Small business insurance

Small business insurance in Canada, without the guesswork

The coverage a small team actually needs — group benefits, Health Spending Accounts, and key person protection — with real cost benchmarks. Compare quotes from licensed brokers across the major Canadian carriers.

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What small business insurance covers

"Small business insurance" isn't one product — it's the handful of coverages a growing Canadian business uses to protect its people and itself. Most owners start with one or two of these and add the rest as the team grows:

Group health & dental

Prescription drugs, paramedical, vision, and dental for your team — the benefits employees notice and value most. Available from two employees up.

Group life & disability

Group life (often 1–2× salary) plus short- and long-term disability. Inexpensive per head and a baseline expectation for many hires.

Health Spending Account (HSA)

A tax-deductible pool of money for health and dental costs, with no premiums or claims hassle. Often the most efficient route for owner-only or very small operations.

Key person insurance

A business-owned policy that pays the company a tax-free lump sum if a founder, partner, or critical employee dies or becomes disabled.

What it costs for a real-sized business

For group benefits, a balanced plan covering health, dental, group life, and short-term disability typically runs $90 to $180 per employee per month, usually shared 50/50 to 70/30 between employer and employee. The employer's portion is a deductible business expense. A Health Spending Account, by contrast, costs only what you choose to fund into it plus a small administration fee — which is why it's often the right first step for very small teams.

Under roughly ten employees, packaged small-business plans are usually cheaper and simpler to administer than a custom plan. Past 25 or so, custom plans tend to win on value. A licensed broker can tell you which side of that line your business is on. For the full breakdown of plan design and the bundle, see our group benefits guide.

Protecting the business, not just the team

Group benefits and HSAs protect your employees. To protect the business itself against the loss of a critical individual, key person insurance pays the company a tax-free lump sum if a founder, partner, or essential employee dies or becomes disabled — money to keep operating, recruit a replacement, or fund a buy-sell agreement. If your situation calls for a corporate-owned life policy, our guide to business life insurance covers the mechanics.

How to get started

Decide first whether you're protecting your people, the business, or both. Then compare quotes from licensed brokers who can put the same plan design across the major Canadian carriers side by side. The comparison is free and there's no obligation. Our guide to the best small business insurance in Canada breaks down what the major carriers cover and what coverage typically costs. If you also carry personal coverage, our guide on group life insurance in Canada explains how workplace life cover stacks with a personal policy.

FAQ

Small business insurance questions, answered

It depends on what you're protecting. To attract and keep staff, most small businesses start with group benefits — health, dental, group life, and disability. To protect the business against losing a critical individual, key person insurance pays the company a lump sum. Owner-only operations often begin with a Health Spending Account, which is the most tax-efficient way to fund health and dental costs before a full group plan makes sense.

For group benefits, a useful benchmark for a balanced plan (health, dental, group life, short-term disability) is roughly $90 to $180 per employee per month, usually split 50/50 to 70/30 between employer and employee. A Health Spending Account costs only what you fund into it plus a small administration fee. The right number depends on your team's age, your industry, and the richness of the plan.

Group plans are generally available from two employees and up. Below that, a Health Spending Account or an individual health plan is usually the better fit. For teams of two to five, packaged small-business plans tend to be cheaper and simpler than fully customized group plans; past 25 or so employees, custom plans usually deliver more value.

For very small businesses of one to five people, often yes. An HSA gives owners and employees a tax-deductible pool of money for health and dental expenses, with no premiums and no claims back-and-forth. Past about ten people, a traditional group plan usually delivers more value because it spreads risk across a larger group.

The employer's share of group health, dental, and disability premiums is generally a deductible business expense, and HSA contributions are deductible too. Employer-paid group life premiums are deductible but create a small taxable benefit on the employee's T4. Tax treatment varies by coverage type — confirm specifics with your accountant.

Decide whether you're protecting your people (group benefits or an HSA), the business itself (key person insurance), or both. Then compare quotes from licensed brokers who can quote the same plan design across the major Canadian carriers and tell you which side of the small-group versus custom-plan line your business falls on. The comparison is free and there's no obligation to buy.

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