# Critical Illness insurance vs Disability Insurance



## james4beach (Nov 15, 2012)

Quick background: I'm in my late 30s, healthy (no significant conditions), covered under provincial healthcare but no supplementary health.

Currently I do not have either kind of insurance. I left my job and will likely work independently for a while, as a self-employed professional, picking up contracts. I may also work for an employer again, but almost definitely not lifelong. I am able to earn a reasonably strong income as long as I'm in good health.

I'm trying to make sense of disability insurance (DI) vs critical illness (CI). Some questions:

1. DI appears to only pay out as long as you are unable to work. What if you get injured -- e.g. cancer or heart attack -- then recover somewhat, but remain at a diminished capacity. Does the insurance stop paying out? It seems to me that you'd be back in the workforce, earning less income (not able to work 100%) and also have no insurance assistance any more.

2. Critical illness insurance doesn't use the words "injury" in their descriptions, and I'm trying to find out what happens in case of illnesses that result from injury. For example, a car accident or sport accident (*I'm a cyclist*) leading to brain injury. If the brain injury is a recognized illness, for example in Sun Life Critical Illness, would that cover the situation in which a bike or car accident caused the injury?

3. As I'm self-employed, I believe that CI is really my only option at the moment. What do you think about someone in my situation getting CI, to be able to afford extra care or income replacement for being unable to work, in situations like: very serious car/bike accidents or major illness?


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## Longtimeago (Aug 8, 2018)

I guess as a 30 something year old, you are not used to talking to people rather than texting as you are doing here. If I wanted to know about medical insurance, I would PHONE an insurance provider and TALK to someone who is an expert in that subject, not post in a forum of non-experts. 

https://www.huffpost.com/entry/when...bku4yH5sF7E69NslzxFc2cFbVQJY2XJiflO73QMtDNyQ-

https://www.inc.com/wanda-thibodeau...ne-calls-anymore-according-to-psychology.html

If I wanted an answer to your question james4beach, I would simply phone an insurer and ask someone the question, 'which one suits my situation better and why?'


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## Money172375 (Jun 29, 2018)

james4beach said:


> Quick background: I'm in my late 30s, healthy (no significant conditions), covered under provincial healthcare but no supplementary health.
> 
> Currently I do not have either kind of insurance. I left my job and will likely work independently for a while, as a self-employed professional, picking up contracts. I may also work for an employer again, but almost definitely not lifelong. I am able to earn a reasonably strong income as long as I'm in good health.
> 
> ...


Hope that helps a little


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## Beaver101 (Nov 14, 2011)

Re post #1, short opinions to questions:

1. You only "qualify" for DI if you have some sort of employment as you would have to prove your employment income (whether through an employer (group) or self-employment (individual).) (Making a claim is a whole different story. Going to the moon is alot easier.)

2. CI is for a "life-threatening" illness (eg. stage 4 cancer) - very stringent definitions as a lump sum is paid out. 

3. Being a biker, since you're concerned about getting into an "accident", you may want to consider an Accidental Death or Dismemberment policy instead. The CI shouldn't be ruled out. Quickest route (unless you know a non-predatory insurance broker) - look into your professional association policy if you haven't to see what's offered.


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## james4beach (Nov 15, 2012)

Longtimeago said:


> I guess as a 30 something year old, you are not used to talking to people rather than texting as you are doing here. If I wanted to know about medical insurance, I would PHONE an insurance provider and TALK to someone who is an expert in that subject, not post in a forum of non-experts.


I _love_ talking to people; the problem is that I don't like talking to single-minded salespeople. I've phoned a couple insurance brokers before, and they seem to immediately start wanting to sell me on things and then started hounding me with follow up calls (and I eventually told them to forget about it). This makes me not trust them. It looks to me like their business is to sell me something, not to give an honest and impartial idea of what might be useful in my situation.

It makes me doubt the professionalism of insurance brokers.

I'm doing some preliminary research. Of course I will approach a broker eventually.


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## james4beach (Nov 15, 2012)

Beaver101 said:


> Re post #1, short opinions to questions:
> 
> 1. You only "qualify" for DI if you have some sort of employment as you would have to prove your employment income (whether through an employer (group) or self-employment (individual).) (Making a claim is a whole different story. Going to the moon is alot easier.)
> 
> ...


Thanks! And yes, I think DI wouldn't work in my current situation anyway due to the sporadic self employment.

Good idea to check the professional association policy. I will also take a look through a couple university alumni arrangements.

You mentioned CI is for life-threatening illnesses, but from what I read at that link [ SunLife CI ] it also covers things like blindness. Does that not mean that if some accident results in blindness, CI covers you? That seems to go far beyond just life-threatening illness... or am I misreading the intent of the plan?


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I _love_ talking to people; the problem is that I don't like talking to* single-minded salespeople. I've phoned a couple insurance brokers before, and they seem to immediately start wanting to sell me on things and then started hounding me with follow up calls *(and I eventually told them to forget about it). This makes me not trust them.* It looks to me like their business is to sell me something, not to give an honest and impartial idea of what might be useful in my situation.
> *
> It makes me doubt the professionalism of insurance brokers.
> 
> I'm doing some preliminary research. Of course I will approach a broker eventually.


 ... the proof is in the pudding. Amen.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> Thanks! And yes, I think DI wouldn't work in my current situation anyway due to the sporadic self employment.
> 
> Good idea to check the professional association policy. I will also take a look through a couple university alumni arrangements.
> 
> You mentioned CI is for life-threatening illnesses, but from what I read at that link [ SunLife CI ] it also covers things like blindness. Does that not mean that if some accident results in blindness, CI covers you? That seems to go far beyond just life-threatening illness... *or am I misreading the intent of the plan?*


 ... possibly as I interpret CI as covering "illnesses" ... blindness caused by an illness (eg. stroke?), and not an accident. But without the definition (I haven't checked), I can't be absolutely sure. Only the insurance company is absolute on that.


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## james4beach (Nov 15, 2012)

And these wonderful insurance brokers that Longtimeago talks about, do they have a similar training to lawyers? Will I be able to dive into the nitty gritty legal text of what a policy will have -- for example, view sample legal text of a policy contract?

And how does one agree to a contract without seeing the precise writing? Normally, I look at the wording on a contract, then sign. Is that how CI and life insurance works as well? Or do I just hear some nice words from a non-legally-trained broker, trust them, sign up... and then receive the legal text in the mail later?

With insurance, I keep hearing that the policy contract will depend on the particular individual. So how does one ensure the specific wording of the contract, before signing?

Can I bypass the broker and check this kind of thing with the insurance company directly? I don't want just words, I want to see legal text in writing. If I'm signing up to pay premiums for the next 40 years I want to know exactly what we're agreeing to.


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## Longtimeago (Aug 8, 2018)

james4beach said:


> And these wonderful insurance brokers that Longtimeago talks about, do they have a similar training to lawyers? Will I be able to dive into the nitty gritty legal text of what a policy will have -- for example, view sample legal text of a policy contract?
> 
> And how does one agree to a contract without seeing the precise writing? Normally, I look at the wording on a contract, then sign. Is that how CI and life insurance works as well? Or do I just hear some nice words from a non-legally-trained broker, trust them, sign up... and then receive the legal text in the mail later?
> 
> ...


Where did you see me write anything about, 'wonderful insurance brokers'? Where did you even see me mention an insurance broker? Read my lips, I wrote 'insurance provider'. That means an insurance COMPANY. ie. Sunlife etc. Call them directly and ask to speak to someone who can answer your question. Here's Sunlife Customer Care for example:
1-800-361-6212, Monday to Friday, 8 a.m. to 8 p.m. ET. I do not insure through them by the way, I just picked an easy example.

They can tell you what their policies cover and do not cover like is blindness from a bicycle accident covered under CI or DI or not etc. Just don't let them try to fob you of on an agent etc. insist on speaking to someone in their head office who will explain their policies to you. Getting to talk to the person you want to talk to and NOT following their preferred procedure for dealing with someone is not always that easy to do but it can be done.

It's the 'systems' that we often find are not designed to suit us, they are designed to suit the businesses and how they prefer to do things. Ignore their systems and get them to do things the way you want to do them.

Your wish to make sure of what you are signing up to for 40 years is not unreasonable at all james4beach and stating just that may get you to a person who you feel comfortable is telling you it like it is. Persisting in a phone conversation with a company to get to the person you want to talk with is all it takes in my experience.


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## james4beach (Nov 15, 2012)

This is great advice Longtimeago, sounds like the right course of action - thanks very much! I'll start on this today.

I misunderstood at first and thought you were saying I should speak to a broker/salesperson. I will phone the insurance company.


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## Rising Tide (Jun 5, 2019)

I have critical illness insurance and I somewhat regret getting it. It covers only the listed conditions in the contract, I think there are around 30 "illnesses" it covers. Apparently they are very strict with the definitions of these, eg. it may list cancer as an illness but it has to be in a certain stage; heart attack has to be to a certain seriousness; etc. for them to pay out.

Personally, at least for my coverage, I think it is to expensive for what the payout would be along with the perceived strictness in the definitions of qualifying illnesses.

Mine is attached to my life insurance, a 30 year term, but the CI premium will go up every decade. I plan on cancelling my CI when the end of the first decade happens as the premium will double. I think that DI is better, I'd still check into it and see if they can work with your employment situation.

These are CI conditions listed on mine:
1. Alzheimer's disease
2. Aortic surgery
3. Aplastic anemia
4. Bacterial meningitis
5. Benign brain tumour
6. Blindness
7. Cancer (life threatening)
8. Coma
9. Coronary artery bypass surgery
10. Deafness
11. Heart attack
12. Heart valve replacement
13. Kidney failure
14. Loss of independent existence
15. Loss of limbs
16. Loss of speech
17. Major organ failure on waiting
list
18. Major organ transplant
19. Motor neuron disease
20. Multiple sclerosis
21. Occupational HIV
22. Paralysis
23. Parkinson's disease
24. Severe burns
25. Stroke

I'm no expert but hope this helps a bit...


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## OptsyEagle (Nov 29, 2009)

james4beach said:


> Quick background: I'm in my late 30s, healthy (no significant conditions), covered under provincial healthcare but no supplementary health.
> 
> Currently I do not have either kind of insurance. I left my job and will likely work independently for a while, as a self-employed professional, picking up contracts. I may also work for an employer again, but almost definitely not lifelong. I am able to earn a reasonably strong income as long as I'm in good health.
> 
> ...


Without knowing your future, you probably need both of them. They are really two different products. The CI is designed to compensate you for the cost of certain illnesses and injuries and the DI is designed to replace your income in the event of all illnesses and all injuries.

Since they don't give either one away, or at least not the good ones. You know. The ones that actually pay are the good ones. I would probably lean towards the DI if you have to choose. As long as you have income, you will be in pretty good shape. It's not to say that with some issues a big lump sum of money would not come in handy but if you had your income you would probably still be OK. 

As for the partial disability that I think you were alluding to in your 1st point. The good ones pay for that too. You can set it up that if you have a loss of income, due to illness or injury, even though you are still working in some capacity, they will compensate you for the loss. As long as there was an illness or an injury. So that's not a problem.

CI is good too and it is awesome if you get one of those pre-mentioned nasty conditions. At least it is awesome compared to not having CI and getting those nasty conditions, but the problem I have is some of those conditions wouldn't cost you much at all. Some conditions you would have no idea how much money you would need, so how do you figure out the benefit you need. Maybe factor in lost income, but how long will you have lost the income? Know one knows.

DI is more certain. Did you have an illness or injury? How much income did you lose? We'll cover that. Pretty simple.

Note: The good ones have a name. Non-Cancellable Disability Insurance. It is just a name but any DI salesperson knows when you say you want non-can DI insurance, that you don't want any junk. The non-cancellable pertains to them. You can cancel it anytime you want. But they can NEVER cancel it. You can give me any scenario you can think of and then ask me if they can cancel it then, and I will say; no they can't cancel the policy. Oh sorry. You can't lie on the application, but once you clear that hurdle, they can never cancel it.


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## james4beach (Nov 15, 2012)

I like the sound of DI, but I'm not sure how I can get it when my self-employed (contract work) income is extremely unpredictable. It can jump from 0K to 200K in a year and is more like a series of random numbers. It will be very difficult to assess what income I am "missing out on", especially since I do a variety of work. So there is no way to answer this question of "how much income did you lose?"

In other words, DI may not be feasible for my kind of work. Is CI my only other option, or is there yet another kind of insurance I can look into?


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## Synergy (Mar 18, 2013)

If your finances are in order and you live within your means I don't think critical illness would be necessary. You can put aside the money yourself - self insure.

Young, healthy, single, not in a high risk profession (risk of injury) or in a high paying profession that requires precise physical skills (surgeon, etc.) I don't think disability insurance would be necessary. Read the policy wordings carefully "Any Occupant Test", etc. As mentioned above, some are better than others.

If you have a wife and children that rely on you, your family lives pay cheque to pay cheque, massive debt, etc. than maybe put some further thought into it. That would however not solve the true problem. If you have a predisposition for mental health conditions that may lead you to be unable to perform "Any" occupation, then some further thought would be wise.

I've sat through more luncheon and dinner presentations hosted by insurers than I can count. They carefully target certain professions. Who can resist a free meal while in school.

Your car insurance policy should cover you well for injuries sustained as a driver, passenger or pedestrian (walking, cycling, etc) who has been injured in a automobile accident. Check your policy details. No policy, get some further advice.

I would try to get some advice from someone you can trust who can review your specific needs. Take my comments with a grain of salt, just my non professional opinions from someone living in Ontario. Depending on where you live, things may be very different.

It all depends on how much risk your willing to take. There's always a chance....


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## james4beach (Nov 15, 2012)

I don't have car insurance because I don't have a car. I live in a central city area and use rental cars, or no car. So what many people typically have covered through car insurance, I have none of that.

