Group Insurance in Canada: Understanding the Cost Plus Reimbursement

Posted on January 16, 2012 and updated January 31, 2012 in Group Benefits, Insurance Types, Life Insurance Canada News 2 min read

Cost Plus is an option that is added to many group insurance policies in Canada. The option provides the employer the opportunity to deduct health or dental expenses that exceed coverage limits outlined in their group insurance plan.

It should be noted, though, that the expenses must be covered under the Income Tax Act for the expense to be deducted.

Deductible expenses, or some of the expenses that could be reimbursed by cost plus, include prescription drug amounts and dental amounts that exceed benefit maximums. In addition, deductibles and co-insurance amounts can also be reimbursed by Cost Plus.

Cost plus offers many advantages to the employer:

1. Benefits are not tax income to the plan member.

2. Premiums are deductible as a business expense.

3. Claims paid are not charged to the experience of the plan. This can be a significant benefit for companies trying to keep their group insurance premiums intact.

4. It pays for medical, prescription, and paramedical services not covered under your group plan.

For more details on how cost plus reimbursement can benefit your company, please contact us a 1-866-899-4849 or visit our Group Benefits Online Quote Page.

avatar
Jacquelynn
Jacquelynn

Fantastic ideas ! I was enlightened by the information – Does anyone know where I might be able to get access to a template CG 20 37 form to type on ?

LSM Insurance
LSM Insurance

Thanks unfortunately I’m not sure where you’d find that form.

The Sales Quadrant
The Sales Quadrant

Can you cover a sales agency with several part time workers. They will be full tiem soon.

LSM Insurance
LSM Insurance

Thanks – it depends on the size of your company, how long you have been in business, if you have group insurance now and the claims experience. We are happy to try and help and will be in touch by email.