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The employer can ask what he wants to ask. It is not unlawful but it may be grounds to quit and sue for constructive dismissal.
It is unlawful for the insurers to give out health information without your consent and if that happened you can file a complaint with the privacy commissioner.
If the employer lied and this caused you to lose your benefits so long as you can prove this you have a good case for suing the employer for damages and if that is the case then your best next step would be to consult with a lawyer face to face in your city.