I disagree with the feasibility of self insurance. For example even if I just suffered a brain trauma, such as a serious fall in sports / cycling / driving, my ability to focus and think coherently might be gone. My ability to earn income is directly tied to my ability to think coherently (and focus) in my field of expertise.

The fact I'm not a surgeon doesn't really change anything. Surgeons rely on steady hands and eyesight. In my case, I rely on straight thinking and focus, and also heavily on eyesight. There isn't much difference compared to a surgeon.

If I suffered an injury of that kind (brain damage, eyesight), I can kiss hundred of K of income goodbye. How would I self insure that? Even though my income is erratic, over a decade it still would gross over $1 million. If I had one of these injuries like blindness or brain trauma, I would think that I can't earn anywhere close to that any more.

Or to put it another way: if I remain in great health, I should be able to gross over $1 million income in the next 10 years.

OTOH if I had a brain injury or something horrible like a stroke that impeded my ability to work, that income would plummet pretty significantly (especially since I would need to take time off to rest and recover). What was once $1 million gross income might shrink to something like 500K or less. Wouldn't I be looking at a ~ 500K gross loss in case of serious illness/injury?


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## Synergy (Mar 18, 2013)

Like I said, there's always a chance. If you can't deal with the risk, by all means purchase the insurance. That's what it's all about. Purchase a limit that's high enough that enables you to sleep better at night.

Even though I partake in a variety of high risk activities I'm willing to roll the dice. As I get older and have more and more assets, the need for insurance becomes smaller and smaller.

Build a business that run's itself and you don't have to worry so much about the insurance.


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## OptsyEagle (Nov 29, 2009)

james4beach said:


> I like the sound of DI, but I'm not sure how I can get it when my self-employed (contract work) income is extremely unpredictable. It can jump from 0K to 200K in a year and is more like a series of random numbers. It will be very difficult to assess what income I am "missing out on", especially since I do a variety of work. So there is no way to answer this question of "how much income did you lose?"
> 
> In other words, DI may not be feasible for my kind of work. Is CI my only other option, or is there yet another kind of insurance I can look into?


DI and CI are probably the only options.

To get the base policy, the insurer will look at a couple of tax returns to determine your income. Of course no one gets 100% protection of income. The max is around 85% of your take home pay to ensure some kind of motivation to go back to work, if on claim.

Now the base non-can policy just covers "total disability". Basically meaning you cannot work at all. Since you have a concern, rightfully so, about partial disability, this is added as a rider. You can get "partial disability" or "residual disability" as a rider. The second one "residual disability" is what I described above where they compensate you for the loss of income if you are working but at a reduced capacity. The other one, "partial disability" simply asks if you are working at a reduced capacity (they basically ask the doctor if you can work full time or not) and if the answer is yes you are working at a reduced capacity, they simply pay 50% of the base monthly amount. They don't bother calculating an actual loss. They pay that pre-determined amount.

I think some policies offer both residual and partial in the same rider but I can't remember. That would allow you to claim the highest amount or whatever can be calculated. You would choose.

Last comment. The standard definition of disability in a non-can policy, states: You cannot do the substantial duties of your regular occupation due to illness or injury. That definition is only for the 1st two years. After that they change it to: You cannot do the substantial duties on ANY occupation. By the way, most group DI plans have this definition.

There are basically three definitions of disability, with the other two added as a rider, for a small premium.

1) *Any occupation *(described above)
2) *Regular occupation * The question of whether you can do your regular occupation does not change in two years. it is for the life of the contract and therefore they never force you to go look for work in any other occupation. If you do find work in another occupation, by your own choice, they would cut off DI benefits.
3) *Own occupation * The question of whether you can do your regular occupation does not change in two years AND if you choose to work in some other occupation, they will still pay you the benefits, since you cannot do your own occupation.

In my opinion, #2, regular occupation is a must have on a DI policy. You want to maintain choice. If you cannot do your current job you want them to pay until you decide if you want to do some other occupation or not.

#3, Own occupation is more of a perk. If you decide to work in another occupation, you don't really need the benefits. The loss is still covered by reg. occ. Own Occ. is really for people like surgeons or dentists, who if they could not work with their hands due to an injury, might want to still work elsewhere but would never be able to replace the income they lost as a doctor. Not everyone need Own Occ. but they probably do and a few others.

Nothing is free. Since you hope to never put in a claim, buy only what you need, is my opinion. I think I mentioned, they don't give this stuff away. It is a little pricy but that is more because of the fact that it gets used (claims submitted) far too often. Which goes to the fact that it is really needed by anyone dependant upon their income. That covers about 95% of all working Canadians.


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## OptsyEagle (Nov 29, 2009)

Last important thing you need to know, if buying personal DI insurance.

*Start dates*. In a perfect world you would have your DI insurance kick in a couple weeks after the onset of an illness or injury. I think 30 day start is about the earliest most non-can DI policies offer. So if you were injured today, your benefits would start in 30 days. They also offer starts dates of 60 days, 90 days, 120 days, 180 days, 360 days and 720 days. The last few are rarely used unless someone is trying to improve some other group policy that might have a change of definition in a couple years, as described above.

So what is the best. As said, earlier is better but more expensive, premium wise.

I found the sweet spot to be 90 day starts. It is the best combination of having benefits kick in before a person goes completely bankrupt and keeping the price more manageable. If I recall, once you put together the policy that fits you best, a 90 day start will see a premium drop of almost 50% of what a 30 day start costs. This is for an age 65 benefit period. So if you are forty, if you waive just 2 months of benefits from a plan willing to pay 300 months (25 years x 12 months) of claims, you can save almost 50% on that pricy policy. It is a no brainer to me and the only people who have 30 day starts are the people that did not get this explained to them or had an agent who had a child starting college that year and needed a big commission cheque. Agents get paid on total premium.

Anyway, enough said. Those are about all of the main important things to think about when looking at DI insurance.


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## Synergy (Mar 18, 2013)

J4B. Once you had a chance to review the coverages, policy wordings, premiums, etc. Let us know what you decide on.


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## james4beach (Nov 15, 2012)

Synergy said:


> J4B. Once you had a chance to review the coverages, policy wordings, premiums, etc. Let us know what you decide on.


Thanks for all the great suggestions and background info above. I am reading it all with great interest.

At the same time, as often happens, a whole bunch of things have piled up on me at the same time. I've had computer equipment fail, a smart phone fail (so I'm now shopping), new work piling up, and also want to look into these insurance options. I will be working on all of these as time permits.

Off topic: everyone, make sure you buy an external backup disk and back up your data routinely! A huge 2TB external disk is only $80 at Walmart and Best Buy.

However, I really do want to take care of this insurance or at least thoroughly get some quotes. Other engineers have suggested I look into IEEE (professional association) rates, so I will be looking into that.


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## OptsyEagle (Nov 29, 2009)

Usually the rates offered on professional associations are considerably cheaper. Certainly worth a look.


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## james4beach (Nov 15, 2012)

OptsyEagle said:


> Usually the rates offered on professional associations are considerably cheaper. Certainly worth a look.


Thanks. My colleague also suggested using the professional association's plan as a "benchmark" considering that they probably chose pretty good parameters. He also figures the association chose a plan that isn't a total ripoff.

So I could look at what's covered under the professional plan, the exclusions, etc.

Then perhaps get another quote from SunLife (which originally interested me) and see how they compare, including on what's covered.


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## OptsyEagle (Nov 29, 2009)

I think Professional Association (PA) plans are individually customized plans, basically identical to individual coverage, except cheaper. I have competed with PA plans many, many times in the past, and if I recall correctly, I lost the sale every single time. The price difference was significant. I suspect the lower cost is because they probably don't come with a highly compensated insurance agent. That could save a fair amount. 

Again, it does not matter where you get it. If it is non-cancellable, which I believe many PA plans are, then I think you now know about the insurance companies ability to ever cancel it. You would be able to take that with you wherever you go. It would not tie you to the PA at all, in the future. Just save you some money. I suspect you might need to be a member and that usually comes with some form of membership dues or fees, but perhaps you already are a member and already paying the dues.

Anyway, look into it and if you have any questions and they don't provide an agent, just PM me and I can probably shed some light on what is going on. Maybe they have CI as well.


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## james4beach (Nov 15, 2012)

Thanks OptsyEagle


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## james4beach (Nov 15, 2012)

Longtimeago said:


> Where did you see me write anything about, 'wonderful insurance brokers'? Where did you even see me mention an insurance broker? Read my lips, I wrote 'insurance provider'. That means an insurance COMPANY. ie. Sunlife etc. Call them directly and ask to speak to someone who can answer your question. Here's Sunlife Customer Care for example:
> 1-800-361-6212, Monday to Friday, 8 a.m. to 8 p.m. ET. I do not insure through them by the way, I just picked an easy example.
> 
> They can tell you what their policies cover and do not cover like is blindness from a bicycle accident covered under CI or DI or not etc.


I phoned a couple numbers at Sun Life (including this one) and when I start asking about the details of their sample policies, such as the definitions and whether a policy would cover a certain thing, they are telling me I should contact a Sun Life "advisor".

They have pointed me to some names, who they say are Sun Life employees, but not in the head office. These are local people and they are showing various random credentials. Some have CFP, some are B.Comm, B.A.

I have tried twice so far at the Sun Life numbers for the claims department, and they are not giving me any answers about what is covered under their plans. They always refer me to these "local advisors". Is this the right direction to go?

I want to have a detailed technical discussion on the wording inside this policy and I want to run through hypothetical scenarios, if I were phoning to make a claim on this policy: https://cdn.sunlife.com/static/ca/I.../SunCriticalIllnessInsurance-Term10-18-65.pdf

My goal is to learn details on the policy coverage and definitions. Are the advisors really the right people or are they going to be useless when there's no sales commission for them? On the other hand the claims department refuses to answer any questions, telling me these are not real policies.


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## james4beach (Nov 15, 2012)

Here's the kind of "advisor" Sun Life is trying to pass me to. These are clearly salespeople:
https://www.sunlife.ca/E/search/agent/default.asp?AID=106407733063398622954&pageId=ADVISOR

I am not sure this person can help answer my question. She wants to know my income, my "needs" and what I'm looking to cover. But I don't want to give any of that info. I have a specific policy and want to understand how the insurance company views the definitions, and whether a few hypothetical scenarios I have in mind meet the definitions for claims... and if not, I want to know exactly why the insurance does not covers it.

Or do I really have to go see one of these salespeople to get such info?


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## OptsyEagle (Nov 29, 2009)

Yes. That is a commissioned salesperson. If it was corporate her firm would be Sun Life not Aspire Financial. The other issue is the fact that she is in Manitoba. Something makes me think you are in BC, but if you are in Manitoba it would be a non-issue. If BC, one needs to understand that insurance licenses are issued provincially. Perhaps she has both Manitoba and BC, but one would need to confirm this. The only really useful thing an insurance agent has going for them is that provincial license that allows them to distribute insurance to the public.

Anyway, the claims department would need to send each scenario you give through their claims ringer before they could tell you for sure, yes that would be an acceptable claim. Anyone else will just look at the list of covered items and give you their best guess. That is about all I can do as well as what that women in Manitoba would be able to provide. So to answer that part of your question, advisors would be useless in that regard.


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## Eclectic12 (Oct 20, 2010)

There was talk about Alberta or BC ... but the thread on in the retirement section "Seeking advice in countdown to retirement" that is about the sabbatical with concerns about self-employment hours says:



> Winnipeg deserves some thanks for this because once that Sept snow storm hit, I got trapped indoors and thought I might as well work more. And today with -33 windchill, it's not like I'm stepping outside.



It seems Manitoba won out for now. :rolleyes2:


Cheers


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## james4beach (Nov 15, 2012)

OptsyEagle said:


> Yes. That is a commissioned salesperson. If it was corporate her firm would be Sun Life not Aspire Financial. The other issue is the fact that she is in Manitoba. Something makes me think you are in BC, but if you are in Manitoba it would be a non-issue. If BC, one needs to understand that insurance licenses are issued provincially. Perhaps she has both Manitoba and BC, but one would need to confirm this. The only really useful thing an insurance agent has going for them is that provincial license that allows them to distribute insurance to the public.
> 
> Anyway, the claims department would need to send each scenario you give through their claims ringer before they could tell you for sure, yes that would be an acceptable claim. Anyone else will just look at the list of covered items and give you their best guess. That is about all I can do as well as what that women in Manitoba would be able to provide. So to answer that part of your question, advisors would be useless in that regard.


I am currently in MB but I am not phoning this person to buy insurance, and I don't want a quote. I want to first learn the details (definitions/exclusions and how claims are considered) to assess whether I like their insurance policies. If I like what I find, then I will *later* approach a sales channel. Does this mean I should poke around near the headquarters such as in Waterloo or Toronto and find an "advisor" who appears to be corporate?

Are there other tricks to getting through to a corporate person? Any idea which department (or who) I should find, to ask these kinds of details about whether certain scenarios are covered? Again, I'm not going to buy it. I am trying to learn what the insurance covers... otherwise it's useless to me.

My concerns are issues like injuries sustained during walking / hiking / cycling. According to my reading of the sample policy, they should be covered (and are not excluded) but want to hear how the insurer thinks about this.

Let's pretend I make a claim. What happens? Does the insurer come back and say "no that isn't covered due to this specific text in the policy".

I've already verbalized to a couple Sun Life people on the phone that they are losing out on a potential sale, because I'm not able to get my detailed question answered to my satisfaction. I'm willing to pay good money for a good policy, and surely it should be someone's job to get into the guts of the policy -- the text -- and let me know what it covers?

Don't they want my money?


