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Posted by Louise Gagne, FICA, FSA, May 8 2019
Management & HR
Employees With Work Permits: How To Cover Them Adequately


The manpower shortage is being felt across the labour market. Consequently, an increasing number of workers from abroad are coming to Canada with all kinds of working permits. Can these employees benefit from the same insurance coverage as Canadian residents? Not necessarily… Read this article to learn more about about this topic.

Types of Work permits for employees

There are different types of work permits for employees. Holders of open permits are allowed to work for more than one employer during their stay in Canada, whereas holders of closed permits are attached to a single employer. Whether the employee work permit is open or closed, authorizations to stay and work in Canada are temporary and can be renewed or not, depending on the country of origin.

RAMQ coverage

In general, holders of closed permits are eligible for RAMQ coverage, under certain conditions and upon request. Holders of open permits are not entitled to such coverage, unless they are awaiting their permanent resident status and have a permanent job.

To ensure these workers are well covered, they are normally required to take out a valid health/hospitalization/repatriation insurance for the duration of their stay. This will replace RAMQ coverage and ensure the payment of repatriation costs to their home countries if necessary.

Workers who hold such an individual insurance, which is quite expensive, often refuse the insurance coverage offered by their employer, claiming they are already insured. But is this really the case and can they refuse to enroll in their employer’s plan?

Impact on your insurance

Before you determine what coverage can be offered to these workers, you need to check your policy’s eligibility conditions to ascertain whether your plan members must be covered under a provincial health insurance plan. Such a requirement would make it impossible for you to provide any insurance whatsoever to employees who are not covered under RAMQ (or another provincial plan if you operate in another province).

If this condition is not required and employees with a working permit are eligible to enroll in your plan, the individual coverage they purchased does not exempt them from the obligation to join your group plan as their individual insurance only replaces what is normally covered by RAMQ. Your employer plan will cover other health care expenses, as is the case with any other employee. Unless you add a class of employees “with temporary working permits” who are excluded from the plan, all employees in this situation must be insured.

IMPORTANT: Exclusion for travel insurance and wage loss replacement insurance

It is important to note that, even when coverage under a provincial health insurance plan is not required for enrolment in your plan, travel insurance is seldom included for individuals without provincial coverage.

Also, many insurers refuse to provide wage loss replacement coverage to such employees, the rationale being that they are only in Canada for a limited period and they will most probably return to their home country should they become disabled and unable to work for several months.

If you have employees with a work permit and you do not know if their status is correct with respect to your insurance contract, you can contact your AGA advisor who will help you figure it out.


Louise started her career at Blue Cross before working as a Senior Advisor for a large actuarial firm for more than 15 years. Fellow of the Canadian Institute of Actuaries, Louise joined AGA in June 2014. She assumes responsibility for training, provides technical support, and supplies advisory activities for the large business clientele. Louise is also lecturer at l’UQAM.
Louise Gagne, FICA, FSA