Losing your mobility because of an unexpected accident related to work or sport – that is the traditional explanation of the word ‘disability‘ for most people. Nevertheless, just look at the statistical figures and you will see that accidents are accountable for only about a half the amount of handicapped people than serious sicknesses such as cancer, diabetes or heart diseases.
You and becoming handicapped?
If you are younger than 65, your chances of becoming long-term handicapped due to an accident or disease are double than the chances that you will die because of these causes. Naturally the chances of becoming handicapped gradually raises with age:
* out of every 100 children up to 14 years, 3 are classified as handicapped
* 4% of young people between 15 and 24 years become handicapped
* 7 in 100 adults between 25 to 44 become handicapped
* 17% of adults between 45 and 64 years become handicapped
* 40% of adults of 65 years and older become handicapped
* out of every 100 adults over 75 years, 53 are handicapped
The current numbers tell us that right now, about 14% of Canadians are classified as handicapped, which is some 4.4 million in real numbers.
What are the benefits of disability insurance?
There are different people who have different needs and encounter different situations, therefore the selection of different types of insurance is quite rich. Life insurance, for example, is offered to guarantee a sufficient cash coverage for those that are hit by the sudden loss not only emotionally, but also financially. In the opposite case, after someone becomes (completely) handicapped, the first problem is his/her not being able to keep earning a sufficient income for themselves and the whole family. Moreover, there are even higher expenses related to the extra medical and other care the person suddenly needs, which means even more of a financial trouble for the family of the person who was once able to support him/herself and now needs specialized care. So we can see that a good disability insurance can help you deal with even more problems than a life insurance. Nevertheless, there are different definitions of disability, meaning that some handicapped people are able to have some kind of a job, but the numbers tell us that some 15% of people filing for bankruptcy are giving illness or accident as a reason. There are some government contributions available for handicapped people, however limited they might be. The coverage group plans don’t help to keep your current income either, as they usually cover between 50% and 60% of the previous net income.
If you are thinking about getting for disability insurance, first think about the possibilities you would have in case you couldn’t earn a sufficient amount of money.
You could:
* place the confidence in your spouse/family
* use your savings or retirement funds
* get rid of your property or other assets
* get a loan
* get a sufficient income from a disability insurance instead of your previous salary
Lorne S. Marr has been a very accomplished financial planner since 1993 and runs his own Toronto life insurance company LSM Insurance Services Ltd. He’s recognized as an industry leader thanks to the commitment to providing clients with value-added services.
Lorne has also been a keynote speaker at numerous industry functions and has appeared in The National Post, The Toronto Sun, the Investment Executive, The Advisor’s Edge and the Insurance Journal. Don’t forget to visit his website http://www.lsminsurance.ca
There are no posts related to Disability Insurance - Do Not Take it Too Lightly.
Leave a Reply