You can expect to pay 1-4% of your current income or 2-6% of the monthly disability benefit amount you choose. Cheaper doesn't always mean better and the most important thing to pay attention to is policy definitions. In addition, your disability insurance cost depends on several factors including:

• Policy definitions such as whether the policy considers you disabled if you can’t work in any occupation, or if you can’t work in your occupation?
• Is your considered policy non-cancellable and guaranteed renewable, or can the insurance company raise the premium or cancel your policy at certain intervals like 5 years?
• The financial strength ratings of the insurance company?
• Your gender, smoking status, height, weight
• Your financial information like bankruptcy
• Your occupation and the risks you have to take outside of work such as skydiving etc.
• Optional benefits added to the policy such as inflation protection or partial benefits

Disability insurance is like insurance for your ability to earn an income. It covers you if you can't work and earn an income if you get sick or hurt. You consult with your doctor and they recommend how long you need to be off and that will be the period you will get paid the benefit. Your benefit amount depends on your income and you need to be employed to be able to replace your income. You can claim multiple times if you get injured or sick multiple times over the life of your policy.

In general, your ability to earn a living is your most important asset as if funds your lifestyle. Disability insurance provides you with a percentage replacement of your income if for some reason your income is cut down or stops immediately due to an illness or injury and you can't work for a while. It is a foundational insurance that holds up everything else.

Any type of disability insurance you have in place is good as long as it will pay you when you need it. The challenge of workplace disability insurance is that it it before taxes when you get paid a benefit. So you typically end up with a 40% pay cut that will be taxed once you receive it. In addition, if you make over $100,000 a year you are covered up to a maximum for most group plans. Disability insurance at work is beneficial if you make a low income. If you make bonuses or commissions as a major part of your income, workplace disability insurance doesn't cover.

It depends on the policy terms. Disability will typically cover you for an injury or accident as standard. You will have to add an option for illness or sickness coverage. If you had a pre-existing condition stated in the policy at application, you will not be covered for that and it's considered an exclusion. It's important to read the policy provisions to determine what is covered and what is not. Blue Alpha Wealth can walk you through and explain the policy provisions thoroughly. 

Two main types of disability insurance in Canada are short-term disability insurance and long-term disability insurance. Short-term disability insurance covers lost income for about three to four months while long-term disability insurance typically pays a portion of your lost income for anywhere from one year to your entire life. This is why it's important to buy your own long term disability insurance because after a while your workplace long term plan will stop paying and expect you to go back to work.

You compare by looking at policy definitions such as definition for what is considered a disability and when and how they will pay. You also want to consider the financial strength and ability of the insurance company to pay. It's important to go through the contract language with an independent broker like Blue Alpha Wealth to ensure you get the right policy.

In most cases if you buy a private individual disability insurance policy, your benefits are tax-free as you have used after-tax dollars to pay for your policy. If say for instance you get a policy through work, if your employer pays the premium you will be taxed on your benefits. If you pay the premium you won't be taxed. Always talk to your accountant for tax advice for your unique situation.

Yes you can. These are called guaranteed issue disability insurance policies. The drawback to these is that you will pay for the policy but at time of claim you will go through underwriting or medical exam to see if there is any issues. The insurance company can deny a claim if they find something or an issue wit your health that would cause them not to pay. It's always good to do medical underwriting prior to buying a policy so you know exactly what you're covered for.

This is the time that passes before the insurance company starts paying you your monthly benefit. it's like a deductible of time. It makes the cost of your policy cheaper the longer you wait to receive benefits. You can have a 0 day, 15 day, 30 day or 90 day waiting or elimination period.

It depends on how long you are able to go without an income and can tap into your savings. Most policies are priced to have the sweet spot as a 90-day elimination period. The premium doubles by decreasing the waiting period to 30 days.

This is a case whereby you have a pre-existing condition and at time of application the insurance company approves your application on the condition that they don't cover the pre-existing condition if it's necessary not to. This exclusion could be temporary or permanent and if temporary the insurance company will let you know when the exclusion will come off and under what circumstances.

It depends on the insurance company and the type and severity of the medical problems. The insurance company has three options:

• Charge you a higher premium for the policy
• Exclude the condition from the policy
• Decline insurance altogether

It's important to determine this prior to application in the event you want to take a dry-run before you apply.

Group Long Term Disability Insurance

• Benefits are taxable if your employer pays the premium
• Benefits based on a percentage of base income. Bonus and commissions are typically not covered
• Benefits typically reduced during a period of disability if you receive benefits from another source or work in a different occupation
• More restrictive definitions within the policy (qualification for benefits may require you to be unable to work in ANY occupation)
• No rate guarantees
• Partial disability may not be covered
• Policy can be changed or canceled by the insurance company or your employer at any time
• Policy is connected to the employer and generally not portable

Individual Disability Insurance

• You receive benefits tax-free if you pay the premium
• Quality plans will cover you in your own occupation/specialty
• More liberal definitions within the policy to pay you more money in more claims scenarios
• Higher monthly benefits
• Benefits can increase with inflation
• Rate guarantees to age 65 or for a lifetime
• You own the policy and can take it with you to a new job or occupation (portability)