Record payouts made by Canada’s life and health insurers

As Canadian households struggled with the sudden escalation of the cost of living in 2022, the life and health insurance sector helped make life a little more affordable.

A record $114 billion in benefits from life and health insurance products was paid out last year, a 10% increase compared to 2019 including payments for health insurance claims, life insurance and insurance-based retirement products.

The 2023 edition of Canadian Life & Health Insurance Facts has just been published by the Canadian Life and Health Insurance Association and reveals that 74% of Canadians had health insurance coverage last year, a total of 29 million people.

That means that almost 2 million more people than a decade ago had health coverage in 2023 and it was the first time ever that there were more than 27 million covered.

Workplace health plans saw an additional 600,000 people enrol as employment picked up post-pandemic.

The largest share of payouts was for claims for supplementary health, disability, and accident coverage – up 8% to a record $43.9 billion - followed by prescription drug claims which also rose 8% to $14.3 billion.

The industry also paid $650 million in mental health support claims, representing a 10% increase, and doubling the level paid out in 2019.

Life insurance

For life insurance, 22 million people had coverage and claims were up 12%.

Nine million Canadians had retirement solutions provided by insurers and payouts totalled more than $53 billion in retirement benefits.

“During a year when many households faced higher prices and tough choices, over 29 million enjoyed the added financial protection that these products offer,” Stephen Frank, president and CEO of the Canadian Life and Health Insurance Association said. “These families had prescriptions that were more accessible, retirement that was more secure and greater certainty that financial support would be available for their loved ones.”