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Dental and Vision Coverage through an Insurance Plan

The point of private health insurance is to insure medical expenses not typically covered by the provincial (public) health plan. These expenses often fall under the categories of dental or vision, such as a regular dental checkup or a new pair of prescription glasses. While it is important to get coverage for these items, it may not be necessary to use insurance specifically. Let’s explore why:  

Many insurance carriers offer coverage on various dental and vision costs. However, you should be wary of the fine print under their terms and conditions. Be sure to go over deductibles, co-pays, co-insurance, restrictions, and pre-existing conditions. Insurance carriers often hide complexities within these terms, which may prevent you from claiming the full (or even a partial) amount on the medical expense. Even when you are sure of your plan, things can be difficult to keep track off.

If you have prior experience with insurance, then you are also aware that claiming more than predicted can lead to an increase in premium costs. All in all, health and dental coverage can be complex under a traditional insurance plan.

Generally, there are 3 reasons to avoid traditional health insurance

  1. Complex terms, fees, and restrictions
  2. The true nature of insurance and planned maintenance
  3. No flexibility or affordable pricing options

Is there an alternative to insurance?

Meet the Health Spending Account (HSA), Canada’s best-kept secret for small business owners. An HSA has no restrictions, no co-pays, no co-insurance, no deductibles, no pre-existing conditions, and no pre-qualifying medical checkup(s). It provides the same fundamental solution as traditional health insurance. It gets the same result through cost-effective means. It works by eliminating the tax on eligible, health-related costs.

Depending on your current insurance plan fees and tax bracket, an HSA can end up saving you much more. See how much you save by using our Savings Calculator or learn by reading this case study of a typical family business.   

Differences between an HSA and traditional health insurance 

HSA vs insurance table

Although it may be more efficient to switch to an HSA altogether, you can have both an insurance plan and a Health Spending Account (HSA) in place. An insurance plan’s associated costs are eligible under an HSA. This means you pay for insurance fees using before-tax money. Simply put, an HSA can turn health-related, after-tax expenses into before-tax expenses. It does this by funneling money through your business into your personal account.

With components of tax planning, the HSA works differently depending on your company structure.

To learn more, download our FREE Beginner’s Guide for a business with NO arm’s length employees:

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If you own a business with arm’s length employees, click below instead:

The Beginner's Guide to Health Spending Accounts GROUP HSA Employee Benefits 2018