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## OptsyEagle (Nov 29, 2009)

It is what the advisor is for. They, unfortuneately, would first just give you their opinion. I, as well, would not think an injury sustained during walking, hiking or cycling would make any difference but that would be more of an opinion, then a fact.

The advisor could ask those questions for you but you know how it is when you have a middle person. Did the question get asked right and did the answer get told to you the exact way it was given? You will never know for sure.

So I can't really add much on how to solve this problem.


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## james4beach (Nov 15, 2012)

It sounds like I have to go through an advisor. This is frustrating. I hate the idea of people guessing at what's covered especially when they have an incentive to sell me a policy. I can't really trust a company that expects me to buy a tremendously expensive thing without telling me details of what I'm buying.

How about once I actually have the policy. Can I then at least actually call the claims department and go through details? At that point if I don't like what I'm hearing, can I just cancel the whole thing?

For example I'm currently under the impression that this CI policy would cover brain injuries or blindness due to various accidents including car/bike accidents. Sure, I like the sound of that. But perhaps after I buy the policy, I phone into Claims and inquire about the hypothetical. Currently they tell me to "get lost" because I don't have a real policy.

Once I have the real policy, will they still tell me to "get lost" or will they answer my detailed hypothetical claim question? And can I cancel it when I don't like the answer?


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## OptsyEagle (Nov 29, 2009)

Some people are paid to deal with customers and some are not. The ones that are not usually want to transfer you to the ones that are, pretty quickly. I have dealt with the public myself, so I kind understand why that is. That is an employee response, not necessarily what the company might hope from their employees, but it is how it usually goes with the employees.

Who knows. I can't say who might talk to who but I don't think it would matter whether you owned a policy or you were thinking of buying one. At most times a prospective customer is usually treated better then a customer, so if they won't talk to you now, I would not go to the trouble of buying a policy in the hopes that it would change.

It's not all complete guessing. I mean if brain injuries and/or blindness are on the list of items, if I was selling you the policy, I would put a hand on my heart and look you in the eye and tell you that yes, they are covered whether you are walking, running, cycling, dancing, whatever. I would sleep fine at night, but does that mean a judge might one day rule that the policy doesn't cover dancing? I can never be sure that won't happen. I doubt the guy in claims would even be sure that some ex OJ Simpson lawyer wouldn't find a new way of looking at that contract and change everything. Unless the question is one where they actually paid a claim, they are just going to read the contract and give you their best opinion on what they think it means. They might be right. Probably are.

I will add that if I did have a brain injury, while cycling on my bike, I would much rather find out how it is all going to work out, when I own an inforce, critical illness policy, then how it is going to work out, without one.


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## Beaver101 (Nov 14, 2011)

^


> I will add that if I did have a brain injury, while cycling on my bike, I would much rather find out how it is all going to work out, when I own an inforce, critical illness policy, then how it is going to work out, without one.


 ... isn't this kind of defeating what J4B is trying to do? Like "avoid" throwing $$$ away. OTOH, I would expect that's what a typical advisor (aka insurance salesperson) would say.



> It's not all complete guessing. I mean if brain injuries and/or blindness are on the list of items, if I was selling you the policy, I would put a hand on my heart and look you in the eye and tell you that yes, they are covered whether you are walking, running, cycling, dancing, whatever. I would sleep fine at night, but does that mean a judge might one day rule that the policy doesn't cover dancing? I can never be sure that won't happen. *I doubt the guy in claims would even be sure that some ex OJ Simpson lawyer wouldn't find a new way of looking at that contract and change everything. Unless the question is one where they actually paid a claim, they are just going to read the contract and give you their best opinion on what they think it means. They might be right. Probably are.*


 ... based on this, I agree 1. it's not complete guessing. It's complete "I don't even know what the hxll I'm selling to the public", and 2. sounds like you need a lawyer (and then a judge) to figure out if your claim will be eligible even.


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## james4beach (Nov 15, 2012)

I agree it's not complete guessing. I also realize lawyers can argue this stuff in court, but that's not the kind of thing I'm concerned about.

What I want to know is whether what I'm thinking of as a cycling injury is something eligible for CI payout. For example, perhaps there's a general exclusion that applies across the policy... or a definition which broadly excludes sports.

I'm concerned about injuries from car accidents too. Is there some broad, general exclusion of all kinds of injuries stemming from car accidents?

I don't want to make a claim and then have the claims dept tell me: "no, obviously this kind of car injury isn't eligible and never has been ... this is well known, I guess your sales person didn't understand the coverage but see it's spelled out right here in this wording used for the definiton".

In today's phone calls, I tracked down a Sun Life center (locally) and an agent suggested that I talk with the manager of the branch and tell him that I'm not comfortable talking with commission-based salespeople. This is the best answer I've found so far.

Still open to suggestions in general


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## Money172375 (Jun 29, 2018)

james4beach said:


> I phoned a couple numbers at Sun Life (including this one) and when I start asking about the details of their sample policies, such as the definitions and whether a policy would cover a certain thing, they are telling me I should contact a Sun Life "advisor".
> 
> They have pointed me to some names, who they say are Sun Life employees, but not in the head office. These are local people and they are showing various random credentials. Some have CFP, some are B.Comm, B.A.
> 
> ...


I think you might be overthinking this a little. The example policy you shared is likely going to be exactly like the one you’re thinking of purchasing. I don’t see any exclusions such as the ones you are thinking about. Other than some of the medical terms, it seems to be written in a clean and easy to understand manner. Are you really going to feel more comfortable with someone, whoever it may be at sun life, VERBALLY explaining scenarios and /or definitions? A claims dispute is always going to go back to the actual written policy. What you might hear from them is “go and seek legal advice” during the cool-off period. I sold mortgages and creditor critical illness for many years. 2-3 times in my career, I had a customer who was uncomfortable signing a mortgage loan agreement at the branch after I reviewed the document with them. My advice was....go and seek Independant legal advice and come back and sign when you’re ready. We too had a cooling off period for insurance applications for this very reason. It’s also the same advice people take when signing a purchase agreement for a new home. As much as your realtor may explain all the clauses, it makes perfect sense to have a professional and independent legal review for matters that are often six figures plus.

Where you can get into potential conflict is.....are you cycling illegally (is it illegal to cycle on the sidewalk....don’t know for sure)....are you hiking legally and never “trespassing” on someones land as you walk through the woods. These are the silly things a lawyer makes a point of to show you’re were breaking the law during your injury vs. The intent of the policy. Ie. sustaining an injury while attempting to rob a group of bikers while high on meth.


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## james4beach (Nov 15, 2012)

Good points and thanks for sharing your knowledge on this. Yes I have thought of going to a lawyer to have things looked over. Certainly might be worth a $300 consultation if I'm talking thousands in premiums x 20 years with potential payouts over 100K.

How would that work for insurance? Would they draw up the text, so I could take it to a lawyer for review before signing? Or do I have to sign up blind on verbal assurances alone, and then receive the legal text only after I've agreed to the policy?

How does one agree to a policy you can't see? I have no idea how this works.


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## Money172375 (Jun 29, 2018)

james4beach said:


> Good points and thanks for sharing your knowledge on this. Yes I have thought of going to a lawyer to have things looked over. Certainly might be worth a $300 consultation if I'm talking thousands in premiums x 20 years with potential payouts over 100K.
> 
> How would that work for insurance? Would they draw up the text, so I could take it to a lawyer for review before signing? Or do I have to sign up blind on verbal assurances alone, and then receive the legal text only after I've agreed to the policy?
> 
> How does one agree to a policy you can't see? I have no idea how this works.


Pretty much....sign up on whatever verbal assurances you’ve been given. You’ll be provided the actual policy which very likely has a cancellation period of 10-30 days where all premiums will be reimbursed if you decide to cancel. You could then take it to a lawyer. When I sold CI, we were instructed to give clients a solid overview but if they had additional questions, we encouraged them to apply for coverage and then speak to an insurance advisor at head office during the cooling off period. Don’t want to sound as though we neglected our duties, but when it came to detailed specifics beyond what was covered, for how long or for what cost...we deferred to the national call centre after the customer applied. (Keep in mind, I was selling creditor critical illness and was not licensed at all to sell other types of insurance - we were not insurance advisors)

Another no cost method could be.....purchase the policy and take the policy to a competitor and have them scrutinize the policy and ask them for their opinion on why their policy is “better”. Could say something like......”I’m into adventure sports....is there anything in this policy that would worry you compared to the policy you’re offering”. Nothing like getting a second opinion from manulife on a sunlife policy. If anyone will find something to critique, it will be their main competitor. Lol. Be sure this is also done during the cool-off period.


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## james4beach (Nov 15, 2012)

These are great ideas; thanks! I love the idea of going directly to the competing giants. Their chance to win my business, love it.

As someone who deals with contracts in my professional work, it still blows my mind that people are supposed to sign up on verbal assurances. Sign up first then maybe cancel... yikes. That's highly manipulative and puts the buyer at a disadvantage.


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## Money172375 (Jun 29, 2018)

The often mentioned critique of some of these types of insurance is what’s known as “post claim underwriting”. 
It’s often attached to bank branch based credit protection.

Basically you’re asked 5-10 simple questions and can walk away with a policy same day. The critique is that it’s only when a claim is made that the policy is underwritten and the insurance company starts to find ways to deny a claim.

My former work experience at TD never made me feel like we were in the business of denying claims. We often heard stats about the number of claims we paid and the number of customers we assisted through a difficult time.

I truly believe most companies are the same.....if word gets out that they deny claims and nobody will ever buy a policy from them again.

My advice....answer any questions they ask truthfully and err on the side of super-transparency.....ie. health history, past/present drug/alcohol use etc.


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## Money172375 (Jun 29, 2018)

james4beach said:


> These are great ideas; thanks! I love the idea of going directly to the competing giants. Their chance to win my business, love it.
> 
> As someone who deals with contracts in my professional work, it still blows my mind that people are supposed to sign up on verbal assurances. Sign up first then maybe cancel... yikes. That's highly manipulative and puts the buyer at a disadvantage.


As I said, I would expect the policy you buy will be exactly like the sample you provided. That is the contract. There might be some nuances with insurance that I didn’t experience in my role. Perhaps you are “applying” for the policy....(in that they want some health info in advance) and it is only then that they provide you a policy once they’ve agreed to accept you.....other it may be that the cooling off period is designed to protect you.

I suppose it happens quite a bit and I’m sure we can think of similar scenarios. When you get a new credit card, the terms and conditions are provided to you after you agree to buy. Standard terms can be provided but your name won’t appear on them.....and the legalese on a credit cards terms and conditions would rival an insurance policy. 

What else? Airline tickets? I’m sure the actual contract is available somewhere on the screen before I hit confirm.....but would I even understand the contents of what’s involved in my air travel. I’m sure there are others, but it’s probably a separate issue of consumer rights.

Ps. I did learn a couple of lessons buying cars. My dad bough a Honda 30 years ago and it came without the plastic Honda hubcaps. I asked my dad to get them as an option. They listed hubcaps on the invoice. Go to pick up the car, and they put on some generic hubcaps from Canadian tire instead of the genuine Honda bolt on covers. Second occurrence. I purchased a gm minivan and asked for cruise control as an option. They wrote dealer installed cruise control on the contract. Similar issue...they install a generic cruise control stalk on the side of the drivers column when I thought I was getting a genuine gm product similar to the factory installed units on the pricier models. Oh well. Live and learn.


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ^ ... isn't this kind of defeating what J4B is trying to do? Like "avoid" throwing $$$ away. OTOH, I would expect that's what a typical advisor (aka insurance salesperson) would say.
> 
> ...


I know what he is trying to do. I would think the overriding issue would be not to suffer the financial disaster that something like a brain injury would create, but what he is actually doing is trying to ensure that what he is reading is what he is reading. None of us and I doubt many of them can do much more then say the same thing. It is covered. Until he has a policy in force, however, he is NOT covered. That is the more important issue.

Lastly, although what he is asking sounds like a simple request, it is probably similar to me telling a car salesman that I want to speak to the guy that installs the steering wheel, on the production line in Tennessee to be sure it gets secured properly. It's not that the guy who does this job would not talk to me, but there is no system in place to make it happen and it would require about 4 internal conversations, with each person shaking their head in confusion, and uncertain how to proceed and very uncomfortable about it.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> I know what he is trying to do. I would think the overriding issue would be not to suffer the financial disaster that something like a brain injury would create, but what he is actually doing is trying to ensure that what he is reading is what he is reading. None of us and I doubt many of them can do much more then say the same thing. It is covered. Until he has a policy in force, however, he is NOT covered. That is the more important issue.


 ... right, and please have a look at the list of CI in post #12 that Rising Tide and tell me which "illness" would cover a "brain injury" (J4B's main concern) or as his post #30 states:



> ... My concerns are issues like injuries sustained during walking / hiking / cycling. According to my reading of the sample policy, they should be covered (and are not excluded) but want to hear how the insurer thinks about this. ...


I can't see any of them covering the "illness" caused by that injury other than perhaps "Paralysis". (Using common sense here). Now using "layman's" language of Wiki, one would see intent of CI with their definitions which seem to confirm that:https://en.wikipedia.org/wiki/Critical_illness_insurance. Now I'm not saying a CI policy is no good - only that its intent is to cover "critical (aka dread)" "illnesses (aka diseases)" such as cancer, heart attack, etc. or as per the policy's list. 



> Lastly, although what he is asking sounds like a simple request, it is probably similar to me telling a car salesman that I want to speak to the guy that installs the steering wheel, on the production line in Tennessee to be sure it gets secured properly. It's not that the guy who does this job would not talk to me, but there is no system in place to make it happen and it would require about 4 internal conversations, with each person shaking their head in confusion, and uncertain how to proceed and very uncomfortable about it.


