What You Need to Know About Disability Insurance

When an accident, illness or disability happens, disability insurance can replace a part of your earnings.

What You Need to Know About Disability Insurance

It is a fact of life that bad things happen at times. One in three people become disabled for 90 days or more at least once before reaching the age of 65.

In Canada, both business and personal disability coverage is offered, with flexible features to aid in bridging the gap of income and expenses.

More About This Topic

Disability Mortgage Insurance
Short-Term Disability Health Insurance
Long-Term Disability Rates
Disability Laws
Key Man Insurance

You can choose mortgage insurance to cover just your mortgage payments, or full coverage. You also have the option of short-term disability health insurance to help cover private care needs.

Coverage for the self-employed person, and anybody else who is not covered by their employer, is crucial.

Never Underrate the Importance of Having Disability Cover

Most people think of a disability as a loss of mobility, caused by a work incident or a sport.

Contact Us For a FREE Consultation

We're waiting to help you! Click here to ask any question. We'll contact you with your answer, or to make an appointment, free of charge.

Statistics tell a different story, though. It is twice as likely that a person becomes disabled from a serious illness, such as heart disease or cancer, than from an accident.

A person who is under 65 years old shows to be twice as likely to find himself disabled long-term, rather than dying from an illness or an accident. The numbers rise gradually with age.

  • 3 out of 100 children, up to the age of 14 become disabled
  • 4 out of 100 youths that are between the ages of 15 and 24 become disabled
  • 7 out of 100 who range in ages 25 to 44 become disabled
  • 17 out of 100 adults from 45 to 64 become disabled
  • 40 adults in 100 who are 65 or older become disabled
  • 53 of 100 adults that are over 75 are disabled
At least 14 Canadians out of 100 are classified, at the moment, as being disabled. That is a whopping 4.4 million Canadians.

Disability Insurance Benefits

There are different types of disability benefits that have been put together to fit various situations and needs.

For instance, life insurance is for survivors that are suddenly faced with an emotional loss, leading to a financial loss as well.

Disability insurance, on the other hand, is protection for you if you were to become disabled. The disability insurance can help you to maintain a sufficient level of income for self and family.

Often with a disability, there are extra medical expenses involved, and this income can help with these as well.

We have seen examples of people who had disability insurance that allowed them to come back to work at a much slower pace. For example, they came back to work for 1-2 hours per day and gradually increased their time until they could work a full day again.

With the disability insurance, they weren't forced back too early or too fast because of financial constraints.

Without disability insurance, a once self-supporting person now has to find the extra money to pay for these additional expenses, as well as the regular expenses. This makes having disability insurance just as vital as life insurance.

What Exactly Does being Disabled Mean?

Being disabled does not always mean that a person cannot do some form of work to create an income. According to disability insurance laws, there are three disability definitions that most illness and injury insurance contracts define.

Contact Us For a FREE Consultation

We're waiting to help you! Click here to ask any question. We'll contact you with your answer, or to make an appointment, free of charge.

Any Occupation

Under the ‘any occupation’ definition, being totally disabled means that the person is unable to work in any sort of job. For example, if you are a computer consultant, prevented by disability from working your regular duties, but you are able to work at something else, you will not receive any benefits.

Regular Occupation

This definition means that if you are totally disabled, and unable to perform the duties required for your job due to illness or injury, you would receive financial help. Once you are able to work at another form of occupation, you no longer can receive benefits. Short-term disability health insurance may kick in.

Own Occupation

This is the most comprehensive, total disability cover. It is defined as not being able to work your regular job, and additionally, that you are under the care of a doctor. A person is allowed to work at something different than his occupation, and still be able to receive full benefits from a disability insurance company.

It brings with it a higher premium, but comes with an assurance that an insurance company will pay out much higher benefits. Highly-skilled occupations such as surgeons and managers choose this type.

See our article on Key Man disability insurance for the business version of this insurance.

Group Coverage is Not Enough

A disabled person is eligible for receiving some government benefits, but these benefits are extremely limited.

What You Need to Know About Disability Insurance

Group plan coverage also will not come near to matching a person's current income. The coverage is usually 50 to 60 percent of net income.

A person with sufficient disability insurance will be able to cover the large gap in lost finances and be able to adequately cover the missing income.

Why Disability Coverage is Critical

Long-term care costs in Canada have risen dramatically in the past few years; the numbers continue to rise. All Canadians who are working should be aware of the importance of having disability cover, for those times when things go badly and they are unable to continue bringing in an income. The longer a disability lasts, the worse the disabled person is affected.

Even though long-term disability rates have also risen, planning for bad times, and setting a secure disability plan into place, means that the impact of financial loss will be much less. The better policy taken out, the better the protection is.

Be sure to consider exactly what you want your disability coverage to include. Look at the benefit period, how long you have to wait to start receiving benefits, what percentage of income your policy will replace, and what it includes or excludes.

Financial protection is a top priority. It becomes one of the highest assets a person can have to give yourself and your family the security needed to be able to survive when illness or injury occurs.

Contact Us For a FREE Consultation

We're waiting to help you! Click here to ask any question. We'll contact you with your answer, or to make an appointment, free of charge.

Having disability insurance prevents financial sorrow during the hardest of hard times.

Return from Disability Insurance to the Canada Life Insurance Companies home page

More About Canada Life Insurance Companies

Click the images or links below to find out more about the life insurance you're interested in, or to request a quote.

Best Term Life Insurances

Best Term Life Insurance Quotes

Canada Life Insurance

Canada Life Insurance

Disability Insurance

Disability Insurance

Estate Planning Checklist

Estate Planning Checklist

Key Man Insurance

Key Man Insurance

Universal Life Insurance Canada

Universal Life Insurance Canada

Whole Life Insurance Quotes

Whole Life Insurance Quotes