Will Bankruptcy Affect Your Employment Insurance (EI) Income?

Does Bankruptcy Have An Impact On Your Employment Insurance (EI) Income?

The world we live in is filled with uncertainties. Economies, including Canada’s, are facing inflation, rising interest rates, and energy insecurity. Economists predict a looming recession, which could lead to job losses and increased dependence on employment insurance for monthly income. If your debts exceed your reduced income, you’re in trouble. Hence, the question arises: Will bankruptcy affect your Employment Insurance (EI) Income?

Federal Programs to the Rescue

The Canadian Federal Government has implemented robust programs to provide relief from debt. They include the filing of a Consumer Proposal or Bankruptcy, which immediately halts collection activities. Both these filings provide comprehensive relief from unsecured debts. Only Licensed Insolvency Trustees are authorized by the Canadian Federal Government to file and manage these programs.

The Federal Government also administers the Employment Insurance (EI) system. If you’ve accumulated enough employment hours and are laid off, you might qualify for EI benefits of $2,000 or more per month. However, you must apply for EI and adhere to their reporting requirements as stipulated in the Employment Insurance Act.

You could also qualify for EI if you’ve recently become a parent or need to temporarily leave work due to illness.

But, if all these are Federal Government programs, Will bankruptcy affect your Employment Insurance (EI) Income?

The answer is a solid NO. Your EI benefits won’t be interrupted by filing a Bankruptcy or a Consumer Proposal.

Insurance Alternatives

Besides Employment Insurance, be aware of other insurance programs when your income is disrupted. These include:


  • Protection insurance for loans.
  • Insurance for critical illness.
  • Insurance for job loss.
  • Medical insurance.


These insurance products might have been offered when you took a loan. To determine your eligibility, you’d need to review your loan agreement or contact the creditor.

Despite these insurance products being challenging to claim, it’s worth a shot.

Impact of Bankruptcy Filing on CPP and OAS Pensions

Managing the increasing cost of living on a fixed pension income is challenging. Many seniors rely on a combination of Canada Pension Plan, Old Age Security, and possibly the Guaranteed Income Supplement, all managed by the Federal Government. Losing these would be devastating.

If escalating rents and food prices push a senior into debt, filing for Bankruptcy might be necessary.

Luckily, just like employment insurance, filing for Bankruptcy won’t cause you to lose your pensions.

Pro tip: File your personal tax return annually to prevent any disruption to your pensions and to continue receiving your quarterly GST credits.

We’re Here to Help!

If you foresee that you won’t be able to pay your debts, especially if you lose your job, it’s best to act quickly.

At Bankruptcy Canada, we provide a free initial assessment where we examine your financial status and inform you of your available options. This appointment is confidential and judgement-free.

As an independent company, we can spend as much time as required to answer all your queries without any pressure.

Filing a Consumer Proposal or Bankruptcy in Canada is designed to give the honest but unfortunate individual a fresh financial start. Contact us to schedule your appointment today and regain control of your financial future!

Find Your Personal Debt Relief Solution

Licensed Insolvency Trustees are here to help. Get a free assessment of your options.

Discuss options to get out of debt with a trained & licensed debt relief professional.