Disability Insurance

Why should I subscribe to a disability insurance policy?

A personal disability contract is essential to ensure your financial protection as a business owner. Generally, the ability to earn an income is your most important financial asset!

Few people are expecting to suffer from a disability. Disabilities are however a reality with disastrous effects on your financial well-being. What are exactly your odds of developing a disability?

The percentage of people that will be disabled for at least 90 days before the age of 65 and average disability duration

Age % of becoming disabled* Average duration**
25 years old 44 % 2.3 years
30 years old 42 % 2.7 years
35 years old 40 % 3.1 years
40 years old 37 % 3.3 years
45 years old 33 % 3.4 years
50 years old 28 % 3.3 years

* Ref: Commissioners Individual Disability Table A.1985, CIA 92 Aggregate Mortality Table, weighted 50/50 man/woman
** Ref: Commissioners Individual Disability Table A.1985, 1985

Where will your income come from if you are disabled?

  • From my spouse - a spouse can cover some or all of your costs. That being said, your disability can influence your spouse’s revenues by requiring that he/she takes care of you and take on more responsibilities. There may as well be additional costs like child care, house adaptations, and medical treatments.
  • From the government – as a company owner, you probably do not have access to unemployment insurance and Worker’s compensation coverage. Even if you had access to those programs, these plans are very restricted in scope.
  • From my savings – if you have saved 5% of your income, it will take around 6 months of disability to get through 10 years’ worth of savings! Do not forget that all withdrawals from a REER are taxable.
  • From loans (loans and credit) – this may be a short term solution, but in the long run it will get you further into debts since they add monthly costs. It may also be difficult for a person with a disability to obtain new loans and a new credit line.
  • From selling assets - would you be willing and able to quickly sell enough assets, at their full price, to meet your needs while being disabled?
  • From my salary – how much time your company will be able to support the payment of your salary? Not only you will not be contributing to the company’s operations but a replacement employee will most probably be hired and therefore create a new expense?
  • From my group insurance plan - True. Did you know that the disability protection coverage offered by group insurance programs is not that well adapted to the realities of a business owner? For example:
    • The definition of disability changes after 24 months. After this time, you must not be able to perform any gainful occupation to maintain your disability benefits;
    • There is no protection for a partial disability period;
    • Benefits are not indexed to the cost of living;
    • Dividend income is excluded from your earned income (earned income is used to calculate your level of coverage);
    • The coverage is generally limited to 5,000$ per month.

From my own personal disability insurance program – THE ONLY EFFICIENT SOLUTION!

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What is disability insurance?

Disability insurance is an income replacement program in the event of a disability.

This contract protects your income by replacing it, at least in some measure, should an injury or a disease prevent you from performing the normal duty of your job. It guarantees your financial stability through benefits payable each month.

Our Disability Insurance Needs Calculator can help you estimate the amount of money you would need in case of a disability.

Insurers – There is only four insurance companies that offers guaranteed disability contracts (premiums and definitions cannot be changed once the policy is issued): Canada Life, Great-West, RBC and Manulife. Many other insurers offers non-guaranteed coverage

The Contract – we offer many individual disability insurance plans designed to provide you with income in case of illness or injury. With an array of additional riders to cover any disability situation and we can personalize each contract according to your needs.

  • Coverage Amount
    This amount is calculated from your earned income. We will analyze your personal income tax return and your company financial statements to set the coverage amount.
  • Waiting Period
    You can decide between different waiting periods (usually 30, 60, 90, or 120 days). A longer waiting period will have a lower premium for the coverage.
  • Benefit Period
    You can decide between different benefit periods (usually 24 months, 60 months, 120 months or until age 65). A shorter benefit period will have a lower premium for the coverage.
  • Riders
    Many options can be added to your contract to better meet your needs. Our recommendations always include this information.

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Take advantage of PPTA's offer

  • Save 25% to 50% on your group insurance premiums with the Vias Concept
  • Update, secure and manage all of your financial coverages
  • Have expert claims management
  • Take advantage of innovating cost-control solutions, plan for the unexpected, and maximize your assets