What is Disability Insurance?

When you are the one who provides for a family, you probably wonder what would happen if you ever were injured and unable to work. This could be the insurance policy you are looking for. Disability Insurance can be very helpful if you need financial security during times of injury and healing.

What is Disability Insurance?

Disability insurance is an insurance policy, also known as Disability Income Insurance or Income Protection Insurance. Disability Insurance is designed to assist you and your family in being financially secure if you are ever injured or disabled. Disability insurance provides income replacement until you are healed enough to go back to work. It replaces a portion of your paycheque using a percentage of your usual income. The disability can be caused by either accident or illness. You and your loved ones will get assistance from the insurance payments until you can work again, or until the coverage term ends. You can work your policy so your payments come weekly or monthly.

Why Get Disability Insurance?

Anyone who is the sole provider of income, or If you have a regular income, you should consider getting disability insurance. Almost everyone has rent or mortgage to pay or support immediate or extended family members. You need to have coverage if you sustain an injury or get an illness that prevents you from working.

Several factors affect the cost of Disability Insurance. Benefits and premiums are affected by the following factors: gender, age, family health history, physical condition, and occupation. If you have other coverage, Disability Insurance payments may be reduced to offset the other benefits.

What Does Disability Insurance Cover?

There are many reasons to have disability insurance, accident, or illness.

Four Types of Disability Insurance

• Own occupation means you are unable to perform duties of your own job
• Any occupation is set up so benefits can only be paid if you are unable to do any part of the job for which you are trained and qualified.
• Short-term disability insurance gives coverage for up to two years or for temporary issues and injuries. This is the type of insurance you should get when you recover and go back to work.
• Long Term is where the insurance provides benefits and coverage for long-standing issues or injuries that will last months to years, or until you reach 65 years of age.

This insurance will make sure you will not lose income due to your inability to work, allowing you the time you need to get back on your feet. You will be able to pay bills, buy food, and cover household expenses.

Take care of your finances with disability insurance

If an accident has temporarily or permanently kept you from working, you can receive a tax-free monthly benefit if you have disability insurance coverage. This plan helps pay your monthly expenses. You also have the freedom to personalize your disability insurance coverage by adding extra benefits at a cost.

How does disability insurance coverage work?

Now that we know what disability insurance coverage is let us understand how this insurance policy works. In the unfortunate event, you become disabled; you must file a disability claim. After the filing is complete, you have to wait for the claim to be approved. Once approved, there is a waiting period; the waiting period is the start date of the benefit, including the number of days from the date you became disabled. This waiting period can be anywhere from 30 days to a year. Your monthly benefit would begin after the waiting period has been achieved.

Types of disability insurance:

1. Short-term disability insurance

If you are suffering from an illness or injury, the coverage is provided for up to six months. Additionally, the waiting period is typically shorter than long-term disability.

2. Long-term disability insurance

Sometimes life does not go according to plan; a severe injury or illness can prevent you from working for a prolonged period or permanently. A long-term disability plan protects you and your loved ones financially.

Reasons to purchase disability insurance:

1. Tax-free benefit

If your company provides disability insurance, you usually don’t pay for it. The amount that you receive is tax-free, as you have already paid taxes on it.

2. Regular option coverage and occupation option coverage

Disability insurance often comes with two types of coverage, regular coverage and occupation coverage. When you opt for occupation coverage, you are covered if you can no longer perform the job, you were doing when you got sick or injured. If you believe you can do any job for a regular occupation, you will not need much help with your bills.

Significant impact on your finances

Have you considered what would happen to you and your family if you became sick or had a workplace accident? This is where disability Insurance comes into the picture. This type of coverage can get you some amount to help you and your family cover expenses in the event of your inability to work. Many individuals do not understand what a disability insurance policy offers; before purchasing a disability insurance coverage, you must:

• Identify if you need short-term or long-term disability coverage.
• Find out how much of my salary the disability insurance coverage covers.
• Know if the insurance is covering my job.

Are you the sole income earner for your family? Do your parents depend on your income? If the answer is yes, you need to purchase a disability insurance policy. The unpredictability of life is petrifying, as one unfortunate event can leave you and your loved ones financially unstable. If you cannot work due to a severe injury or illness, owning disability insurance can help pay for expenses like utilities, school tuition, mortgage, food, and car payments. This insurance plan replaces a portion of your income if you are unable to carry out your work. Back injuries, heart diseases, and cancer are the majority of long-term disability claims.

Contact our expert insurance advisors today!

Don`t take a chance on life and own disability insurance coverage today. At Canadian LIC, our professional insurance advisors are experienced and have the patience to explain thoroughly why disability insurance is essential. To find out more details or to schedule a consultation, call us at 416 543 9000 today. We will be more than happy to address your queries.

Things To Know About Disability Insurance

If you have ever found yourself wondering what you would do if you became injured and unable to work, you may want to take a look at Disability Insurance. This is a great policy if you want to have peace of mind for your and your family’s future.

What is Disability Insurance?

Disability Insurance is a policy for you and your loved ones to be protected financially if you are disabled. Disability can be from illness or injury. The insurance provides income replacement until you are able to go back to work, if possible. It supplements your paycheque by using a percentage of your income.

Why should I get it?

If you have a family or other financial obligations like a mortgage or rent, you will want to have financial security if you are suddenly unable to work due to illness or injury.

Factors that Affect the Cost of Disability Insurance

• Smoking: This is often the cause of paying higher premiums for disability insurance. If you don’t smoke, you have more chances to get affordable premiums and other health benefits.
• Age: This is a major cost-determining factor. The younger you are the more you get the policy, the less costly it will be. There is less of a chance of becoming disabled while you are young.
• Occupation: A skilled tradesman or manual labourer will have a higher cost for disability insurance than a person with a desk job having a high income.
• Health: If you are healthy, with no critical illness, you will pay a low cost for disability insurance.

Types of Disability Insurance

Own Occupation: Benefits paid if you can’t perform complete duties of your own position at your job full time.

Any Occupation: Benefits paid if you are not able to do any part of the position or job for which you qualified.

Long Term: Benefits paid for disability issues that will last anywhere from a month to years, or the policyholder is 65-years-old.

Short Term: Benefits paid for temporary issues or those that last for up to two years. These are issues you will recover from and will be able to go back to work.

Having Disability Insurance is just another way of taking care of your family. Ask your insurance broker for more information on Disability Insurance today.

Do I really need a disability insurance?