...
So instead of it making it so complicated for J4B, I think he should simply ask the insurer (the insurance salesperson) the main question/his main concern "I sustain a brain injury while riding my bike", am I covered under the CI policy? [I would expect a "no" or maybe the Paralysis illness if the insurance person knows his/her own product. But then I wouldn't be surprised, J4B would be given another merry-go-around response because the product is so "complicated" or perhaps "I still don't know what the hxll I'm selling to the public".]


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## Beaver101 (Nov 14, 2011)

Money172375 said:


> Pretty much....sign up on whatever verbal assurances you’ve been given. You’ll be provided the actual policy which very likely has a cancellation period of 10-30 days where all premiums will be reimbursed if you decide to cancel. You could then take it to a lawyer. * When I sold CI, we were instructed to give clients a solid overview but if they had additional questions, we encouraged them to apply for coverage and then speak to an insurance advisor at head office during the cooling off period. *Don’t want to sound as though we neglected our duties, but when it came to detailed specifics beyond what was covered, for how long or for what cost...we deferred to the national call centre after the customer applied. (Keep in mind, I was selling creditor critical illness and was not licensed at all to sell other types of insurance - we were not insurance advisors)
> 
> Another no cost method could be.....purchase the policy and take the policy to a competitor and have them scrutinize the policy and ask them for their opinion on why their policy is “better”. Could say something like......”I’m into adventure sports....is there anything in this policy that would worry you compared to the policy you’re offering”. Nothing like getting a second opinion from manulife on a sunlife policy. If anyone will find something to critique, it will be their main competitor. Lol. Be sure this is also done during the cool-off period.


 ... funny enough, from this post and that of #36, not once did you mention what the smokey-side (or actual purpose) of the policies you were "encouraging" the clients to purchase. Yes, it's to payoff the client's mortgage or loan should he/she become incapacitated but it's "payable" to the bank only. The banks are the beneficiaries. And not to forget this blackmail, if you don't purchase the creditor insurance, you might not get the mortgage or loan with the bank.


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ... right, and please have a look at the list of CI in post #12 that Rising Tide and tell me which "illness" would cover a "brain injury" (J4B's main concern) or as his post #30 states:
> 
> 
> 
> ...


I did not read the policy, nor am I going to. It appears to be a little dry. If it is not listed it is not covered. If it is listed, it is covered. That is how it works and the point I was making is that is all anyone will really be able to do. 

Thanks for answering his question. I hope he sleeps better now.


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## Money172375 (Jun 29, 2018)

Beaver101 said:


> ... funny enough, from this post and that of #36, not once did you mention what the smokey-side (or actual purpose) of the policies you were "encouraging" the clients to purchase. Yes, it's to payoff the client's mortgage or loan should he/she become incapacitated but it's "payable" to the bank only. The banks are the beneficiaries. And not to forget this blackmail, if you don't purchase the creditor insurance, you might not get the mortgage or loan with the bank.


All banks and bankers are crooks and criminals...I get it. Since it was funny...I’ll continue the humour.

Having met with customers who’s family was dealing with cancer, I can tell you that they didn’t feel the bank was the beneficiary. Like in all my posts, I’ll reiterate that some products are a good fit for customers and some aren’t. Don’t take the word “encouraging” out of context. Would it feel better if I said “advising”? The reality is that most Canadians are vastly under insured and a tragic life event could be financially devastating. Our strategy was always based on customers making an informed decision. At no time in my 20+ years did I ever even hear a hint of the tied selling you are referencing. Irrespective of the challenges the banks (and most businesses) have with unethical activities, do you you really think these businesses are purposefully looking to deceive their customers? Don’t let the 1% of unethical employees (or the regular MarketPlace episodes) fool you. The vast, vast majority of advisors are hard working, ethical, honest, caring individuals helping customers through activities and planning that would rank far down their list of things to spend time on.


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## OptsyEagle (Nov 29, 2009)

Beaver:

I am not encouraging him to buy anything. I am just stating that if he suffered one of the items listed on the CI policy and he had one of those in force, he would be in a better position, then if he did not have a CI policy in force.

If I recall, when this thread started, my opinion was that he should take the disability insurance over the CI, but once he made his decision, I then focused on helping him with that. You do know I have no incentive, one way or the other, in his insurance quest. 

I assume you have owned some insurance in your life. Homeowners or Tenants or Auto Insurance for example. The person that sold it to you got paid to do so. Did that really make the insurance worthless? The same as not having it at all? Was all their advice and answers worthless to you?

You kind of remind me of an old girlfriend I had, many years ago for a few weeks. The boyfriend before me was a real creep and I am pretty sure my sole purpose, in her life at that time, was to prove to herself, that she was never going to trust a guy again. Not sure how that life turned out but obviously using one human experience to blanket a brush across all human experiences, is about as dumb as dumb can be.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Beaver:
> 
> I am not encouraging him to buy anything. I am just stating that if he suffered one of the items listed on the CI policy and he had one of those in force, he would be in a better position, then if he did not have a CI policy in force.
> 
> If I recall, when this thread started, my opinion was that he should take the disability insurance over the CI, but once he made his decision, I then focused on helping him with that. You do know I have no incentive, one way or the other, in his insurance quest.


 ... I didn't say you were "encouraging" him to buy anything. He's a big boy who is very financially savvy. And I get what you're saying on the latter, hence, my subsequent comment. I think we're on the same page on this. Just that I took the extra step of Wikki the product to "clarify" it somewhat since the industry is obviously not helping. 



> I assume you have owned some insurance in your life. Homeowners or Tenants or Auto Insurance for example. The person that sold it to you got paid to do so. Did that really make the insurance worthless? The same as not having it at all?


 ... That obviously would be a dumb question that's coming from you, very financially literate.


> Was all their advice and answers worthless to you?


 ... you make me laugh on this as the answer is an outstanding "yes!" There was no advice! Worst yet, should you ask a question (obviously pertaining to a claim scenario) on auto-insurance, be prepared for an increase on your premiums. 
.


> You kind of remind me of an old girlfriend I had, many years ago for a few weeks. The boyfriend before me was a real creep and I am pretty sure my sole purpose, in her life at that time, was to prove to herself, that she was never going to trust a guy again. Not sure how that life turned out but obviously using one human experience to blanket a brush across all human experiences, is about as dumb as dumb can be.


 ... aren't you doing the same here by making the same comparison? Are you that trusting? So I didn't "blanket a brush across all human experiences" as you don't know me nor do I know you. I'm merely trying to point out some truths and keep some people honest.


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## Beaver101 (Nov 14, 2011)

Money172375 said:


> All banks and bankers are crooks and criminals...I get it. Since it was funny...I’ll continue the humour.
> 
> Having met with customers who’s family was dealing with cancer, I can tell you that they didn’t feel the bank was the beneficiary. Like in all my posts, I’ll reiterate that some products are a good fit for customers and some aren’t. Don’t take the word “encouraging” out of context. Would it feel better if I said “advising”? The reality is that most Canadians are vastly under insured and a tragic life event could be financially devastating. Our strategy was always based on customers making an informed decision. At no time in my 20+ years did I ever even hear a hint of the tied selling you are referencing. Irrespective of the challenges the banks (and most businesses) have with unethical activities, do you you really think these businesses are purposefully looking to deceive their customers? Don’t let the 1% of unethical employees (or the regular MarketPlace episodes) fool you. * The vast, vast majority of advisors are hard working, ethical, honest, caring individuals helping customers through activities and planning that would rank far down their list of things to spend time on*.


 ... ya, ya, ya ... of course, no bias of a banker (or an ex-one).


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## OptsyEagle (Nov 29, 2009)

Beav. No one is ever 100% trusting. But at some point, in almost all matters, you will find yourself with a little less information then what you would prefer. At those times, you either trust someone or you suffer.

Use my ex girlfriend as an example. If you are a female and a hetrosexual, would your life truly be better by ensuring, no matter what, that no guy ever lies to you again, to the point that it literally drives them all out of your life, or perhaps you would be better off trusting many, enjoying the benefits they provide in your life but with the occasional disappointment.

Eventually J4B is going to get to a point where he either goes it alone, without insurance, or he trusts someone. As Money172375 stated above, most of the people are not out to take advantage of him. They obviously would like his business but most advisors will answer the questions truthfully. That does not mean they all will, but to avoid them all, for the sake of a few, would mean he would miss out on everything provided by people with incentive to provide it. That is way too much necessary stuff to avoid, in this world.

You do know that your question to the auto insurer was not what increased your premium. It was what the question pertained to that did that. If you were asking a question about something that increased your risk rating, then you have to admit, there is little difference between that and simply informing them of your increased risk level. Obviously you did not know that, but now you do.


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## james4beach (Nov 15, 2012)

Clarifying something: I did hear OptsyEagle and everyone's suggestions to look into disability insurance, and I looked into it. First I looked through my professional association and found that because I'm self employed, the payouts are severely capped at something like 18K per year. Their plan is pretty good, but it's not sufficient insurance for my needs; I'm not someone who struggles to pay my routine bills and I already have 18K a year extra. I also inquired into disability insurance through some other avenues, and found it was not competitive versus self insurance.

Based on that investigation I ruled out DI. Then I turned my attention towards CI, because it does have larger payouts and seems to better fit my needs, which is compensating me for longer term loss of income (ability to work) and potentially large/assistive medical costs, with payouts like 200K or even 500K.

So yes I am considering CI with a dual purpose, thinking of it as disability insurance as well. *Beaver's concerns are exactly why I am being very careful to learn what exactly this covers*. Beaver has voiced something that others have said, which is that it doesn't sound like CI "is intended" for things like major injuries sustained through accidents, car-bike collisions, etc.

I've heard the same response from others: no, CI can't be used like disability insurance. Then I look at the policy text and it's not clear to me why not, because the sample policy does not appear to exclude it. According to my reading of the policy, Sun Life doesn't seem to care which path led to the condition (like blindness or brain injury) as long as there wasn't alcohol, criminal actions, war, etc.

These are the things I'm trying to confirm before paying the big bucks. Different people have voiced very different opinions on whether CI is intended for what I'm thinking of.



OptsyEagle said:


> Eventually J4B is going to get to a point where he either goes it alone, without insurance, or he trusts someone.


Sure, but more realistically, I'll trust the Sun Life (or broker) to some extent, but make sure I can cancel the policy, and then use additional resources (Claims department, competing insurance, maybe a lawyer) to double check. I'm talking about an expensive policy here... my goal is not to replace 18K of income a year.


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## OptsyEagle (Nov 29, 2009)

Look. I understand what you want and I certainly understand the money you will be paying and I can't tell you what you should be concerned about and what you shouldn't be concerned about. That would be a very difficult debate to win, from my side. What I am saying is if you take a look at the long list of items covered, you should know that you have the ability to suffer almost all of them, like anyone else. Brain injuries caused by cycling would just be another that is either covered or it is not. Certainly try to find out but even if it was not covered, does it automatically exclude you from suffering the other conditions.

I can assure you there are lots of conditions that can keep you from working, cost you money, that are not covered in CI. You could contract the Corona Virus this week and it could knock you out of work for a year or more, and the CI plan would pay you absolutely nothing. I will add that the disability policy would kick in and pay you immediately, but I am not trying to dissuade you from one product to another. It is why the DI might appear to be less competitive as you say (MORE EXPENSIVE) but we can debate that later as well, if you like.

My point is if I were you I would do my best to understand the product, as best I can and from that understanding make a decision on its merits and value. Additionally I would know that some of that understanding will no doubt come from a commissioned or motivated sales person. That also cannot be helped in the world we live in.

Good luck. Let's hope you don't need any of it and hopefully it becomes a pure waste of premium money because the alternative, even with insurance, will really suck.


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## james4beach (Nov 15, 2012)

Thanks, this has all been very useful and I appreciate everything you've described. Do you know of any kind of DI provider that might be appropriate for self-employed with highly volatile income? I cannot show them stable long term income. I could make anywhere from 0 to 200K in a year.

I figure now is the time to shop for all of these because I don't have any medical conditions and thankfully am in top shape, under 40. There probably is no better time to buy.


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## Money172375 (Jun 29, 2018)

I don’t think they want to see or confirm your income. The policy amount you choose will drive the premiums. There are policies that cover life, DI and ci. In an earlier post, you talked about an advisor wanting to know your needs vs. Your desire to just have them explain a policy you’ve self selected. I’d recommend putting some faith in an advisor and allow them to take you through their needs analysis. It’s likely they have more experience and knowledge on more complex needs that you may desire. It’s free and you’ll probably learn something too. And doesn’t stop you from shopping around.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Beav. No one is ever 100% trusting. But at some point, in almost all matters, you will find yourself with a little less information then what you would prefer. At those times, you either trust someone or you suffer.


 ... quite the contrary. Why would I need the additional information knowing they're lies and suffer from that?



> Use my ex girlfriend as an example. If you are a female and a hetrosexual, would your life truly be better by ensuring, no matter what, that no guy ever lies to you again, to the point that it literally drives them all out of your life, or perhaps you would be better off trusting many, enjoying the benefits they provide in your life but with the occasional disappointment.


 ... duh. That's your one-sided "opinion" of her. Maybe the real reason she dumped you and the previous creep because neither of you were rich enough for her. 



> Eventually J4B is going to get to a point where he either goes it alone, without insurance, or he trusts someone. As Money172375 stated above, most of the people are not out to take advantage of him.


 ... I didn't say they were out to take advantage of him. That's your assumption. And as for that statement coming from Money172375, I'm not surprised he/she needs to justify him/herself or the "*vast, vast, majority* of ... " ...lol.



> They obviously would like his business but most advisors will answer the questions truthfully. That does not mean they all will, but to avoid them all, for the sake of a few, would mean he would miss out on everything provided by people with incentive to provide it. That is way too much necessary stuff to avoid, in this world.


