Disability insurance policy is taken to cover an individual from loss of income in case they are incapacitated by an illness or physical disability. There are various different types of disability insurance Canada covers and one needs to review the disability insurance quotes keenly especially with the limitations and disqualifications. There are two types of term disability insurance covers namely the long term and short term disability insurance.
Long Term Disability Insurance
Long term disability insurance Canada covers an individual for a long period of time usually many years and it is taken to cover for severe disability and mental illness that leads to an individual being unable to perform their former job indefinitely. A life disability insurance will cover the insured individual for the remainder of his or her life. The amount of the disability pay-out and the duration of the payout differs with different long term disability insurance policies. The policy also have a waiting period usually for 6 months before the individual commences getting the disability insurance compensation.
Short Term Disability Insurance
Short term disability insurance is usually taken by employers for their employees under a group disability cover. The insurance policy usually covers for income loss for a short period usually 6 months and below. Before the benefit commences , a waiting period of about a week is given. Ideally, it is presumed that the individual can utilize sick off days or regular leave days for this waiting period. The short term disability insurance benefit amount depends on the policy terms and may range from the minimum unemployment amount to 66% of the basic pay.
A majority of employees in Canada will have a group disability insurance cover taken by their employer. Such a disability insurance Canada group cover will not involve reviewing the individuals under the cover but instead, the insurance company considers the overall risks of the employees and the number of staff. The company then agree with the insure on such issues as the benefit period and waiting period before settling on the premiums. Most group disability insurance Ontario and disability insurance Toronto companies renew policies on an annual basis and the premiums may based on various factors. The pay-off by the company depends on whether one can work in their ‘own’ occupation which is the occupation of once career or skill sets or whether one can work in ‘any’ occupation even beyond that of their former skills. Depending on the structure of the disability insurance cover, the premiums may be taxable or non taxable.
Individual disability insurance differs from group insurance in that the insurer underwriter looks at the health conditions and the risk exposure of the individual person seeking the policy. In general, workers who perform corporate careers requiring high eduction will get classified on higher occupation grades. This translates in linger benefit periods. On the other hand, people doing physical jobs will fall on lower classifications resulting in shorter benefits periods. An individual disability cover is also more flexible and the insured individual can seek extra benefits such as cost of living adjustments for extra premium price. Some of the key factors that one should consider when selecting an individual disability insurance Calgary is taking a policy that allows you to do part time work while still earning the disability benefit, a policy that covers individuals with pre-existing medical conditions and a cover that provides proportionate disability compensation. Some of the advantages of individual disability is that it is not taxed.