Alberta Disability Insurance 101

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Disability insurance is an in important part of your complete insurance protection. Today we will discuss what it is, and why it’s important for hardworking Albertans.

What is Alberta Disability Insurance?

Disability insurance in Alberta is a living benefit life insurance product. It pays the beneficiary a portion of their income should they become disabled and unable to work for a period of time. The definitions of “disability” vary from carrier to carrier, so it’s important to be very aware of how the term is defined in your policy.

An easy way to think of disability insurance in Alberta is “income protection.”

Why is only a Portion of My Income Covered?

Not going to work and getting a paycheck sounds really good, doesn’t it? The truth is, not everyone is motivated to be active in the work force. In Alberta, disability insurance is capped, no matter where it comes from. That means, if you have disability insurance through work and several individual policies, you can still only claim a set portion (75%-85%) of your pre-disability income. This is called the “all source maximum” and it’s designed to motivate Albertans to return to work when they are physically able. It’s important to know this, because if you have too much disability insurance coverage, you can actually pay for coverage you can never use! Work with a broker that will ensure you have enough, but not too much, disability coverage.

Can’t I Simply Access the Province’s Disability Benefits?

Disability benefits from the Province of Alberta are geared towards individuals with a severe and prolonged disability that could shorten their lifespan. Typical Alberta disability insurance covers things like needing time to recover from a bad accident, illness or a mental health issue. It is very difficult to meet the definition for disability benefits from the province, which makes an individual disability insurance plan a smart choice.

What are the Chances of Suffering from a Disability?

One in three Canadians will suffer a disability that takes them out of the workplace for 90 days or longer. Those are not the best odds! If you think you be the lucky two out of the three, why not look into a return of premium rider? This rider returns all or a portion (depending on your policy) of your unused premium after a certain length of time. It’s a “get your money back” rider that is sometimes built into the base policy, and sometimes available for purchase. If you are interested in a return of premium rider, speak with a broker.

Why Should I use a Broker over an Agent or Bank Representative?

One word : choice. Brokers are the industry’s “freelancers.” Unlike an agent that only works for one company, or a bank representative that only sells the products of the bank, a broker sells the products of every life insurance carrier in Alberta. That means, you don’t have to fit your needs around one policy. With all those options, you get a policy that meets your needs, and it doesn’t cost you anything to have this policy found, researched and recommended to you!  Brokers also help you with your Alberta Disability Insurance application, and can assist you with claims, questions and more.

Disability insurance helps you stay on track financially when an incident or accident takes you out of the workplace for an extended period of time. Speak with an Alberta life insurance broker today about this important piece of financial protection.

 

Reassured For Life is an Alberta life insurance brokerage providing advisor services that fit your needs, budget and lifestyle. To know more, visit www.Reassured.Ca/Blog.

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