 ... I'm sure them salespeople (advisors) would want his business, and would want to answer the questions truthfully when asked but how do you account for those who can't answer the questions? Simple yes or no .. no go beating around the bush or worst yet, spinning it.



> You do know that your question to the auto insurer was not what increased your premium.


 ... of course not.


> It was what the question pertained to that did that. If you were asking a question about something that increased your risk rating, then you have to admit, there is little difference between that and simply informing them of your increased risk level.


 ... it was a hypothetical question regarding a hypothetical claim scenario. Ie. getting clarification of coverage under that scenario. No claim was ever made. However, the insurance company took the opportunity to jump the gun, perceiving it as an elevated risk. 



> Obviously you did not know that, but now you do.


 ... yes, now I do. Never call an auto-insurer with any questions, particularly a "claims" question if you do not wish to see a 30% jump in your premiums for no factual reason (claims-free for decades). Obviously, the insurer has every explanation under the sun for that dramatic increase and it was not due to the call-in. And yes, I changed carrier as lesson learned.


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## OptsyEagle (Nov 29, 2009)

james4beach said:


> Thanks, this has all been very useful and I appreciate everything you've described. Do you know of any kind of DI provider that might be appropriate for self-employed with highly volatile income? I cannot show them stable long term income. I could make anywhere from 0 to 200K in a year.
> 
> I figure now is the time to shop for all of these because I don't have any medical conditions and thankfully am in top shape, under 40. There probably is no better time to buy.


They absolutely want to confirm your income. No income. No disability insurance.

In my experience they tended to take your last 2 years tax returns and used the after tax income from that. With the creative tax generation that can go on with a self employed individual, which efforts always were directed at lowering the income for taxes, it can not always give the truest picture, but it is all they have to go on. Knowing most self employed individuals probably earn a little or a lot more then what is stated on their tax return, they do cover a slightly higher percentage of self employed income as compared to employment income. If the two years are no where near the same, I am not sure what they do. Perhaps they average but possibly they take the low one, I don't really know/can't remember.

From that, the ones that offer the non-cancellable disability insurance, are all the same. Their concern here is not to OVER INSURE you. Their claims experience, for someone that is over-insured, is not good, as you can perhaps start to imagine. If you were disabled and you were receiving $4,000 per month of DI, how much motivation would you have to go back to work, if work only paid $3,000 per month. It's not easy to make up a false excuse to get your DI benefits to start paying but once you are on claim, it is not all that difficult to make stuff up, to remain on claim. The amount of money these guys are insuring is very large. Usually way more then CI and life insurance, etc., in most cased, if the claim continues until age 65 for someone they have covered.


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ... quite the contrary. Why would I need the additional information knowing they're lies and suffer from that?
> 
> ... duh. That's your one-sided "opinion" of her. Maybe the real reason she dumped you and the previous creep because neither of you were rich enough for her.
> 
> ...


Thanks for updating all that Beav. Your anger has been noted. To test your theory, you could simply go to another insurer. If you are right, and don't ask those questions about claims (now that you have your answers), your premiums should go back down with the new insurer. I bet they don't, but you should give it a try.


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## Beaver101 (Nov 14, 2011)

^ Again, another of your false assumption. Why would I be angry and about what?


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ^ Again, another of your false assumption. Why would I be angry and about what?


Take a look in the mirror. You are definitely missing what we are seeing. You blanket every advisor as the same, not just on this thread but on every thread. That obviously cannot be the case. Even when I suggested he buy a policy that is offered by advisors, you attacked it. I assume that was your problem with my suggestion, but perhaps I was wrong. If I read you wrong, I apologize, but since I did and I know others have taken your attitude the same way, you might want to adjust the way to make your points in the future. Facts are a lot more useful then emotion.


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## Money172375 (Jun 29, 2018)

Hmmm...good to know...I need some education here.....why do they care? Are they worried about premiums not being paid? I Figured you could just ask for a policy, for example that will pay $5000 a month for up to 24 months if a disability is proven.

I wonder if folks have a hard time confirming income for insurance purposes in a similar way people have difficulties proving income for mortgages.


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## james4beach (Nov 15, 2012)

I doubt the insurer will care much about my last 2 years of taxes, which were under an employer that I am no longer with. Maybe I'm wrong... do they only care what the tax returns say? I can show them tax returns with 2 years of high income. IMO not relevant to my income going forward but maybe they don't think that way.

And you guys are talking 4K to 5K a month disability but even my professional association's insurance would pay nothing near that. The professional association quoted me a policy with max $1500 a month (due to self employment) which is why I figured DI is out of the picture.

Not to mention the fact that DI can be turned off once the insurer determines you're good enough to work. The benefit I see with CI is the lump sum payout, meaning you can rest and recover on your own schedule... not the insurer's.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Take a look in the mirror. You are definitely missing what we are seeing. You blanket every advisor as the same, not just on this thread but on every thread. That obviously cannot be the case.


 ... perhaps you should too as that's your perception. You do realize "every" "advisor" is inherently biased and there are some who are not so honest. (And please, I'm not saying it's you.) So I'm merely pointing this out - not sugar-coating it. Or being labelled as "naive". Also, who is the "we" (other than Money###)?



> Even when I suggested he buy a policy that is offered by advisors, you attacked it.


 ... again, your perception. What's wrong with pointing out some pitfalls in a getting a policy that doesn't meet J4B's needs? How did I attack your suggestion? 



> I assume that was your problem with my suggestion, but perhaps I was wrong. If I read you wrong, I apologize, but since I did and I know others have taken your attitude the same way, you might want to adjust the way to make your points in the future. Facts are a lot more useful then emotion.


 ... yah, I think you're wrong or perhaps having the wrong perception(s). And I agree facts are more useful as presented in my post #43 rather than your analogy of your fall-out with your ex-girlfriend.


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## OptsyEagle (Nov 29, 2009)

Money172375 said:


> Hmmm...good to know...I need some education here.....why do they care? Are they worried about premiums not being paid? I Figured you could just ask for a policy, for example that will pay $5000 a month for up to 24 months if a disability is proven.
> 
> I wonder if folks have a hard time confirming income for insurance purposes in a similar way people have difficulties proving income for mortgages.


It has similarities. Both really, really want to sell their products, but with DI, they believe that as a group, it would be sold for a loss, if they "over-insured" that group. It is what it is. It makes sense. No one wants to sell a product at a loss. Mortgage or Insurance. Even though the premiums are large, the monthly benefits for a workers lifetime, is a magnitude larger. Work motivations play a very big role in the profitability of DI and all this comes from past claims experience.

They have all the numbers from claims, because although they will not insure a person above their income level. That insured person can have an income reduction, in the future, and no change can be made to the policy. So in effect, at that time, that individual would be over-insured and would not be their best customer at that time, but it is "non-cancellable" insurance and they cannot do much about it. If he/she goes on claim, they have to pay the full amount of what they contracted for. So they do all they can during the underwriting to protect themselves from this.

I should add, that above I said they take the last two years tax returns (CRA's NOA) to determine income, which they do. I said I was not sure whether they would average them or insure based on the lowest amount in the two years. Although, I still don't know, I would guess they would lean towards the average. It is all about motivation of the insured to work. That is what they want to see. A person, especially J4B will look at their average earnings for the benefit their occupation provides and from that, they will derive all the motivation that is possible from it. So my best guess, is they will use the average income for underwriting disability insurance. CI, they could not care less about income because there is no ongoing loss or reduction in loss. If a person qualifies for a CI claim, the claim is paid, the contract is done. Incomes do not play any role in it, so if one is declined for DI or does not get the amount of coverage they feel they need, CI is a good alternative. May even be better, that would be in the opinion of each person.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I doubt the insurer will care much about my last 2 years of taxes, which were under an employer that I am no longer with. Maybe I'm wrong... do they only care what the tax returns say? I can show them tax returns with 2 years of high income. IMO not relevant to my income going forward but maybe they don't think that way.


 ... it's simple. They need verification or proof, like everything else. If your policy is a % of your income, then your claim is also based on that. They're not going to pay you a cent more nor are you going to insure (aka pay your premiums) a cent more than you're getting.



> And you guys are talking 4K to 5K a month disability but even my professional association's insurance would pay nothing near that. *The professional association quoted me a policy with max $1500 a month (due to self employment) *which is why I figured DI is out of the picture.


 ... in this case, you're insured for a flat amount regardless of your income. But then the insurer would still want proof your income (likely your last 2 years or the most recent T4 reported) supports that amount. Ie. if you just made $12K last year, then why should they be paying you $1,500 a month x 12 = $18K? Anyhow, I think definition of earnings in the policy dictates.



> Not to mention the fact that DI can be turned off once the insurer determines you're good enough to work. The benefit I see with CI is the lump sum payout, meaning you can rest and recover on your own schedule... not the insurer's.


 ... obviously, DI means disability income ... income replacement due to a disability meaning if you can return to work (getting an income), then you don't need the income replacement coverage.


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## OptsyEagle (Nov 29, 2009)

james4beach said:


> I doubt the insurer will care much about my last 2 years of taxes, which were under an employer that I am no longer with. Maybe I'm wrong... do they only care what the tax returns say? I can show them tax returns with 2 years of high income. IMO not relevant to my income going forward but maybe they don't think that way.
> 
> And you guys are talking 4K to 5K a month disability but even my professional association's insurance would pay nothing near that. The professional association quoted me a policy with max $1500 a month (due to self employment) which is why I figured DI is out of the picture.
> 
> Not to mention the fact that DI can be turned off once the insurer determines you're good enough to work. The benefit I see with CI is the lump sum payout, meaning you can rest and recover on your own schedule... not the insurer's.


If it was the same industry/occupation, I would imagine it would be relevant, if completely different you may have a problem. You never really know until you apply. As for the amounts. I cannot comment on the Association plan you cited, perhaps they have a maximum for some unique reason for them. Lower maximums would allow for lower premium per dollar insured, for the motivational reason I have already mentioned. I do know for sure, that they are willing to insure up to 85% of your after tax income. Maximums for individual plans are usually in the $20,000 per month area, if I recall and might vary depending on the insurer.

Not sure what Beaver was getting at, but once you have a contract inforce, your current income becomes irrelevant at claims time, except if you have "residual disability", which is a rider that protects you against partial disability where you are still working but suffered a reduction in your income. They need some baseline to determine how much reduction took place. Other then that, they don't care. If your doctor says that you cannot perform the substantial duties of your regular occupation, they will pay you the full monthly amount that you contracted for. Your income just before that is not taken into account, at that time.


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## OptsyEagle (Nov 29, 2009)

I should add, when you were told that the association plan had a maximum of $1,500 per month, was that information from the insurer or did you get that from a co-worker that had applied for it? The reason I ask, is with disability insurance Association plans are almost identical to Individual plans, in that they are individually underwritten and usually offer the same benefits, etc. If it was a co-worker I might think that they had applied for a larger amount and were told that due to past income levels, the most that person could be insured for was $1,500 per month, and they might have taken that result as a maximum for everyone, when it may not have been.


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## james4beach (Nov 15, 2012)

That info I had was from the insurer based on a quote for me. They got all my details, age, income level, etc and then gave me that quote. It was when I mentioned self employment that the answer changed dramatically... so this has nothing to do with coworkers. My coworkers actually have better coverage, but this particular group plan sets lower $ amounts for self employed.

I still don't get the sense that DI is the correct policy for me. I'm semi retired at this point, and don't need a lot of employment income. I only work because it's kind of fun and further bolsters my financial situation. If I were to become injured or disabled there is, in fact, not much motivation to work and I can even say that now as a perfectly healthy person. If I was injured I would probably really want to rest and take it easy until I get back on my feet, not rush back to work.

If I had a heart attack for example, I guarantee you that I would take it really easy for a very long time and make sure to get excellent treatment. I would really focus on my health. I barely need to work to begin with... why would I rush back into the rat race? No. I would focus on myself for a long time. Eventually when I'm feeling up to it, I would do some minimal amount of work.

Doesn't seem like a fit for DI since the focus appears to mainly be on short term replacement of income (paying monthly bills) and the insurer wants to see people who are motivated to get back to work. I would only be interested in DI for long term disability reasons; I don't even care about short term income loss.


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## james4beach (Nov 15, 2012)

More to the point, our professional association group plan sounds quite good overall (coworkers like it) but the fact they can't cover much DI suggests to me that DI is a dead end for me. The last thing I want to do is start dealing with a fleet of salespeople for no reason. I already had another insurance broker look at my situation and tell me: "quite honestly, DI is going to be very expensive for you"


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## OptsyEagle (Nov 29, 2009)

No problem. It is an individual issue and decision. I like DI because it kind of seperates out why you were disabled and just pays because you are disabled. You can relate it directly to income loss when trying to figure out the exact need, etc. The problem I have with CI is that some of the things they cover would cost you a fortune, if you were unlucky to get them and others would not cost you anything. Some might not even keep you away from work. It seems like more of a gamble then something that is designed to protect, where the insurance company knows the odds of that gamble much better then you do.

That said, $1,500 per month, would not do too much to replace your income and would do virtually nothing to pay for things that would help you enjoy life a little better if you were paralysed or something really ugly like that. If I thought critical illness insurance was no good at all I would have led with that in my points. It is a fine product and perhaps in your case it might even be better.

It also sounds like you are already self insured, which is the best way to deal with the need for income protection and perhaps all you really need is some compensation to deal with any added expenses that some disabilities would create.


