Another thing – mentioned previously – my dad went to work for Bell Canada in 1936 and other than the Royal Canadian Navy during WW II, that was his only employer. Not true any more. Stats Canada says we now have three separate CAREERS and 8 employers over our working lifetime. Now another thing to think of: Canada wishes/needs to be competitive in world markets. We – along with our neighbor to the south – are among the most expensive economies in the world. Why do you think so many employers – and I mean MAJOR ones – are now hiring under contract? It reduces their costs – because they do not have to supply benefits and makes them more competitive. This is very unlikely to change. Let’s assume you have a job and are earning $X annually and someone comes along and offers you a 30% raise. MIGHT you consider it? What happens if that new employer does not offer benefits? If you are healthy – fine. But what happens if you have elevated blood sugar – or full blown diabetes? What happens if you have been treated for stress? or anything else?

If you want to truly uderstand the risk – let me tell you a story. My brother used to be President of the Canadian subsidiary of a US corporation – they make a well known oil treatment for cars. While there he had a group plan and back then that meant I could do nothing for him. The former owner decided to sell the company and the new owner wanted his guy to run Canadian operations – totally normal. So my brother decided to set himself up as a self-employed graphic designer working from home – with no established income – again we could not insure him so he had to take his chances.

HE LOST!

Easter weekend 1988 he was driving down to the Toronto airport when someone coming in the opposite directio just had to pass another car – even though there are solid lines clearly indicating “NO PASSING”. Result? A head-on collision at a combined speed of about 120 mph. I hate to tell you this but cars are NOT built for that. It took them an hour to get him and his wife out of the car. He had been basically split in half by the impact with the steering wheel. We did not expect him to survive the weekend. He did – but he has now had three hip rebuilds and will walk with a cane for the rest of his life – but that is NOTHING. The blood transfusions which saved his life also gave him Hepatitis C. By the way – he found out he had this disease when he was applying for disability insurance. Of course he is uninsurable and would give anything to have even $1,000/mth of DI.

I was a technical guru when it came to DI. Once Chris had his accident, I realized how few policies actuaries sell – and I have become an evangelist for personal DI. BUY SOME – even if you can only afford $1,000 or $750 – buy it with Guaranteed Insurability. It guarantees your ability to buy new coverage without proof of health – and IT ALSO GUARANTEES YOUR ORIGINAL OCCUPATION CLASS.

PS – if you are incorporated and self-employed, the definition of income is MUCH more liberal than just the salary you declare

What you have is group disability. This would not have features such a a cost of living increase, partial disability (if you can only work part time you would still get a paycheque) there is also many other features not offered with group disability plans. Plus if you leave the company in many cases the coverage stops.

Yes, the cost maybe higher, but at claim time which is better something you can collect, or have a harder time with?

regards,

Brian

We get 2/3 of the first $3,000 of pretax monthly income + 1/2 of the next $9,000 of pretax monthly income up to a max of $6,500. However, this only kicks in after 120 days and I can’t find any mention of what our short term disability coverage is.

I don’t even think our employer allows us to opt out. It would be interesting to compare an individual plan for cost/benefit vs. our employer provided one.

Someone who is self-employed needs to show income to get coverage. The problem is many self-employed people make much more than they show (for lots of reasons). So the coverage is going to be much lower than they need.

One idea for people who are self-employed show a low income, but have a mortgage is look at Blue Cross, which would coverage mortgage payments for the 20 -25 years they may have to make payments. This is not perfect but better than nothing.

All Member Plans operate on a not-for-profit basis. (Blue Cross) each plan may be different for different provinces.

Great question! The answer is no you do not have to reapply!

Example: Lets say you have a Dentist who is tired of looking at people’s teeth, he/she now wants to be a roofer. As long as the policy is in place before he/she changes careers, you are in good shape.

I tell any one who will listen, if you are working at a job that has benefits and are thinking about being self-employed…get a disability policy now! It may take 2-3 months to get it placed… if you become self employed during this time there will be problems.

If I understand the question:

” Also, are the premiums for self employed DI higher than own occupation DI premiums for the same income insured”?

Short answer is no, The premiums are based on income and what kind of job you are doing which includes daily activities. Example a Chartered Accountant who also helps fixing machines at the print shop.

Hope this helps!

Also, are the premiums for self employed DI higher than own occupation DI premiums for the same income insured?