DISABILITY INSURANCE ADVISOR
NORTH YORK

Helping You Stay Afloat When Life Hits a Pause

With sudden pauses, such as injuries or illnesses that stop you from earning your daily bread, the dilemma of how to manage your finances arises. A disability insurance in North York offers invaluable support by replacing a portion of your salary (typically covering between 60 and 85 percent of your salary). It helps you pay for your basic needs (such as mortgages, rent, food, or other expenses) without the need to deplete your savings or incur debt.

Types of Disability Insurance Coverage

Short-Term Disability Insurance

Short-term disability insurance in North York provides a financial security net in cases of temporary illness or injury. This helps cover the income gap, whether you are recovering from an operation, fighting a disease, managing a mental health disorder, or on maternity leave.

Here’s how this coverage works:

• You start receiving benefits for a minimum of 9 and a maximum of 52 weeks (most commonly 13 or 26 weeks)
• Before you receive the benefits, you have to face an elimination period (or waiting period) of 0-14 days
• These benefits will help cover at least 60-85% of your usual earnings

Long-Term Disability Insurance

Long-term disability insurance in North York protects you in case you are unable to work due to health reasons for a long time, or permanently. This involves severe conditions such as cancer, heart-related diseases, neurological diseases such as MS, chronic pain or any severe mental conditions.

Here’s how this coverage works:

• You can choose from different coverage periods, which vary from 2 years to 5 years or may last until your retirement
• Before you start receiving the benefits, you will have to face an elimination period (also called waiting period) of 90 to 180 days
• The meaning of “disability” according to various policies may differ; for some policies, a disability is considered only when you are unable to perform at your current job, while many policies consider a disability when you cannot work in any role that matches your qualifications

Why Should You Have Both?

Several people living in North York prefer to have both short-term and long-term disability insurance to gain complete peace of mind. Short-term covers you in case of short-term recovery and long-term in case of a lengthy absence. Combined, they offer great coverage, regardless of how long you are unable to work.

Calculating the Benefit Amounts

The percentage of earnings replacement offered by different policies under disability insurance in North York may differ. It serves as essential financial protection when your earning capacity is affected by an illness or accident. During such times of uncertainty, when you also have ongoing financial commitments, these policies offer between 60% and 80% of the replacement value.

Waiting Period (Elimination Period)

Before you start receiving benefits from disability insurance in North York, there is a waiting period (known as the elimination period). It is the time after the event has occurred that has led to the disability. It may take as long as 30 days or may extend to several months before you start receiving benefit payments.

Typically:

• The shorter the time you have to wait, the higher your premiums will be. However, the relief is that the benefits start early.
• The longer the time you have to wait, the lower your premiums will be. However, you must be prepared to cover your expenses until the benefits begin.

How Your Disability Policy Renews

Before you purchase disability insurance in North York, you must understand how these policies work and what their renewability terms are. You must also consider how they can affect your financial situation in the future and keep you stress-free. The type of security you are being offered may vary from policy to policy, and so do your terms of renewability and change in premium rates. 

Your Options for Policy Renewal:

Non-Cancellable Policies

Disability insurance that is non-cancellable is usually considered the most secure option. Under such a policy, your insurer does not have the right to cancel your insurance or increase the rate of premiums unless you are making timely payments.

Guaranteed Renewable Policies

If you are looking for flexible disability insurance in North-York that offers long-term protection, guaranteed renewable policies must be your choice. Under such a policy, your insurer can make changes to the premium rates, but only if they apply to a wide group of policyholders. 

Optional Policy Riders (Enhancements)

To increase the effectiveness of your disability insurance in North York, you must also explore the options for policy improvements. They enhance your coverage, helping you achieve long-term financial protection. These rides are more like an addition to the security your policy provides, offering better flexibility when basic policies may not be sufficient.

Common Policy Riders for Better Coverage:

1. Cost-of-Living Adjustment (COLA) Rider
   With this rider, the valuation of your benefits increases in situations such as inflation. After the event that leads to a disability, you start receiving the benefits. The amount you receive will increase gradually, matching the Consumer Price Index (CPI) or at a consistent rate of 3%.

2. Partial (or Residual) Benefits Rider
   This type of additional benefit is available when a disability has affected your working capacity but has not completely prevented you from performing your duties. In case your disability has led to limitations in earning your total income, this rider covers the gap by offering residual benefits.

3. Future Increase Option (FIO) Rider
   A FIO rider is suitable if you are seeking flexible coverage that expands as your income increases. Under such circumstances, you also do not need to obtain another medical underwriting. These changes can be made yearly or after you achieve a significant milestone in your life.