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Case 9 - Group Benefits (6 Marks)
This questions addresses; Medical Coverage, Life Insurance & Wage Loss
Replacement Plans / Income Maintenance Insurance Plans from Lesson 2.
Emily's employer offers coverage under a Group Health Services Plan for
Medical, Dental & Vision and some additional Insurance Benefits from Sun
Life Assurance as follows;
Life Insurance, Accidental Death & Dismemberment and Short Long-Term
Disability Insurance. The STD (short-term disability) plan is in place
specifically for cases of illness or disability, for a period of time less than 3
months. The LTD (long-term disability) plan is in place specifically for
cases of illness or disability, for an extended length of time, which would
limit an employee's ability to go back to work within three months.
Required:
a) Which benefit(s) in this overall package are NOT taxable to
employees, if offered as a group plan?
b) Which benefit(s) in this overall package are taxable, even if offered as
a group plan?
c) With regard to the disability insurance coverage,
To ensure any potential disability income from the insurance company is not
personally taxable to Emily, should she ever require it, (ie, if a claim was
made on the policy), what should she and her employer consider?

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