While we understand the essential of life insurance, but the fact is that life insurance cannot support your living expenses if you are disable from work. According to RBC statistics, one-in-three Canadian will experience a period of disability lasting longer than 90 days during their work period. In fact, 62% of Canadian workers have been reported to take days off due to disability and 25% had to take time off by themselves without any support. People usually think that if they are disabled from work, it’s probably just 3 months maximum and they can use their savings during that time. The number also reveals that less than half of Canadians experience condition such as depression and arthritis ability along with physical disability. In addition, the pressure from paying your loans, mortgage, renting monthly can possibly stress you out and prevent you from recovering.
Most people think that unless they have a dangerous job or risky hobby, then they should consider disability insurance. However, the leading causes of disability claims include musculoskeletal, connective tissues disorder such as back and neck pain, joint, muscle and tendon disorders, foot and ankle disorders. These medical problems can affect anyone with any jobs, at any age.
How it works?
By definition, disability insurance will replace for your loss income when you cannot perform your work due to disability, it can be either physically or mentally. When you buy disability insurance, the plan will cover you either “any occupation” or “own occupation”. “Any occupation” means you are totally disabled from performing any jobs. If you are still able to work for a less demanding job, it means you are not covered under the policy. By “own occupation”, as long as you have reason why you are not able to perform your work, but you can still do other jobs for living, then the insurance still pay you benefits from the policy. The good thing is that if you don’t happen to make any claims and the policy ends, you will get the refund for your premium. So you can consider it as force-saving money and you are under coverage at the same time.
Who will have most benefit if buying disability insurance?
Most of companies would have disability plan for their employees. It will vary from company to company. If your company covers 60% of your salary but only up to $2,500 a month in the event you have accident or illness prevents you from work. Then, you may have enough coverage for your daily expenses, mortgage and loans, if you are single and have no dependents. However, if you have high incomes which are more than $80,000 a year, then the payment is just around 30% of your salary. As a result, you seriously should consider buying a private disability plan that will pay you more for your needs.