days before the renewal date. That leaves time to compare and to meet your contract's notice requirement.
Not on its own. Compare coverage wording, how long rates are held and how future renewals will be calculated. A low first-year rate may not hold at the next renewal.
We work with clients across Burlington, Oakville, Milton, Mississauga and Hamilton. Many first conversations start with a call to 289.339.8100.
This information is general in nature and is not tax, legal, accounting, insurance or investment advice. It is based on current Canadian tax legislation, which can change. Any strategy should be designed and reviewed with your accountant and legal advisors based on your circumstances. Renewal terms, notice periods, evidence requirements and coverage vary by insurer and contract; the group contract governs.
Group benefits reviews in Burlington, Oakville, Milton, Mississauga and Hamilton
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