What is the Difference between Commercial and Private Health Insurance

October 19, 2023

Selecting the right insurance policy is very important as it affects your welfare and financial security. While looking at your options, you will find words like “commercial” or “private” health insurance. To make a good choice, it is necessary to understand the difference between them. This comprehensive guide brought to you by SummitCover, Canada’s premier insurance provider, will discuss “What is the difference between commercial and private health insurance”. This guide will move readers from the basics to help them understand coverage and costs as they choose a plan that suits their needs.

Understanding Health Insurance Options

Before discussing the difference between commercial and private health insurance, we must know what these terms mean. But before that clear your basics by reading our post on what is health insurance and how it works!

- Commercial Health Insurance

This type of insurance is provided by private entities for businesses or organizations. It includes many benefits, including 

  • Preventive care
  • Hospitalization
  • Prescribed drugs 

It also offers a range of other benefits for groups of employees and their families. In most cases, the cost of the premium is shared between the employer and employees, thus making it a cost-effective policy for many.

- Private Health Insurance

This type of coverage can be directly purchased by an individual or a family from an insurance provider. They are specific to the demands of the policyholders and provide extensive coverage and benefits that are adapted according to the requirements of each individual. Policyholders may customize their policies and choose the extent to which they would wish their plan should benefit them according to their concerns.

If you run a small business in Canada, you should also know about small business health insurance Canada

Coverage Differences: What Each Type Offers

- Commercial Health Insurance

With its plans, you will be assured that you are covered for numerous medical services when you enroll. As for their benefits, these include 

  • inpatient hospital care
  • outpatient physician visits
  • preventive care
  • prescription of drugs
  • specialist consultations
  • Dental, vision and mental health services

The plans allow comprehensive coverage and guarantee that the care is available at all times.

- Private Health Insurance

There are numerous options offered under this policy that cater to different preferences. 

  • Basic plans offer the most basic services, such as doctors’ visits and hospitalization fees
  • Comprehensive plans go a notch further to include extras such as dental care, vision coverage, alternate therapy, and wellness programs. 

There are so many choices, which is why you need to look deeply into your requirements and make a decision in favour of one that provides proper coverage. And if you are planning to visit Canada, before that you should have knowledge about health insurance for visitors in Canada!

Cost Factors: Understanding Premiums and Deductibles

- Premiums

These include recurrent premiums paid to the insurer to keep the cover in place. Here, most commercial policy premiums are usually divided between an employer and an employee. The cost of the private plan will vary depending on the coverage provided by a selected plan, an individual’s age and many more factors.

- Deductibles

This is an amount that a policyholder must pay initially before insurance takes effect. Normally, high deductible plans come with low premiums while low deductible plans have high premiums.

Benefits of Commercial Health Insurance

  • Group Benefits: However, one of the ways in which companies benefit from this policy is through providing group benefits to the employees. In addition, the advantages extend beyond basic healthcare insurance, dental, and vision options, which are also important in keeping and attracting employees.
  • Cost Sharing: In many instances, companies bear a great part of the expenses associated with private covers that help ease the burden on their workers.
  • Comprehensive Coverage: This policy provides a lot in the way of coverage, and it is comforting for family members as well as employees. These plans can provide for an array of medical services and treatments that offer a comprehensive defence against unforeseen healthcare costs.

Why Consider Commercial Health Insurance?

After knowing “What is the difference between commercial and private health insurance”, you should know why commercial health insurance is considered.

  • Employer Support: Employed individuals may be offered this policy as a benefit by their employer. This will greatly reduce your additional expenses.
  • Comprehensive Coverage: The majority of the plans are packaged with full coverage covering basic healthcare services, as well as other goodies like dental and vision care.
  • Convenience: Most plans have an elaborate network of healthcare providers that makes it very easy for subscribers to access medical services, especially specialized medical care.

SummitCover: The Right Pathway for You

What is the difference between commercial and private health insurance - At SummitCover, as a company, we grasp the significance of finding the best health insurance coverage for your particular demographic. Selection between them requires an evaluation of your particular demands, financial constraints, and social life. Utilizing the group benefits and cost-sharing opportunities available in commercial health insurance can be a good idea if you belong to an organization that offers one. Think hard before opting for a private policy if you are self-employed or your firm does not offer healthcare coverage. 


Consider the coverage, premiums, deductibles, and additional benefits, and then choose the most suitable plan. Our highly experienced team can assist you. Come for a visit to find the best healthcare plans that will ensure your health and peace of mind. With SummitCover you are free to make the right choice for you and your family to have a secure and healthy future!

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