Disability Life Insurance Canada

Free Disability Life Insurance Quote – Start Now!

Disability insurance provides a monthly benefit to policyholders who get a disability at some point in their life. The policy enables you to manage financially even when your ability to earn a living is severed through disability. In Canada, it is more likely for anyone below 65 years to get disabled than it is to die. This means that a disability cover is more crucial even than a life policy. In fact, disability is the second highest reason for bankruptcy in Canada only after credit card mismanagement. Without proper planning by taking the disability cover, you can severely and permanently damage your finances and your living conditions and that of your dependents.

Group Vs Individual Disability Insurance

Group disability insurance is taken by an employer or an association for its employees or members. A group disability cover will increase an employers ability to hire and retain good employees. Group disability insurance is negotiated on the number of employees and is provided on an annual renewable policy. Underwriting is not taken on the individuals but on a group as a whole and therefore, no medicals are taken. Premiums are determined by the number of people under the cover and the risks exposed to the group members based on their working conditions. A quality group disability insurance policy should have an option for the members to continue with the policy even after moving employment from the original employer. The group policies may either be short term or long term disability insurance. The waiting period and the duration of the benefit is determined during the negotiation of the policy by the employer.

On the other hand, an individual disability insurance Canada policy is taken by an individual for the benefit of a monthly pay out in case the individual becomes disabled and cannot earn an income as they used to. For an individual disability insurance cover, the individual may need to take a medical and answer questions related to their health and specific working condition. However, the individual disability insurance Canada policies are more customizable and you can have more extras for higher premiums. Extras will include cost of living adjustments, proportionate disability compensation and benefit with own occupation rider.

Long Term VS Short Term

Short term disability insurance Canada policies will usually run for less than an year. The policy is taken to help the victim get back to their feet and adjust to the disabling condition. The waiting period for a short term disability insurance will normally be between 2 weeks to a month. On the other hand, long term disability insurance provides benefit from an year to a life disability insurance. The long term benefit provides the insured better cover as they can enjoy benefits for longer. The waiting period for the long term disability insurance may be anything within 6 months. This is to give you enough days to claim for sick offs and any pending annual leave. For those on long term liability cover, you may be required to claim for the government Canada Pension Plan (CPP) disability benefits. The insurance company will reduce this benefit from your monthly allowance. Some insurance companies will also provide some training to the disabled person to enable them get their own income.

‘Own’, ‘Any’ and ‘Some’ Occupation

Long term disability insurance will allow for compensation in the first two years if you are severed from your ‘own’ occupation. This means that you cannot perform the duties that you used to perform before the disability. Once the 2 year period is over, the policy changes to ‘any’ or ‘some’ occupation. She policy covers will only provide benefit eligibility to those who cannot do ‘any’ work. This means that if you are able to do some form of work, the benefit seizes. On the other hand, other policies will allow for a partial compensation if you are able to do some work. This are some of the clauses one should look out for especially if you are going for an individual disability insurance.