Do I need to cancel my private health insurance before leaving?

When Canadians plan a long stay abroad — whether for study, work, emigration, or winter “snow birding” — it is very important to decide what to do with their private health insurance. Unlike provincial health plans, which automatically expire after a certain period of absence, private insurance is subject to the terms of the contract. This article covers all the aspects you need to be aware of to protect yourself from unexpected expenses and prevent your coverage from being canceled or suspended.

How private health insurance differs from provincial insurance

Private companies sell policies with varying levels of coverage, from basic emergency care to comprehensive coverage that includes hospitalization, medical evacuation, repatriation, and coverage for pre-existing conditions. Their terms are much more flexible than provincial ones, but they are often limited by the duration and territory of the contract. Most policies have clearly defined rules for traveling outside the country: a vacation trip of 30–60 days and a prolonged absence of more than six months or a year may require separate approval from the insurer.

When you don't need to cancel your policy

Short trips

Most annual private travel insurance policies automatically include coverage in the main country of insurance and abroad up to a certain number of days (often 60–90 days). If your policy provides this, you do not need to cancel it before a short vacation; simply notify your provider of your travel dates and keep their emergency contact details handy.

“Long adventure” policies

Some insurance products are designed specifically for snowbirds and travelers who are away for long periods of time. They are valid for one year and do not need to be interrupted, even if you spend six months abroad. The main condition here is to maintain regular payments and inform the company of any change of address or contact details.

Policies without territorial restrictions

There are private insurers that offer “global” policies without strict territorial restrictions. Even if you move to another country for a longer period, these contracts remain valid provided that you pay your premiums regularly and have valid medical status.

In these three cases, canceling the policy is not only unnecessary but also undesirable: it is quite difficult to renew a lost contract, and purchasing a new one may be more expensive or unavailable due to age or pre-existing conditions.

When is it necessary to cancel a policy?

Emigration

If you decide to leave Canada permanently, most insurance companies will cancel your policy or convert it to another form (expatriate insurance). Policies issued to Canadian residents usually become invalid as soon as you become a non-resident.

Moving to a country with different insurance

When you obtain public or private medical coverage in your new country, it usually makes no sense to continue paying for your Canadian policy. Most contracts provide for automatic cancellation or transfer to another plan upon presentation of proof of new residency and purchase of local insurance.

Failure to comply with the terms of the contract

If your absence exceeds the limit of days without prior approval, your policy may be suspended or canceled. In this case, it is advisable to initiate the official termination of the contract yourself to avoid debt claims for unpaid premiums or penalties.

Change in health status

Some private policies require notification and review of the terms and conditions in the event of a significant change in health or treatment. If new medical circumstances make you an unprofitable customer, the insurer may require early cancellation or transfer of the contract to more individual terms.

How to cancel a policy correctly

Check the terms of the contract

Carefully read the section on policy termination: terms, forms, possible penalties, and rules for refunding part of the premium. Keep a copy of all relevant pages.

Written notification

Unlike email, official correspondence should be sent by registered mail with confirmation of receipt. Include:

• Policy number
• Date and reason for cancellation
• Request for final premium calculation and possible refund

Personal call and electronic confirmation

Call customer service to make sure your letter has been received. Ask the operator for a reference number and confirmation of the processing time.

Document the entire process

Keep copies of letters, screenshots of electronic confirmations, and records of telephone conversations with the date, time, and name of the employee. This will be useful in case of disputes.

Verify cancellation

After a few weeks, ask your insurer for official confirmation that the policy has been canceled and for a final premium statement.

Alternatives to cancellation

Suspend coverage

Some companies offer the option to “pause” your policy for a certain period of time. This is useful if you plan to return to Canada in a few months or years.

Transfer to an “expatriate” plan

If you are leaving Canada permanently but want to stay in touch with your insurer, find out about international insurance options that will cover you in your new country.

Modification of the contract

Instead of canceling your policy, you can switch to a smaller package, which will reduce the cost but maintain basic coverage when traveling to Canada.

Financial and tax implications

Premium refund

Many policies provide for a pro-rata refund of unused premiums. Carefully check the deadlines and possible deductions for preparing the documentation.

Taxes

If you cancel life insurance or health insurance with a cash component, there may be tax consequences if the payments exceed certain amounts. Consult with your accountant.

Possibility of investing funds

The released funds can be invested in an international medical fund or other financial product that will provide coverage abroad.

Conclusions

Whether you need to cancel your private medical insurance before leaving Canada depends on the length and purpose of your absence, the terms of your contract, and your plans for returning.

If you are leaving the country permanently or plan to stay abroad beyond the coverage period without the option of a “pause” or policy transfer, then yes, you need to. For short-term trips or if there is a suspension option, it is best to keep the policy and notify the company of your plans in a timely manner.

The main thing is to carefully read the terms of the contract, submit a written request for cancellation or adjustment, document the entire process, and consult with tax or insurance specialists. The right approach will ensure that you avoid unexpected financial expenses and provide maximum protection for your interests while you are outside Canada.