Disability Insurance
Many group benefits plans from employers include coverage for Long Term Disability. Most people, however, have little idea how much of their income they are covered for, when it would kick in, how long it would last, and what qualifies as a disability. Another important factor that is often overlooked is whether or not any possible payments would be taxable or not.
At Erb and Erb Financial Services, we work with a number of insurance carriers to provide the right type of disability coverage for every need. If you do have group disability coverage, we will review your coverage and make recommendations for top up coverage if your situation warrants it. For example, some plans have benefits that don't begin to payout until 3 months or longer. Sure you may be entitled to Employment Insurance, however, will that be enough income? If not, an individual top up disability plan will fill the gap, paying out after tax dollars and not offsetting your EI payments.
For those that do not have disability insurance through a group plan, we can put a plan together that will cover your income loss up to the legislated maximum while doing so tax efficiently.
Coverage for Almost Any Situation
Disability Insurance is one of the most, if not THE most complex type of individual insurance out there. Every carrier has their own policy wording, construction, rules, and methodologies. There are many different Classifications of employment type based on risk of injury for someone in that job classification. While coverage is in force whether on the job or off in most cases, people who work with their hands, at heights, in hazardous situations, etc are rated to be more prone to disability and, therefore, would pay higher premiums. Factors such as amount of coverage, length of coverage (typically 2 years, 5 years, or until age 65), waiting period before benefits begin, whether the benefit is paid out due to a loss of the ability to do your OWN job only or if its a loss of the ability to do ANY job, and others all have a bearing on the premiums the carrier will require.
Maximum coverage is based on a percentage of your income, however, most group plans cap out at a certain level regardless of an individual's income level. With our years of experience providing Disability Insurance coverage, we can work with clients of all income levels, all professions, and all budgets in order to find the proper amount of coverage for you to ensure the amount of income you receive during a disability is sufficient for your situation.
The Statistics
We are often asked about the importance of having Disability Insurance in place. The statistics bear out that the odds of one suffering a job pausing illness or injury causing a loss of income is much more common than many believe.
According to the Canadian Society of Professionals in Disability Management (CSPDM), at any given time, 8-12% of the Canadian workforce is off work due to illness or injury and relying on various types of insurance, worker's compensation, or simply whatever savings they have accumulated. The longer someone is off on disability, the likelihood of them returning to work decreases. As an example, after one year of absence, only 20% of workers will return to their job. According to RBC Insurance, 68% of Canadian workers have indicated they have taken time off of work due to disability, however, only 50% actually have any kind of coverage for such an event. The fastest growing segment of disability claims? Not surprisingly...mental health.
Give us a call today to schedule a review of your current disability benefits and find out how we can ensure you and your family will not suffer financially should such an event happen.
