So what is the key differences between Workers’ Compensation insurance and what our disability plans can offer as an alternative. The Ontario industry often refers to this as "WSIB Alternative Insurance." There are some important differences between the policies that should be noted:
PREMIUM CALCULATION: Premiums for Workers’ Compensation policies are calculated based on gross income while benefits are calculated on net earnings. For an Owner/Operator with high operating costs this makes a substantial difference in the amount of a claim. Our alternative policies on the other hand can use the companies profits + gross income which usually results in being able to get a more representative coverage relative to your real income.
WHEN YOU’RE COVERED: Workers’ Compensation policies only cover Owner/Operator’s for accidents and injuries that occur while on the job. If an Owner/Operator were to get injured while at home or on vacation a Workers’ Compensation policy would not provide coverage. Our disability plans, however, can provide 24 hour accident protection which offers substantial peace of mind to many Owner/Operators.
PRICING: Workers’ Compensation policies tend to come at a high cost and many Owner/Operators choose to opt out based on the affordability of private coverage.
When choosing a private insurance policy it is important to review and understand the coverage you’re purchasing as there are many optional benefits available. Although purchasing the minimum amount to meet legal or contract requirements may seem like the economical option this often opens an Owner/Operator up to substantial risk. To ensure their business, family and future is protected many Owner/Operators choose to purchase additional protection with Sickness Coverage, Long Term Protection and Weekly Benefit Coverage to age 70.
It is important to remember that not every Owner/Operator is eligible to opt out of Workers’ Compensation and reviewing your contract details may be required. In order to qualify to opt out an Owner/Operator must:
- Pay for/own their truck and majority of their equipment
- Be independent (have the right to choose their contracts)
- Have a contract for service relationship with their carrier (not employer/employee)
- Not receive a T4, T4A or have statutory deductions for E.I and/or C.P.P.
- Owner/Operators that do not qualify to opt out of Workers’ Compensation often still purchase a private policy as a ‘top- up’ to their current coverage.
When purchasing any insurance it is important to work with a reputable broker which has experience working in the trucking industry. Lapointe Financial Group has been in the trucking industry for more than a decade and we're here to help and answer any questions you might have on WSIB Alternative.