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Employment Insurance (EI) for involuntary job loss

You could get Employment Insurance (EI) if you can't work or are dismissed without fault.

We’ll continue updating this page with resources and information as new details emerge on how Canadian leaders and businesses are responding to COVID-19.

Involuntary unemployment happens when you lose your job because of an economic downturn, the end of seasonal work, your company downsizing, your job being made redundant or other reasons for which you’re not at fault. It does not include resigning from your job, selling your business or being let go for poor performance or violating company policies.

Government Employment Insurance (EI)

This information is current as of March 24, 2020.

The government offers income support for a variety of situations through it’s EI program:

  • Caregiver benefits and leave
  • Benefits for Canadians living abroad
  • Benefits for self-employed fishers

If you lose your job or have shifts cut as a result of the coronavirus, you may qualify for EI depending on how many insurable hours you’ve worked over the past 12 months.

Insurable hours are hours for which you were paid as reported by your employer your a Record of Employment (ROE), which is submitted to the government. Because you took part of your earnings from those hours and put it into the EI program, your income from those hours helps determine what your EI payout will be.

The minimum number of insurable hours you have to work to be eligible for EI is based on the unemployment rate where you live. For example, as of March 24, 2020, if the unemployment rate in your region is 6% or less, you have to work at least 700 insurable hours to be eligible for EI. But if the unemployment rate is between 9.1% and 10%, you have to work at least 560 hours.

The maximum amount of EI you can get is 55% of your average insurable weekly earnings, up to a maximum amount. As of January 1, 2020, the maximum yearly insurable earnings amount is $54,200 (or $573 per week).

Recipients are required to file a report to the government every so often to confirm that they are looking for work and not simply using their benefits to take time off. (This reporting requirement may be waived depending on the type of benefit you’re receiving. For instance, you’re not expected to be looking for work while on sickness benefits, so you don’t have to file a report.) To learn more about EI or to apply, visit the Employment and Social Development Canada website.

How to pay your bills if you’ve lost your job

Extra help for EI applicants with coronavirus

The government is prioritizing processing EI applications for people with coronavirus. If you become infected with coronavirus and get quarantined, the usual 1-week waiting period on receiving your first EI payment will be waived. Essentially, this means you don’t have to pay a deductible and will receive an extra week’s worth of EI benefits.

You might find the following guides helpful:

Unemployment insurance from private insurers

Besides government-issued insurance, you can also look into coverage offered by private insurance providers. These policies usually allow you to receive a payout on top of what you’re already getting from the government. So, it’s great if you want to increase your EI coverage.

If you’re self-employed, you can choose not to join the EI program simply by not paying into it. But you’ll be hard-pressed to find private insurance that offers the same coverage for a comparable price. The trade-off for relying solely on EI is that, once you cash in on the maximum amount of EI for which you’re eligible, you have to work and build up insurable hours again before you can receive another payout. Private coverage tends to be less restrictive in its payout policies.

What type of private insurance can I get for unemployment?

Private insurers in Canada break down the components of the EI program into separate policies, so you’ll have to pay multiple premiums to get a full suite of unemployment insurance. But if you decide you only need some, and not all, types of coverage, you can save on premiums. Here are some of the more common types of unemployment-related insurance that private companies offer:

Critical illness insurance.

Covers you if you can’t work due to a severe illness like cancer, heart attack and stroke. Providers vary in what medical conditions they cover and even in how those medical conditions are defined. Theoretically, if your doctor declares that you had a heart attack, but your symptoms and condition don’t fully line up with the definition of a heart attack as stated in your policy, then you could be denied coverage. Insurance companies do this to make sure payouts are for legitimate reasons. Policy details are usually decided in consultation with experienced medical professionals.

Critical illness insurance

Disability insurance (which may also cover sickness).

Covers you if you can’t work due to sickness or disability, both visible and non-visible. You may be able to get coverage to supplement the loss of your regular income or even your retirement income, depending on the insurance provider.

Disability insurance

Accidental death and dismemberment (ADD)

Provides a payout if you lose an eligible part of your body or body function. If you die, your beneficiaries will receive a payout instead. Eligible bodily losses vary between insurers but could include limbs, eyesight, fingers, toes, hearing and the ability to communicate audibly. Losses (including death) must occur through an accident. So, you won’t get ADD coverage for natural hearing loss or dying from cancer, but you could be covered if you die in a car accident or lose a finger while operating machinery.

ADD insurance while traveling

Unemployment insurance for debt repayments

When you get a credit card, line of credit, personal loan, mortgage or some other form of debt, you may be offered insurance to cover debt repayments in the event you lose your job, get a serious illness or become disabled. This costs extra on top of your regular debt repayments, but it can provide peace of mind so you have one less thing to worry about should your source of income get cut off.

Additionally, lenders may offer insurance to write off your debt should you pass away before it has been repaid. Once again, this costs extra, but it can be beneficial to relieve your cosigners (if you have any) from having to pay back your debts after you die. It can also be beneficial for the beneficiaries of your estate, as they usually receive inherited assets less any amount needed to payoff your debts.

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