Disability Insurance

Safeguarding your earnings against the unexpected!

Continued earning is an essential part of everyone’s life, be it through your own business revenue or your monthly income. Earning is crucial to not only keep up with the standard of living but also to meet the basic individual and family requirements like education for your children, retirement planning, or any medical emergencies. But what happens when an unexpected event takes place that keeps you from working for a longer period of time and stops your regular earnings?

 

When you can’t work, your disability insurance will get to work for you. It is designed to protect your earnings if you are unable to work due to an injury or get handicapped. It protects you and your family from any unforeseen event like an injury or sickness or a mental health issue, that disables you from working and earning an income for a short or long time, by providing you with a tax-free monthly income that can assist you to meet your day to day expenses.

 

Statistics show that over one-third of Canada’s population gets disabled for 90 days or more before the age of 65 due to an injury, making disability insurance an essential step in safeguarding your family’s livelihood. Disability insurance usually covers about 60% and 85% of your usual earnings for a specified period of time, depending on if you are unable to work temporarily or are permanently handicapped due to an injury or disease.

There are several types of disability insurance coverage available, such as individual insurance plans and group insurance plans, as well as government schemes such as workers’ compensation and benefits given under the Canada Pension Plan (CPP). However, there are two major categories to consider while you decide on the type of disability insurance that would work best for you.

Disability Insurance for Income Protection

As the name suggests, this type of insurance coverage is designed for employed people having a fixed monthly income. Many Canadians receive disability insurance coverage from their employers. However, it may not be sufficient to compensate with the level of protection needed to replace your lost income.

 

Employers generally opt for a group insurance plan for their employees. Though group insurance is a great start to have, they only provide basic coverage. Thus, it is wise to get an exact idea of the disability insurance coverage from your employer, to see how much you have and can plan accordingly on how much individual disability coverage plan you will need based on your day-to-day expenditure.

 

Having a personal disability insurance policy enhances your group insurance coverage, and both together can work better to safeguard you, your family, and your way of life in the event of a disability.

Disability Insurance for Business Protection

Commonly known as Business Disability Insurance, it is a disability insurance coverage designed for both small and enterprise business owners, to help keep their business running smoothly in case they are unable to work due to an injury. It acts like a reserve fund to protect a dream they’ve worked so hard to build, without using the actual business reserves.

 

Basically, a business disability insurance is a policy owned by your company to provide you a monthly remuneration for a time period, while your injury keeps you away from work. There are several coverage plans available to help protect your company while you are unavailable.

 

  1. Business Overhead Expense Plan
    This is a non-cancellable overhead expense disability insurance policy that can cover qualified company overhead expenses while you are totally disabled. It supports you with continued monthly payments for 1 to 2 years, or as long as long as your injury lasts.

  2. Protection for the Key Person
    With this plan, you can provide a source of income for a key employee or your business partner while they are disabled. Also, these funds can help cover debts and expenses to protect the business from lost sales, increased expenses, or high replacement costs when a key employee is totally disabled.

  3. Buy-Sell Agreement
    A buy/sell insurance agreement provides funding for the acquisition of a shareholder’s or partner’s shares or for an ownership interest from a fully handicapped shareholder or partner.