Canadian Life and Health Insurance Association Inc.

Retirement Savings

retirementCanada's retirement savings system is structurally sound, but not perfect. It is a foundation upon which to build. The life and health insurance industry believes that there are a number of areas in which governments can stimulate greater retirement savings by Canadians. Reaching that goal will require a combination of education, incentives and legislative changes, within a framework where Canadians can choose among competing service providers and savings vehicles.
The industry supports Pooled Retirement Pension Plans (PRPPs) which have been introduced in several jurisdictions. PRPPs (also known as VRSPs in Quebec) will make it easier and cheaper for employers to offer a retirement savings program for employees. It reduces administrative work and will be especially attractive to small and medium-sized employers. By relieving the employer of almost all administrative costs and compliance issues except for payroll deduction processing, more companies, their employees and the self-employed can participate.
Canada’s life and health insurance industry plays a key role in helping Canadians prepare for retirement not only through workplace plans, but also through the advice, and savings and lifetime income solutions, delivered by the thousands of financial advisors who serve Canadians every day in communities from coast to coast. The industry is ready to play its role in supporting governments, businesses and individuals in advancing the retirement savings system in a distinctly Canadian way: inclusive, practical and affordable.


  Saving More for the Future: An Achievable Goal for Canadians
CLHIA Policy Paper
CLHIA's recommendations to improve the use of workplace retirement savings plans.

Pooled Registered Pension Plans (PRPPs)

retirementFederal, provincial and territorial governments have all committed to the introduction of Pooled Registered Pension Plans (PRPPs), to fill a gap for the more than 60 per cent of Canadian workers who don't have access to such workplace retirement plans. PRPPs are pooled, low-cost, professionally-managed pension plans.

"Under PRPPs, all working Canadians can benefit," says Frank Swedlove, President of the Canadian Life and Health Insurance Association (CLHIA). "The big winners are small and medium sized businesses that currently can't afford to offer pension plans, as well as those private sector workers and the self-employed who don't have access to such plans," he added. A survey that CLHIA conducted found that 7 in 10 small and mid-sized business executives are interested in offering a PRPP.

The federal government and six provinces have passed PRPP (or, in the case of Quebec, VRSP) legislation. Quebec has gone one step further and requires that all Quebec workers in workplaces with five or more employees, along with the self-employed, have access to a workplace retirement savings plan.

The CLHIA urges other provinces to move forward on a timely basis, to ensure that millions of Canadians can benefit.

December 2012