Disability Insurance is designed to protect your most valuable asset – your ability to earn an income! A disability can occur because of a degenerative condition such as Multiple Sclerosis, a sudden injury due to an accident or an unexpected illness such as Cancer or a Heart Attack. We never know when the disability may happen, but we do know that a disability will more than likely cause you to lose your income and therefore, your standard of living. Your income stops but your everyday living expenses don’t!
Disability is more common than you think, in fact 1 in 7 Canadians currently have a disability and 1 in 3 Canadians will become disabled and unable to work for at least 90 days before they turn 65! When a disability lasts longer than 90 days, the average length of that disability is between 2.1 and 3.2 years, but many disabilities will inflict the individual for the rest of their lives. 60% of disabled people need help with daily activities, such as walking, cooking, cleaning and personal hygiene.
Interestingly enough, less than 10% of disabilities are caused by accidents, such as workplace injuries or vehicular accidents. The following most common forms of disability may surprise you:
- 31% Mental Disorders including Depression, substance abuse, Alzheimer’s disease and other dementia.
- 16% Cancers such as lung, colon, breast etc.
- 12% Cardiovascular diseases
- 5% Musculoskeletal diseases such as Arthritis
Arrange to “own” your personal/individual Disability Insurance plan! An individual plan can provide you with the most comprehensive and flexible coverage available because it can be tailored to your individual circumstance and needs. This type of plan is generally Non-Cancellable and Guaranteed Renewable which means the policy cannot be canceled and the price cannot be increased during the period of time set out in the contract as long as you keep you policy in force.
The majority of Disability Insurance plans will replace between 60 to 70 percent of your normal income up to a set maximum dollar amount. They allow you to choose both when you wish for the benefits to start, such as 30, 60 or 90 days from the event of disability and then how long you wish the benefits to be paid such as 2 or 5 years or to age 65. Dependent upon the contract and the Insurance Carrier you select, the policy will contain different definitions of disability such as Total, Partial or Residual as well as other built-in provisions such as Rehabilitation. You also have the ability to select other optional benefits such as Guaranteed Insurability, Cost of Living Adjustments and Return or Premium that serve to enhance your coverage and therefore create the customized program you desire.
So just how much Disability Insurance should you have? That depends on many things:
- Your Lifestyle – which includes your current standard of living cost and what could be cut back on should you become disabled.
- Your Family Responsibilities – Who depends on your income? Just yourself? Are you a single parent or even a non-custodial parent with child-support responsibilities? Are you married with a stay at home wife who looks after the child rearing? Do you have parents or siblings who depend on your income?
- Employment Flexibility – Would you be capable or willing to change jobs
- Debts – If your pay Cheque stops, who will make your debt payments such as a mortgage or car payments? Who will look after your day to day expenses such a food and clothing?
- Financial Resources – Consider how dependent you are on your pay Cheque – would you have saving or investments that you could cash into to provide income and if so, how long would they realistically last?
- Future Dreams – What would happen to your future plans for yourself, your family and your retirement if your disability were to outlast your savings?..
The process of applying for the purchase of individual Disability Insurance is more involved than some other forms of insurance you may purchase as the underwriting process is extensive and will include but is not limited to:
- Your current job and details of your duties
- Past jobs or occupations
- Earnings, past and present
- Your health, past and present
- Hobbies and Activities
- Possible Medical/Physical requirement
- Financial Information such as Tax Assessments
At Health Risk, we believe that Disability Insurance may be the MOST important insurance you will ever own! We have a Disability Insurance Specialist who has over 30 years of experience in working with clients to assist them in their journey of selecting and purchasing their Disability Insurance programs. We would welcome the opportunity to guide you through the whole process of purchasing your customized Disability Insurance plan!!
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DISCLAIMER: Please be advised that the information on this website is intended to present a broad variety of general information as simply and accurately for your knowledge as we possibly can. In no event does this information form part of or apply as a legal document. Therefore, please note that rules, conditions and industry practices discussed may be changed over time.