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## james4beach (Nov 15, 2012)

Happy to consider DI if I actually found more significant payouts (to really help with medical treatment), from an insurer that isn't so caught up on what my current income level is. I don't even know _my own_ income level. It just doesn't matter to me because I expect it will average out to something reasonable over the years.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> If it was the same industry/occupation, I would imagine it would be relevant, if completely different you may have a problem. You never really know until you apply. As for the amounts. I cannot comment on the Association plan you cited, perhaps they have a maximum for some unique reason for them. Lower maximums would allow for lower premium per dollar insured, for the motivational reason I have already mentioned. I do know for sure, that they are willing to insure up to 85% of your after tax income. Maximums for individual plans are usually in the $20,000 per month area, if I recall and might vary depending on the insurer.
> 
> *Not sure what Beaver was getting at, but once you have a contract inforce,* your current income becomes irrelevant at claims time, except if you have "residual disability", which is a rider that protects you against partial disability where you are still working but suffered a reduction in your income. They need some baseline to determine how much reduction took place. Other then that, they don't care. If your doctor says that you cannot perform the substantial duties of your regular occupation, they will pay you the full monthly amount that you contracted for. Your income just before that is not taken into account, at that time.


 .. it is okay you don't get what I'm getting at. But when I read your post here, 2nd paragraph, it's rather contradictory. On one end, you're saying verification (consideration) of income doesn't matter. And yet if you go back part-time, you get the "residual" "rider (aka you pay extra for, correct?)" coverage so does that mean you get the full amount of $1,500 or the part-time coverage of $750 (or whatever lower)? 

As I'll re-iterate from my post #64 above "_Anyhow, I think definition of earnings in the policy dictates._" .... simply meaning the insurer will dictate the terms as per their policy, including occupations and clawing back your full coverage amounts. Ie. even you qualified for $10,000 per month, they'll want to claw that back via other income means (pensions, etc. as per their policy). It would have been nice if these other criterias/flipside were identified. But then again, I guess that's why some of us are on this forum trying to DIY on our finances, hopefully able to help others.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> Happy to consider DI if I actually found more significant payouts (to really help with medical treatment), from an insurer that isn't so caught up on what my current income level is. I don't even know _my own_ income level. It just doesn't matter to me because I expect it will average out to something reasonable over the years.


 ...I would agree. Paying a claim is the key ... don't take my word - google the internet and alot of PITA stories pop up.


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## OptsyEagle (Nov 29, 2009)

Beav. Please for the original poster. Stop guessing at this stuff. It's a lot of money the OP is allocating and Individual Disability Insurance does not always work the way you guess it does. The basic monthly benefit certainly does not offset against pension income or investment income for that matter. It doesn't even offset against residual work income, for example, if a person was receiving royalties on software sales or something like that. It only cares whether you are still working or not.

As for their interest in his previous income at claims time, I think I explained the difference between just a basic plan and one with residual disability as an additional rider, quite well so I will leave that alone.

As for the internet. The only stories you are going to find are the negative ones. I don't think anyone would assume there would not be some problems, now and then, and hopefully they would understand that not all of those problems would not have originated from the insurance company.


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## OptsyEagle (Nov 29, 2009)

I should make one clarification to my post above. DI insurance does not offset against other income with one exception, if my memory holds up. CPP disability benefit. I believe they do offset against that income for two reasons. First, they cannot accommodate that income, during underwriting, because as many of us know, it has a very stringent definition of disability and much more stringent then what is found in an individual DI policy. Since a person may be disabled, from the individual policy definition and still not receive CPP disability, they ignore it when determining the maximum benefit they will offer, but add a clause stating that if you do receive it, your DI benefits within the policy will offset dollar for dollar.

The 2nd reason is as I have stated before. They are desperately trying to make sure someone who they insure will not be over-insured. They try very hard to make sure that you will not earn more money staying on disability benefits then you would if you went back to work. For this reason they do not offset against investment income, CPP retirement pension, regular pensions, etc., because you would get all those whether you went back to work or not.

Any income that would go away when you go back to work, is a demotivating factor that they need to reduce as much as they can, if they want a person to try to go back to work. For some reason, when a person is about to lose money, when they go back to work, they have a large motivation to avoid it. 

The Universal Basic Income promoters should try to learn something from the insurance companies experience. They know this so well, they are willing to forego business because of this relationship.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Beav. Please for the original poster. Stop guessing at this stuff. It's a lot of money the OP is allocating and Individual Disability Insurance does not always work the way you guess it does. *The basic monthly benefit certainly does not offset against pension income or investment income for that matter.* It doesn't even offset against residual work income, for example, if a person was receiving royalties on software sales or something like that. It only cares whether you are still working or not.


 ... who said the DI is offseting the pension? It's the pension(s) (meaning RRSP, private pension, CPP and more) that can offset the coverage. You got it the other way around so why don't you stop the "guessing" or supposedly offering your expertise. Or maybe outline the policy terms or the "facts" instead of accusing others of guessing.



> As for their interest in his previous income at claims time, I think I explained the difference between just a basic plan and one with residual disability as an additional rider, quite well so I will leave that alone.


 ... unless J4B responds to this, you're just assuming you explained the difference.



> As for the internet. The only stories you are going to find are the negative ones. I don't think anyone would assume there would not be some problems, now and then, and hopefully they would understand that not all of those problems would not have originated from the insurance company.


 ... if the problem is not with the insurance company not paying, then why don't you offer a "positive" story then. Because I don't have one - in fact, my friend went through hell trying to get an LTD claim paid.


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## james4beach (Nov 15, 2012)

OptsyEagle said:


> It also sounds like you are already self insured, which is the best way to deal with the need for income protection and perhaps all you really need is some compensation to deal with any added expenses that some disabilities would create.


I am thinking along these lines, yes.


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## Eclectic12 (Oct 20, 2010)

Beaver101 said:


> OptsyEagle said:
> 
> 
> > ... As for the internet. The only stories you are going to find are the negative ones. I don't think anyone would assume there would not be some problems, now and then, and hopefully they would understand that not all of those problems would not have originated from the insurance company.
> ...


One positive and one that it was work but was ultimately positive in this article. https://www.theglobeandmail.com/glo...l-illness-insurance-worth-it/article28195723/

The first time I heard of CI insurance was a positive only article but it's now showing as the bias is to more recent articles with a lot being a mix of advisors comments with a summary of critical comments.


Cheers


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## Beaver101 (Nov 14, 2011)

^ That's CI ... try finding a positive one on LTD or DI. Good luck.


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ^ That's CI ... try finding a positive one on LTD or DI. Good luck.


When the benefit is paid on time, people rarely complain.

Nothing surprising in the article. My aversion to CI is simply the fact that they are a little too specific on what constitutes a claim. A claim which has no direct relationship to need or income. 

That said, the individuals that suffered those specific ailments are obviously quite happy they had the coverage. Perhaps they may have preferred the claims experience to have gone better but I doubt they regretted buying the policy.


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## Eclectic12 (Oct 20, 2010)

Beaver101 said:


> ^ That's CI ... try finding a positive one on LTD or DI. Good luck.


I have both good (previous LTD provider) and bad (new LTD provider) from the same co-worker.


Cheers


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> When the benefit is paid on time, people rarely complain.


 ... you're too funny. The complaint is not about being paid "on time"...just start with being "paid" at all.



> Nothing surprising in the article. My aversion to CI is simply the fact that they are a little too specific on what constitutes a claim. A claim which has no direct relationship to need or income.
> 
> That said, the individuals that suffered those specific ailments are obviously quite happy they had the coverage. Perhaps they may have preferred the claims experience to have gone better but I doubt they regretted buying the policy.


 ... again, the contradiction here. Of course, the individuals who qualified for the CI claim would not have regretted buying it as that insurance served their need and CI would not have any relationship to income as it's not "income" dependent. That would be DI. You do know they're different products or the difference between the 2 ... after all these posts.


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## Beaver101 (Nov 14, 2011)

Eclectic12 said:


> I have both good (previous LTD provider) and bad (new LTD provider) from the same co-worker.
> 
> Cheers


 ... in the claims sense or what? I'm talking from a claimant's point, not the provider or advisor. And I can't see your co-worker having 2 LTD "claim" providers.


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## OptsyEagle (Nov 29, 2009)

Beav. we all get your point. If you own insurance and don't get paid a claim, when you think you should, you will be upset and you will most likely try to tell everyone. The easiest way to do that today is on social media.

The problem is that these people did not buy the insurance because they thought it was something they always wanted to own. They bought it because they needed it. If you look at how many people own insurance and how many claims are applied for each and every year, you have to imagine that a few people will always end up being declined. Without the knowledge of why that is, the fact that they are upset about it, does none of us any good. I mean if someone asked me a question about whether a claim would be accepted or not, all I could do is give my opinion and in almost every case I would say, it never hurts to submit a claim.

I think J4B is quite aware of this potential issue so unless you have something helpful to add, please quit mis-understanding my posts and replying to them. It is becoming tiring.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Beav. we all get your point. If you own insurance and don't get paid a claim, when you think you should, you will be upset and you will most likely try to tell everyone. The easiest way to do that today is on social media.


 ... it's not me. It's my (close) friend who went through hell to get the claim paid. As I mentioned previously, don't take my words for it, google it. Fortunately, social media isn't just for one-sided fairy tales-telling nor free and false marketing.



> The problem is that these people did not buy the insurance because they thought it was something they always wanted to own. They bought it because they needed it.


 ... obviously then what's insurance for? Why bother even to have insurance companies (other than to make profits, we get this too.) 



> If you look at how many people own insurance and how many claims are applied for each and every year, you have to imagine that a few people will always end up being declined.


 ... how do you know it's a few? Do you have the stats to back it up? 



> Without the knowledge of why that is, the fact that they are upset about it, does none of us any good.


 ... well, that's what social media is there. We can also be thankful for programs like CBC's Go Public ... otherwise, all the dirt gets hidden. 



> I mean if someone asked me a question about whether a claim would be accepted or not, all I could do is give my opinion and in almost every case I would say, it never hurts to submit a claim.


 ... you're not qualified to determine a claim is accepted or not and besides, if you did pay for the premiums or "bought" the insurance as it's intended for (protection), then why wouldn't you submit the claim? 



> I think J4B is quite aware of this potential issue so unless you have something helpful to add, please quit mis-understanding my posts and replying to them. It is becoming tiring.


 ... of course, J4B is aware of the potential issues at this point as he has determined to self-insure. And I haven't misunderstood your posts - I'm only replying because your posts are misleading. If you're trying to be warm and fuzzy, I can offer you my cat's mat to hold. 

And if you're tired of reading, then I suggest you stop posting first.


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## Eclectic12 (Oct 20, 2010)

Beaver101 said:


> ... in the claims sense or what? I'm talking from a claimant's point, not the provider or advisor ...


Employee that went out on LTD twice.




Beaver101 said:


> ... And I can't see your co-worker having 2 LTD "claim" providers.


You've never heard of an employer changing benefits providers over time?

The first LTD leave was easy according to my co-worker with one LTD provider.

He was then back at work for years, during which benefits providers, including LTD changed.

The second LTD he lodged a complaint with HR as he didn't appreciate being at home, spaced out on medication and having the LTD rep basically telling him he was okay to work, why wasn't he back at work and if he wasn't back at work tomorrow, his LTD claim would be canceled.


Cheers


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## james4beach (Nov 15, 2012)

I've decided to self-insure DI but still am considering CI.

And yes I am aware that they only cover a specific set of illnesses, and many things are excluded and wouldn't qualify as insurable. I am just thinking about this and trying to understand the big picture, to get a sense of what the insurance is worth to me. I'll give you a rough idea ... if I could get a 500K payout policy on a list of illnesses/injuries that I think sounds pretty comprehensive, and such a thing only cost me $1,000 per year in premiums, I'd probably do it. It would be just about impossible to self insure and 500K payout would far exceed what I could accumulate myself into a "health reserve fund"... even if I account for 50% chance of the insurer paying out.

Self insuring by building up extra savings, instead of going with CI, does seem possible but I suspect there is also a psychological element. Even if I have well in excess of 500K savings, I could imagine I might try to scrimp and save on expenses in the name of preserving my wealth. The CI payout provides a lump sum which will be easier to actually spend on medical needs. This could be an advantage, versus asking myself to pay big expenses out of my own savings.

So I think there's a psychological advantage of "separating out" the health reserve fund (turning it into a CI payout) from my own personal savings especially when talking about seriously large expenses. Of course, then one has to consider the probability of getting money from CI at all, and that's where I hope to use my general judgement in weighing those things.

I think that 10 or 15 years from now, I'll probably be wealthy enough to self insure for CI.

Am I correct in understanding that CI payouts are not inflation adjusted?


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## OptsyEagle (Nov 29, 2009)

Beaver101 said:


> ... it's not me. It's my (close) friend who went through hell to get the claim paid. As I mentioned previously, don't take my words for it, google it. Fortunately, social media isn't just for one-sided fairy tales-telling nor free and false marketing.
> 
> ... obviously then what's insurance for? Why bother even to have insurance companies (other than to make profits, we get this too.)
> 
> ...



Where to start with you. Seeing the stats for claims is not necessary. I doubt it is on the internet because if it was you would have posted it yourself. This is your point, not mine. Forget I said they would pay a claim at all. Again, you are very tiring. We know there are going to be declines, before we even investigate it, simply from the lack of understanding in these products. To go find out that they exist is pointless. 

You need to understand that there is so much money in a claim that if a benefit was actually merited these people would be talking to a lawyer, not a bunch of random people,who could care less, on the internet. The lawyer would not even ask for a fee but only a percentage of the benefit paid. 

The other more important point was that we don't have much choice. In the world we live in, at times, we need to buy insurance. That was my point. It is a risk we have to take. So whining on about this friend of yours or the angry people on the internet does no one any good. If that is all you have to add, you can stop. You've done a great job pointing that out. We got it. Thanks.


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## Beaver101 (Nov 14, 2011)

Eclectic12 said:


> Employee that went out on LTD twice.


 ... are you certain it's LongTD and not ShortTD because being able to go on LTD (aka paid for) twice is like winning the lottery jackpot.



