Group benefits in Canada have changed more in the past five years than in the decade before it, according to Mark Spence (pictured), vice president, group health and life insurance, Canada at Westland Benefits, who points to the pandemic as the clearest dividing line for what employees now expect from a benefits plan.
Spence said COVID reshaped what work itself looks like, forcing many organizations to confront questions about flexibility and employee wellbeing that simply weren't on the table a decade earlier. That shift, he said, has made rigid, one-size-fits-all benefits plans increasingly unworkable, since a 25-year-old employee in downtown Toronto and a 56-year-old employee in Regina have fundamentally different needs.
"Having rigid program designs doesn't work," Spence said. "People want choice."
The cost of delivering a comprehensive benefits plan in Canada has become a serious budget line for employers of any size, Spence said, typically running anywhere from roughly $2,500 to $4,000 per employee annually depending on how extensive the coverage is, excluding retirement matching or other savings tools. For a company with just ten employees, he said, that adds up to a minimum of $25,000 a year in health benefits spending alone, a number that scales quickly and demands real justification from employers.
Despite that cost, Spence said the calculation for most employers is straightforward: without healthy, engaged employees, a company's core business simply doesn't function.
Asked where employers are feeling the most cost pressure right now, Spence didn't hesitate.
"It's always drugs," Spence said. "Drugs rarely get cheaper in the short term."
Disability costs have also become a major strain, he said, compounded by a persistent shortage of mental health and other practitioners across Canada. Even as virtual care has expanded access in theory, Spence cautioned that not every employee actually benefits from that shift, since a meaningful share of the working population still lacks reliable access to the technology or comfort level needed to use virtual options effectively.
"Not everybody has access to technology or instant comfort with new modalities," Spence said. "It's not like that for the entire working population that are covered by benefit plans."
The rise of GLP-1 drugs, including semaglutide medications originally developed for diabetes, has added a new layer of cost pressure that plans are still adjusting to, Spence said, given how quickly demand for these treatments grew once their weight-loss effects became widely known.
To help employers manage rising costs without simply stripping coverage, Spence said brokers are increasingly steering clients toward alternate funding models, things like administrative-services-only arrangements, partial self-funding, or expanded healthcare spending accounts, that preserve choice for employees while giving employers more predictable costs.
"Employers like that conversation because you're not stripping out choice, you're just looking at alternative ways to do things," Spence said. "How do we give you enough things for the benefit spend you're doing that's perceived really well by your employees, but also gives you at least some stability?"
Among the coverage categories that have shifted dramatically in recent years, Spence pointed to women's health as a clear example of how quickly employer priorities can change once employees start speaking up.
"Menopause was not necessarily a mainstream topic five years ago," Spence said. "Now every single carrier has made it a priority, but it took some first followers to take charge on the issue."
That same dynamic, Spence said, is likely to play out with men's health next, particularly in male-dominated industries like construction, where he previously worked closely with employers on this exact issue before joining Westland.
He described a workforce that tends to be stoic and reluctant to ask for help, in a sector already grappling with some of the highest suicide and mental health crisis rates of any industry, a combination of sector-specific and demographic pressures he expects will eventually demand the same kind of attention.
Predicting the next major shift in group benefits is difficult, Spence said, since the most significant changes of the past few years, from menopause coverage to GLP-1 drug demand, weren't widely anticipated by the industry until employee demand made them impossible to ignore. What's clear, he said, is that technology alone won't replace the value of direct human guidance in navigating health and financial decisions.
"I don't think you can remove the human element of all the different things in health," Spence said. "Good advice still matters, whether it's from a doctor, a financial advisor, or a broker."
Above all, Spence said the strongest predictor of a healthy client relationship in this industry is consistent communication, since problems in a benefits plan are rarely the real issue. How quickly and transparently they're addressed is what actually matters to employers.
"If you communicate with your client sponsor on a regular basis, and they're not surprised, they're usually willing to ride the highs and lows," Spence said. "The number of times we've won business from people saying, 'I'd never hear from my broker,' it's wild."
