Employee wellbeing in Canada hits new low as costs rise, RBC Insurance finds | Insurance Business
Employee wellbeing in Canada hits new low as costs rise, RBC Insurance finds
Wellbeing decline lands amid record $143.3 billion in Canadian group benefits claims
Insurance News
Jul 14, 2026
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Employee wellbeing in Canada has deteriorated across every major measure over the past year, according to a new RBC Insurance survey, with younger workers experiencing the steepest declines
Overall wellbeing rated as excellent or good fell to 56% in 2026 from 65% in 2025, while mental, physical and financial wellbeing also weakened
The survey found mental health ratings dropped seven percentage points to 52%, physical health fell six points to 53%, and financial health slipped two points to 42%
The largest declines were among workers aged 18 to 34, whose overall wellbeing score fell 18 percentage points to 49% from 67%. Mental health among the group dropped 14 points to 42% from 56%. Older employees were also affected, with workers aged 55 to 65 reporting an eight-point decline in overall wellbeing and an 11-point drop in mental health
Despite the broader decline, employees with access to group benefits were more likely to report stronger overall, mental, physical and financial wellbeing than those without access. They were also significantly more likely to say their workplace culture supports their health and wellbeing (64% versus 46%). While the findings show a strong association between benefits access and higher wellbeing, the survey does not establish that benefits alone caused the difference
Tony Bruin, head of Group Benefits at RBC Insurance, said Canadians continue to face mounting pressures after several challenging years, but employers that make benefits both available and easy to use are seeing better outcomes
Cost of living remains the biggest barrier
The rising cost of living was cited by 51% of respondents as the biggest obstacle to investing in their health, increasing to 60% among employees with disabilities
Physical fitness (57%), diet and nutrition (48%) and sleep quality (47%) were the areas Canadians most wanted to improve. However, respondents said sleep quality (66%), physical fitness (55%) and financial security (54%) had the greatest impact on their overall wellbeing
RBC said employers can better support employees by tailoring benefits to different workforce needs, including women’s health support, which was sought by 74% of women surveyed, and ensuring coverage remains accessible across income levels and life stages
The findings also come as employers and insurers face rising costs in Canada’s group benefits market, increasing pressure to improve the value employees receive from existing coverage
The Canadian Life and Health Insurance Association reported insurers paid a record $143.3 billion in health and retirement claims in 2024, up about 12% from the previous year. Mental health has become a major driver of those costs. According to Benefits by Design, mental health claims account for more than 35% of disability claims by volume but roughly 70% of total disability claims costs because they are typically more frequent and longer-lasting than other conditions
That trend is prompting many insurers and benefits advisors to focus less on expanding coverage and more on improving employee awareness and use of existing benefits, reflecting RBC’s finding that access alone is not enough if employees do not understand what is available
The market remains highly concentrated, with Sun Life, Canada Life and Manulife controlling about 63% of Canada’s group benefits business. RBC Insurance is among the smaller providers seeking to differentiate through employee engagement and benefits experience rather than price alone
Cost pressures also continue to build. Aon projects Canada’s medical cost trend will reach 8.3% in 2026, up from 7.4% a year earlier, while industry surveys found 43% of employers experienced benefit renewal increases exceeding 10% last year
Market implication for group benefits providers
The findings are based on an Ipsos online survey of 1,001 working Canadians aged 18 to 65 conducted between March 3 and 5, 2026. The results are considered accurate to within plus or minus 3.8 percentage points, 19 times out of 20
Taken together, the survey and broader industry data suggest that as employee wellbeing declines and claims costs continue to rise, employers and insurers are increasingly focused on helping workers make better use of existing benefits rather than simply adding new ones