> You've never heard of an employer changing benefits providers over time?
> 
> The first LTD leave was easy according to my co-worker with one LTD provider.
> 
> He was then back at work for years, during which benefits providers, including LTD changed.


 ... yes, it's all possible. But then I'm surprised the 2nd carrier would paid if the insured had already claimed an LTD, even with another provider and is of a different disability. 



> The second LTD he lodged a complaint with HR as he didn't appreciate being at home, spaced out on medication and having the LTD rep basically telling him he was okay to work, why wasn't he back at work and if he wasn't back at work tomorrow, his LTD claim would be canceled.
> 
> Cheers


 ... and so what does this mean? Someone legitimately disabled is not only threatened who paid for insurance that is not being honoured as per the insurance contract. Hmmm ... is this how that business is supposed to work?


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## Beaver101 (Nov 14, 2011)

james4beach said:


> ... Am I correct in understanding that CI payouts are not inflation adjusted?


 ... correct. Payment is a lump-sum and $500K is ALOT of insurance with alot of that requiring medical evidence (aka medical examination, tests, not just questions).

Re the notion of DI/LTD being "inflation" adjusted, you have to pay extra for that. It's not a freebie.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Where to start with you. Seeing the stats for claims is not necessary. I doubt it is on the internet because if it was you would have posted it yourself. This is your point, not mine. Forget I said they would pay a claim at all. Again, you are very tiring. We know there are going to be declines, before we even investigate it, simply from the lack of understanding in these products. To go find out that they exist is pointless.


 .. you don't have to re-start with me as you already did. If you find me tiring, then I repeat don't read my posts and respond. But then you can't because you know I'm telling the truth. I'm unable to elaborate on my friend's case for privacy reason, hence, I cited about checking the internet for all the horror stories. But then you go sugar-coating that the internet is only full of "negative" stories as you can't give even one positive one to counter my argument. Which is okay with me as most of us, not in the industry, knows just how inherently biased those who are. 




> *You need to understand that there is so much money in a claim that if a benefit was actually merited these people would be talking to a lawyer*, not a bunch of random people,who could care less, on the internet. The lawyer would not even ask for a fee but only a percentage of the benefit paid.


 ... bingo, right from the horse's mouth. 

*The industry's practice is "all claims" has "no merit".* If your claim is to be "ever" paid, you would need to be first sent to the ringer, or find yourself a lawyer "to have any merit". All in the midst, the insured is sick, disabled and financially-lacking. Is this how insurance works? Sounds very much like it so thanks for the validation.




> The other more important point was that we don't have much choice. In the world we live in, at times, we need to buy insurance. That was my point. It is a risk we have to take.


 ... ya, obviously, an additional risk. You paid for false protection.



> So whining on about this friend of yours or the angry people on the internet does no one any good. If that is all you have to add, you can stop. You've done a great job pointing that out. We got it. Thanks.


 ... why are you so insistent that I stop opening the pandora box? Scare of the truth or is your job on the line?

Like I said previously, I'll only stop posting if you stop responding/posting.


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## OptsyEagle (Nov 29, 2009)

Thanks for the advice. I will stop reading your posts. It is a two way street. You either also have to stop reading mine or at least stop mis-reading mine.


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## Beaver101 (Nov 14, 2011)

OptsyEagle said:


> Thanks for the advice. I will stop reading your posts. * It is a two way street. You either also have to stop reading mine or at least stop mis-reading mine.*


 ... agree and same to you.


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## Eclectic12 (Oct 20, 2010)

Beaver101 said:


> Eclectic12 said:
> 
> 
> > Employee that went out on LTD twice.
> ...


LTD kicks in at four months where the employee was talking about six months or longer.




Beaver101 said:


> ... yes, it's all possible. But then I'm surprised the 2nd carrier would paid if the insured had already claimed an LTD, even with another provider and is of a different disability.


The employee most were talking about went off on LTD for something like three times, at least a year at a time with the same disability.

I have no idea if other employers are signing up for LTD that somehow limits employees to a single LTD claim, whether the LTD provider is the same or not. The employers I have worked for have usually allowed multiple LTD claims. The limitation I have seen is where too long LTD with multiple LTD claims have translated to the particular employer being declared redundant or similar by management.




Beaver101 said:


> Eclectic12 said:
> 
> 
> > ... The second LTD he lodged a complaint with HR as he didn't appreciate being at home, spaced out on medication and having the LTD rep basically telling him he was okay to work, why wasn't he back at work and if he wasn't back at work tomorrow, his LTD claim would be canceled.
> ...


It means that if the LTD provider had been able to intimidate the employee into going back to work, the LTD payments would have stopped.




Beaver101 said:


> ... Hmmm ... is this how that business is supposed to work?


Is business supposed to declare redundant an employee with 20+ years with the company that has a heart attack at work where an new posting has the same responsibilities, same staff reports, same salary range but a different title?


Basically, it's a wide range out there where some have smooth experience, some have to do some work but don't have it that bad, some have a rough time and some have to resort to lawyers.

Cheers


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## OptsyEagle (Nov 29, 2009)

Group insurance is underwritten completely differently then individual insurance. That is why an employee can go on LTD quite a few times. With individual DI, the insurer would see that pre-existing condition, during underwriting, and would exclude it or decline the policy entirely. With group, as most of us should be aware, there is no medical underwriting for the basic group plan. All employees are eligible. 

The insurer deals with the risk of pre-existing conditions, in group plans, in two ways: 

1)First, they assume some people in just about every employee group will have some pre-existing conditions. This is dealt with by the fact that even the very healthy are required to join as well. So the insurer just costs it out accordingly and deals with pre-existing conditions that way. The easy money they make on the healthy employees goes towards paying the increased cost of the less healthy ones.

2) Secondly, the premium for group insurance is not guaranteed for the life of the policy, as it is with individual insurance. It is reviewed every year. So if the insurer sees a bad claims experience with their group customers, they simply raise their price to account for it. The employer either pays this amount or cancels the insurance. Either way, the pre-existing conditions don't have the same detrimental effect on the insurance industry as they would with individual policies, where the price is guaranteed for the life of the policy.


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## james4beach (Nov 15, 2012)

Wow, there's no inflation adjustment on something like 500K of CI policy? That's a big factor in the math. While 500K is a big amount for me today (I don't have a spare 500K sitting around), in 10 years @ 3% inflation this erodes considerably. And it's very reasonable to think that medical costs would increase at least at that inflation rate.

This suggests to me that if I ever got a policy like this, I probably only need 10 years of coverage. After that, inflation has knocked down the value of 500K significantly, to the point where I can self insure. I can't imagine that someone would buy a CI policy for, say, 25 years. Wouldn't even mild inflation make the payouts useless?

Question for Optsy and others who know about insurance... if the insurer does offer an inflation-adjustment option, is it typically over-priced or fairly priced?


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## OptsyEagle (Nov 29, 2009)

Almost always over-priced unless it is just a direct annual increase to the plan. In other words if it is a 2% or 3% annual increase, they price it accordingly, but if it is indexed to CPI, they will need to add a risk factor to the pricing, to pay for that unlikely weird inflation event. Since that risk payment has no direct value it appears as over-valuation of this rider.

Disability Insurance offers some increasing benefit riders, as well as annuities, but I have not heard of it in CI.

Keep in mind, that anytime I ever saw it quoted, I would do what I suspect anyone would do. I compare the indexing price to how much benefit one might get without indexing. For example, if $100,000 of benefit, with a 3% annual increase was $1,600 per year, and the same benefit without inflation protection was $1,100 per year, then it is fairly accurate to say that $1,600 could buy $1,600/1,100 x $100,000 = $145,000 of non-inflation protected benefit.

Fairly quickly, the prospective customer who understands simple math, is going to stop worrying about a claim happening many years from now, and start worrying about a claim happening 1 or 2 years from now. If they took the inflation protection, they would only get approximately $106,000 of benefit, if their issue happened in 2 years and they could have bought $145,000 of regular protection, for the same amount.

The above numbers are just a made up example but what it show is that there is never a clear answer, since that answer will be determined by the future, which is anything but clear. So, even if they have inflation protection, I have found that very few people ever buy it. Not because they will never need it, but because of the uncertainty of when a claim will take place and the effort one puts into making sure they cannot blame themselves for buying the wrong policy and/or feature.

In my experience inflation adjustment is usually perceived as too expensive, when it is available.


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## james4beach (Nov 15, 2012)

OptsyEagle said:


> In my experience inflation adjustment is usually perceived as too expensive, when it is available.


Could that be because we've had very low inflation for 30 years?


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## OptsyEagle (Nov 29, 2009)

james4beach said:


> Could that be because we've had very low inflation for 30 years?


That would be part of it. As I said, anytime they offered complete indexing to CPI is was rediculously priced, due to the uncertainty of the cost of that to even the insurance company. If it was 2% annual or 3% annual, then the customer had two things to think about. Would those amounts deal with inflation. Well, we can never know, so the answer is no. 2nd, they can directly relate the cost of it to its benefit. Since $1 paid by an insurance company usually is priced the same as any other dollar paid, that part was a wash. So the customer now had to decide, if there was no deal one way or the other and I have a choice of a big benefit now or later, they almost always take it now. That would mean going with inflation protection. That is how I saw it usually go.

With DI it requires two riders, that does not help the clarity of the policy any when one needs to explain them. To be fully protected you would need the indexing of the protection before you are on claim and of course, you need the indexing of the benefit while you are on claim. The first one will be called something like a "guaranteed insurability" rider and the 2nd one will be an "increasing benefit" rider. The 1st one says that on certain anniversaries, you would have the right to increase the benefit by a certain amount without having to prove medical insurability. You would need to prove that your current income justified the new amount. As I said, they will do everything they can to make sure you are not over-insured, in any way.

Again, all of that tends to end up as a "when in doubt, leave it out" kind of ending.


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## james4beach (Nov 15, 2012)

I suspect, from what I've learned so far, that adding inflation protection to the insurance I want would be too expensive. Instead I'd probably go with a policy of limited time horizon (maybe 10 years) and realize that inflation could erode the value of it. I'll assume I'll have enough money in 10 years to self-insure going forward; in fact, I almost have enough now but I need a few more years.


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## Money172375 (Jun 29, 2018)

James, wanted to share my recent experience with an insurance company. I know we talked a lot about what coverages you would have and wanted to discuss with the insurers before purchasing the policy.

Well, I already have a policy. It’s for basic homeowners property/liability. I plan on taking on a volunteer position with a local association. There is protection through the association for liability but I wanted to see if my personal policy would offer any additional protection. I submitted a web query to my insurers and was told the question was sent to underwriting for further review. I then got a call a few days later. They told me to review my policy myself (they are sending another hard copy by mail) and that they could not answer questions on hypotheticals or unique situations. The rep did say that the claims department might have an opinion but they wouldn’t talk to me until a claim was filed. 

Seems like poor service. I’ll try again when I calm down. You would think you would be able to call a insurance company directly and say...”I need, or do you have, insurance that will protect me from XX”. I guess there are thousands of opportunities where one may volunteer and they can’t detail the risks or coverages for all of them. In our association, we have volunteer electricians, plumbers, arborists, accountants, pool operators. It’s quite extensive.


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## Synergy (Mar 18, 2013)

Money172375 said:


> James, wanted to share my recent experience with an insurance company. I know we talked a lot about what coverages you would have and wanted to discuss with the insurers before purchasing the policy.
> 
> Well, I already have a policy. It’s for basic homeowners property/liability. I plan on taking on a volunteer position with a local association. There is protection through the association for liability but I wanted to see if my personal policy would offer any additional protection. I submitted a web query to my insurers and was told the question was sent to underwriting for further review. I then got a call a few days later. They told me to review my policy myself (they are sending another hard copy by mail) and that they could not answer questions on hypotheticals or unique situations. The rep did say that the claims department might have an opinion but they wouldn’t talk to me until a claim was filed.
> 
> Seems like poor service. I’ll try again when I calm down. You would think you would be able to call a insurance company directly and say...”I need, or do you have, insurance that will protect me from XX”. I guess there are thousands of opportunities where one may volunteer and they can’t detail the risks or coverages for all of them. In our association, we have volunteer electricians, plumbers, arborists, accountants, pool operators. It’s quite extensive.


That's unfortunate that they couldn't direct you to / highlight the portion of the policy relevant to your question. Find another agent / company. Claims are on a case by case basis and wordings are up for interpretation so agents / adjusters will never be able to give you a definite answer.

The organization should be arranging insurance for their volunteers as me I would expect that while one is engaged in the act of volunteering that a home insurance policy may not be required to respond. There would however have to be some sort of exclusion on the policy if you have a comprehensive all risk policy...

Let us know what you find out.


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## james4beach (Nov 15, 2012)

I'm going to try taking another stab at all of this as it appears the insurance industry has not shut down entirely due to COVID-19. I will start phoning some agents tomorrow.

Quick recap... I'm self employed and currently have no insurance of any kind. No DI, no life, no group, not even car insurance. I'm worried about getting a major injury/disability in a car or bike accident, or hiking, resulting in potentially large income loss -- e.g. brain injury, blindness, stroke.

I already self-insure for short term income loss so I am only concerned with MAJOR illness, and long term income loss, major health expenses such as hiring extra help or specialists.

If I stay healthy, I should be able to earn ~ 100K annual income. However, if I had a very serious illness, that ability to earn income drops. My objective is to insure many years worth of this income from loss/impairment. *That value is roughly 500K to 1M so the insurance would have to pay out something like that to be worth it.*

I got a DI quote from my professional association, and because I'm self employed, the max payout was very low. There was no point to that insurance because I already self-insure for more, and their payout was too small to get close to the 500K ish value I'm looking for.


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## james4beach (Nov 15, 2012)

I had conversations with two different insurance salesmen. They may call themselves advisors, but they will always be salesmen to me.

