Canadians are generally quite comfortable talking about death or significant ailments, including aging, like we pretend we are invisible in our prime earning years. Disability insurance is also known as income protection insurance which is an insurance product that offers you protection against loss of income by replacing a significant portion of your pay check if you become disabled.
For example, the disability insurance offers you the coverage that agrees to replace 6025% of the regular income irrespective of whether the loss of earning ability was due to a degenerative ailment on a sudden accident. The benefit payment gets made to you until you are good to get back to working or until the end of the disability coverage. Whichever comes first.
Do I Need Disability Insurance in Canada?
Well, this is a personal question; as an honest advisor, one will tell you that disability insurance is a must-have for anyone depending on the regular income to pay for mortgage costs, support the family, or provide any other daily living expenses. However, this product is not for you if you are one of the rarest people who could live the rest of their life in the comfort of your current savings.
Benefits of Getting Disability Insurance
At Ez Financial, we ensure that when you invest in disability insurance, you and your loved ones live a stress-free life knowing that your income will flow during the period when you are not able to work. You will get protected irrespective of your occupation. Even if you are a business person and your disability prevents you from working at a regular job, the disability insurance will pay you, so you don’t need to stress.
Types of Disability Insurance Provided by Us
We offer two types of disability insurance. Both the insurance policies will pay a benefit that will replace a percentage of your income. Still, they work differently as short-term financial needs are different from long-term financial ones.
Short Term Disability Insurance
Several disabilities don’t keep you out of the workforce for more than a year, and short-term disability insurance is specially designed to provide you with an income that will help you with a basic income. At the same time, you take time to recover from the ailment. As a result, you can collect benefits for at least six months depending on the policy you have and even take advantage of the resources that will help you get back to work sooner.
Long Term Disability Insurance
Some disabilities are pretty severe and can also be permanent. Long-term disability insurance is ideal for these situations as the benefits can last four years. You can buy them as an individual policy if you are a higher-income business owner and professional who wishes to protect your lifestyle. At the same time, you are not able to work.
Who Can Apply for Disability Insurance in Canada?
You can apply for the disability insurance at Ez financial provided you are a Canadian citizen and a permanent resident or landed migrant between 18 and 55. You need to work a minimum number of hours per week, and you might get eligible even if you have some pre-existing ailment, but it might get excluded from the policy.
How Much Disability Insurance Coverage Do You Need?
The disability insurance mainly depends on the fact that you need to have enough money to align with your living expenses like your hydro, food rent, transportation, and taxes besides rent and mortgage. For some people, it might mean that you need at least 60% of the regular pre-tax income, and if you don’t have kids or have mortgages paid off, then you need 40 to 50%. At the back of your mind, the disability policies have a benefits cap like 65% of the gross income, which comes to around $3000 a month. For example, if you are earning more than $70,000 a year, then the coverage might be insufficient, and in that case, you need to consider a private disability policy.
Things That Are Not Covered in Disability Insurance
Not all conditions will get covered under the disability insurance, including harsh elements like cancer or a history of experiencing heart attacks. The state will not get listed as an exclusion to the policy even if approved despite the current situation. The opportunity ailments, including HIV or the AIDS virus, are not included in the policy.
The cost of disability insurance coverage depends on the age; as the older you are, the higher your premium will be due to the increased risk of experiencing a disability. Even the gender will decide the cost of the disability insurance as women are most likely to get disabled with age, and once the benefits start coming in, this stops working. Hence insurance rates for women can be a little high. The current medical condition can also impact how much you pay on the premium.
To know more about Disability Insurance, get in touch with Ez Financial today!.