The first one gave me the usual pitches but after about 90 minutes into the call, seemed to start getting pretty irritated at all my questions. I also was asking him for a lot of numbers, and that irritated him too.

Anyway, I'm still gathering information and still making the salesmen work. If they convince me, I'll buy it. I'm not convinced yet.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I had conversations with two different insurance salesmen. They may call themselves advisors, but they will always be salesmen to me.
> 
> The first one gave me the usual pitches but after about 90 minutes into the call, seemed to start getting pretty irritated at all my questions. I also was asking him for a lot of numbers, and that irritated him too.
> 
> Anyway, I'm still gathering information and still making the salesmen work. If they convince me, I'll buy it. I'm not convinced yet.


 ... just saw your post and my comment is that 99.5% of these guys/gals (advisors/advisers/ salespeople, etc) would only want to do a sale with a minimum amount of effort (and time), assuming they're knowledgeable in the first place. Ie. your chance of finding that "truly", "dedicated", and "knowledgeable", "advisor" taking into account of the "client's needs and interests" "first", would be "rare" or .5% (very rare).

Your post reminds me these advisors' performance is just a little tad better than the big telecoms' and banks' marketing dep'ts.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I'm going to try taking another stab at all of this as it appears the insurance industry has not shut down entirely due to COVID-19. I will start phoning some agents tomorrow.
> 
> Quick recap... I'm self employed and currently have no insurance of any kind. No DI, no life, no group, not even car insurance. I'm worried about getting a major injury/disability in a car or bike accident, or hiking, resulting in potentially large income loss -- e.g. brain injury, blindness, stroke.
> 
> ...


 ... not sure which marketing materials you have been looking at but it's unlikely you would/will find a $500K (let alone $1M) "CI" policy. And if you do, you'll need to go through some (very) rigorous health examinations, PROVIDED you can afford those premiums first. 

However, A $500K (or $1M) "life" policy isn't that uncommon but then that wouldn't suit your need to provide an income while still on earth. Perhaps an Accidental D&Dismemberment policy maybe a better bet in the event you hurt your head crashing into a tree while biking on some outdoor trail.


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## james4beach (Nov 15, 2012)

It's true that 500K CI policies will require blood tests and all kinds of exams. I didn't know this going in. And since everything is shut down, there are backlogs, and probably has become impossible to get CI which requires medical tests.

I'm now looking at a smaller policy size that's non-medical. So far, the salespeople have spent about 12 hours of time answering my questions and looking into material I asked about. They still haven't addressed all my concerns, so I look forward to having a few more hours of discussions with them.


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## KWill (May 13, 2020)

james4beach said:


> It's true that 500K CI policies will require blood tests and all kinds of exams. I didn't know this going in. And since everything is shut down, there are backlogs, and probably has become impossible to get CI which requires medical tests.
> 
> I'm now looking at a smaller policy size that's non-medical. So far, the salespeople have spent about 12 hours of time answering my questions and looking into material I asked about. They still haven't addressed all my concerns, so I look forward to having a few more hours of discussions with them.


Are you in ontario? I can help you get the answers that you need if you are.


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## james4beach (Nov 15, 2012)

KWill said:


> Are you in ontario? I can help you get the answers that you need if you are.


I'm in a different province and have already applied for Sun Life CI (10 year term, no ROP). Just waiting to hear back from the insurance company.


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## KWill (May 13, 2020)

Great! I'm glad you have it figured out .


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## james4beach (Nov 15, 2012)

If you also know about disability insurance (DI), I'm still trying to figure out the following. I had strong employment income in 2018, and half of 2019 as an employee of a company. Then I switched to self employed in 2019/2020. So far, as self employed, I only have a track record of 4 months of revenue, with no promise of ongoing income. The revenue could stop any moment.

I'm trying to figure out if DI is feasible at all. I asked my professional association, and they said that due to self-employment, their insurance would pay out max 16K a year which seems pointless. I can self-insure 16K a year, even for 20 years!

Do you think it's possible for me to get DI anywhere near my usual income level of 50K to 100K? My self employment income is currently ~ 75K, extrapolating the recent 4 months.

How does an insurer determine how much DI to give a self-employed individual? Do they look at my corporate employee life _before_ being self employed?


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## KWill (May 13, 2020)

james4beach said:


> If you also know about disability insurance (DI), I'm still trying to figure out the following. I had strong employment income in 2018, and half of 2019 as an employee of a company. Then I switched to self employed in 2019/2020. So far, as self employed, I only have a track record of 4 months of revenue, with no promise of ongoing income. The revenue could stop any moment.
> 
> I'm trying to figure out if DI is feasible at all. I asked my professional association, and they said that due to self-employment, their insurance would pay out max 16K a year which seems pointless. I can self-insure 16K a year, even for 20 years!
> 
> ...


I'm pretty sure that the insurance companies will look at work history. But they will also look at the risk factor of your occupation. Like being a desk jockey is less than working as a construction worker. 
You should talk to an Edward Jones advisor. They'll be able to give run an estimate on what you need and get the best price, since they quote through multiple companies.


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## james4beach (Nov 15, 2012)

I ended up buying Critical Illness insurance. Some observations about the process:

I got the feeling that I'm not supposed to ask so many questions. The salespeople seemed like they expected customers to just go along with the info (and advice) presented, rather than delving into details.

The first salesman seemed to have ulterior motives to sell something specific. He was pushing very hard to sell one thing, and I noticed he disconnected / stopped being helpful once I made it clear I didn't like that option. I was told he's one of the best insurance guys around, so that gave me a pretty bad impression of insurance salespeople.

I had a much better experience after switching to a broker that was recommended by a close friend. He was quite helpful, and had access to products from a variety of insurers. I liked that he started by showing me the competing products (from competing companies) and giving his opinion on how they differ, his experiences with each.



james4beach said:


> It's true that 500K CI policies will require blood tests and all kinds of exams. I didn't know this going in. And since everything is shut down, there are backlogs, and probably has become impossible to get CI which requires medical tests.


I went with a smaller policy and am happy with it. It was non-medical for my age, so there weren't any COVID-related delays.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I ended up buying Critical Illness insurance. Some observations about the process:
> 
> I got the feeling that I'm not supposed to ask so many questions. The salespeople seemed like they expected customers to just go along with the info (and advice) presented, rather than delving into details.
> 
> The first salesman seemed to have ulterior motives to sell something specific. He was pushing very hard to sell one thing, and I noticed he disconnected / stopped being helpful once I made it clear I didn't like that option.* I was told he's one of the best insurance guys around,* so that gave me a pretty bad impression of insurance salespeople.


 ... of course, he is an exemplary employee ... for the insurance company and his pocketbook.



> I had a much better experience after switching to a broker that was recommended by a close friend. He was quite helpful, and had access to products from a variety of insurers. I liked that he started by showing me the competing products (from competing companies) and giving his opinion on how they differ, his experiences with each.
> 
> I went with a smaller policy and am happy with it. It was non-medical for my age, so there weren't any COVID-related delays.


 ... glad it worked out for you with the "broker = independent" and you're happy with the coverage. Just knock on woods and don't claim.


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## james4beach (Nov 15, 2012)

Beaver101 said:


> ... of course, he is an exemplary employee ... for the insurance company and his pocketbook.


I should add that the first "insurance expert" (the one I ditched) had designations: CFP, CLU, CHS. He was a financial planner.

Supposedly, the CFP is a top tier designation (link) and: "CFP professionals have demonstrated the knowledge, skills, experience and ethics to examine their clients’ entire financial picture, at the highest level of complexity required of the profession, and work with their clients to build a financial plan so that they can Live Life Confidently™"

This almost makes me laugh. This CFP was trying to sell me incredibly expensive insurance that I didn't need (_and couldn't afford_), certainly putting his own career and bonus ahead of my financial needs. I would rate him 2/10 on ethics and I just imagined the other customers who came to him and took his advice, instead of being critical of what he was suggesting.

A financial planner (CFP) like this guy could absolutely ruin someone's finances. Now imagine what happens when he also advises people on investments and mutual funds.

My whole impression of what "CFP" means was severely downgraded during this insurance-buying experience.


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## Money172375 (Jun 29, 2018)

I think one of the earliest question in dealing when any one in sales (cars, insurance, investments, furniture)....is “how are you compensated”? 

we can debate the merits of any of these sales people....we choose to “pick-on” the financial industry because that’s what we’re passionate about. There are definitely some sleaze bags around. I find one of the major problems is the variety of “theories” that exist in financial planning.....and the average consumer has no expertise to question them. You should be saving 10% of your income.....you should have life insurance xxx times more than your income......you should have a safety net of xxx months. These “theories” often drive up costs and purchases. i find this with my home insurance Which I’ve questioned lately, why do I have a $2 million “simple” solution, rather than one much less.....cause it’s easy to understand....but I’m probably over insured and paying for it.

You‘ll passionate Gardner’s who will say...”you paid what for to tomatoes And peppers.....grow your own....they’re ripping you off”

passionate handy homeowners who say.....”you paid what for a faucet repair or a toilet install......watch a YouTube video and do it yourself”.

neither parties are wrong....We all pay for goods and services that we don’t want to do ourselves........I’m finding as I get older, I’d rather pay someone to do tasks I would have jumped at when I was younger.......I just got a quote to cut down 3 trees for $2000....it kills me that I may need to pay that much.......or it may kill me to do it myself. Lol. Another (more honest arborist?) said he could prune them for $625 to ”give them a few more years”. Either way, I’ll probably choose one of them.....something I wouldn’t have considered 5 years ago.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> I should add that the first* "insurance expert" (the one I ditched) had designations: CFP, CLU, CHS. He was a financial planner.*


 ...oh god, those kind with a slew of designations and every letter in the alphabet. To me they're merely "jack of all trades and master of none". [The worst type would be the one who is the wife or husband recommended by a friend of a best friend.] Seriously, any financially savvy person through years of experience (such as yourself) can "detect instinctively" the expertise of that person via a short conversation.



> Supposedly, the CFP is a top tier designation (link) and: "CFP professionals have demonstrated the knowledge, skills, experience and ethics to examine their clients’ entire financial picture, at the highest level of complexity required of the profession, and work with their clients to build a financial plan so that they can Live Life Confidently™"
> 
> *This almost makes me laugh.* This CFP was trying to sell me incredibly expensive insurance that I didn't need (_and couldn't afford_), certainly putting his own career and bonus ahead of my financial needs. *I would rate him 2/10 on ethics *and I just imagined the other customers who came to him and took his advice, instead of being critical of what he was suggesting.


 ... same here, perhaps louder. That's the key which these so-called "experts" failed to realize as Rule #1 (Having Ethics and Honesty) and yet woefully lacking these days. I guess they figured if they spin the soliciting in such a way to meet the regulator's minimum requirements, they can get away with it and will. I think in way, it's not their own doings but that of their sponsoring firm, if they're not self-employed or soliciting under their own firm. To gain a (long-term aka loyal) "client" takes practice of one simple word: TRUST.



> A financial planner (CFP) like this guy could absolutely ruin someone's finances. Now imagine what happens when he also advises people on investments and mutual funds.


 .. this guy/gal would most likely recommend segregated funds or one with the highest MERs ... and he/she'll tell you with a straight eye that all his clients (aka ethics is a word, not practiced) are so happy with his recommendations that he has no problem suggesting them to you.



> My whole impression of what "CFP" means was severely downgraded during this insurance-buying experience.


 ... no doubt and the perception is not going to get better ... as customers/investors become more educated.


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## Beaver101 (Nov 14, 2011)

Money172375 said:


> I think one of the earliest question in dealing when any one in sales (cars, insurance, investments, furniture)....is “how are you compensated”?


 ... I like this right-to-the-point question ... and the answers with that question from a couple of "banks" financial /investment planners (full brokerage house) were 1. a silent dance-around, and 2. 2% of $250K of investments is $500 per annum (cheap!) 

No wonder investors are going DIY by the droves as it goes back to saying of "who's more passionate about your money than yourself"? With all the moola$$$ saved can be spent to call-in the plumber, roofer and arborist who can "actually" or "physical" do some "work" other than blowing hot-air or worst wasting your time while giving you bad breath (pre-Covid19).


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## fireseeker (Jul 24, 2017)

Beaver101 said:


> 2. 2% of $250K of investments is $500 per annum (cheap!)


Did they actually say $500, or is that a typo?

I am guessing the latter, but wouldn't be shocked if it was the former.


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## Beaver101 (Nov 14, 2011)

fireseeker said:


> Did they actually say $500, or is that a typo?
> 
> I am guessing the latter, but wouldn't be shocked if it was the former.


 ... no typo - the financial expert said "five hundred dollars" per year after I asked again.

Too bad I didn't have a handheld calculator at that time to verify (for him) as I was overwhelmed/loaded with his pitch of all the services available from his firm ( full services brokerage of a (big) bank) with its multiple specialty dep'ts.

At the end, back to square one: I asked myself "would I want to hire a financial planner who can't do simple math?" assuming it was not an intentional misled.


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## Money172375 (Jun 29, 2018)

Were they talking About MERs or a fee based charge? 

perhaps the $500 is their trailing commission....ie. they earn $500 of the $5000 charged in MERs?


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## Beaver101 (Nov 14, 2011)

Money172375 said:


> Were they talking About MERs or a fee based charge?
> 
> perhaps the $500 is their trailing commission....ie. they earn $500 of the $5000 charged in MERs?


 ... $500 per year is his fee for his recommendations of "stocks" with a $250K AUM portfolio and some other financial planning advice such as tax, estate planning etc. I was more interested in the latter services than the need for stocks recommendations as I told him I already had mutual funds with no further interest in them other than converting over. 

In hindsight how much of his time would I have gotten for $500 ...maybe a generic list of "stocks" ... from the Dividend Aristocrat list? Too funny.


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