Canada Critical Illness Insurance – FAQ
The purpose of this critical illness insurance FAQ blog post by Benefit Strategies, is to offer answers to some very basic questions that most Canadians have on this subject.
A critical illness insurance policy helps pay costs associated with a life-altering illness and is received as a lump sum cash payment. Essentially, a critical illness insurance policy helps you recover from a serious illness, condition, or disease, while maintaining your family’s lifestyle and financially stability.
For more information outside of this critical illness insurance FAQ, please contact our Edmonton Benefits Brokers directly at 1-780-437-5070.
Frequently Asked Questions
What is a critical illness?
Each critical illness insurance policy is unique but common critical illnesses may include:
- Heart Attack
- Stroke
- Life threatening cancer
- Major organ transplant
- Total deafness or blindness
- Loss of speech
- Severe burns
- Parkinson’s Disease
- Alzheimer’s Disease
Why do I need critical illness insurance?
A critical illness insurance policy will ensure that you have the financial resources should you get sick and are unable to earn an income for any period of time.
Here are just four ways a Canada critical illness insurance policy could help you:
- Pay for financial obligations – Including you mortgage, car payments, credit card debt, and so on.
- Keep your independence – Make any modifications to your home or vehicle, or hire a caretaker to help.
- Pay for medical services – Help offset costs for medication or treatments not covered by your Provincial Healthcare provider.
- Relieve the pressure – Gives you the freedom to spend your time however you think may be most conducive for recovering, including spending time with family.
Is critical illness insurance worth it?
The answer to this question is personal. Everyone places a different value on their peace of mind, knowing they are financially secure in the event of becoming sick or incapacitated. Other people may prefer to forego insurance premiums and would rather save up a rainy day fund to cover critical illness expenses, should they occur. When deciding how you feel about critical illness insurance keep in mind that most Canadians have a reasonable probability that they will develop a critical illness by the time they are 65.
What affects critical illness insurance cost?
There are a number of considerations that can affect the cost of critical illness insurance rates:
- Pre-existing conditions
- Age
- Gender
- Amount of coverage
- Smoking and drinking status
- Health history
- Current health
- Occupation
- Family History
Can I get combined life and critical illness insurance?
Many Canadian insurance companies offer disability insurance and critical illness insurance together. These bundled or combined disability and critical illness insurance policies can often help you save money over time.
What’s the difference between disability and critical illness insurance?
There are three main differences between disability and critical illness insurance:
- Critical illness insurance pays out as a lump sum and typically sooner than disability insurance.
- Critical illness does not require proof of income while disability insurance does.
- Critical illness insurance policies are typically less expensive than disability insurance.
Disability insurance protects your income against the risk of a disability that would prevent you from working. Disability insurance will only pay out a portion of your income, until you are able to return to work.
Critical illness insurance however, pays the benefit after a diagnosis of a serious life-altering illness, regardless of whether you have a current income or not, or if you are able to work or not.
Is critical illness insurance taxable?
A critical illness insurance benefit payout is usually not taxable and comes in the form of lump sum payment, for you to spend in whatever way you wish.
Furthermore, any employer-paid critical insurance premiums are not a taxable benefit to the employee.
Do You Still Have Questions?
At Benefit Strategies Inc., critical illness insurance is just one aspect of our executive benefit solutions to help balance the benefit requirements of owners and managers.
If you have more questions that this critical illness insurance FAQ couldn’t answer, please call 1-780-437-5070 to speak with one of our executive benefit advisors today, or contact us online for a free Consultation.
Why Employee Benefits Are Important
Do you know why employee benefits are important?
If companies do not offer benefits as part of their overall attraction and retention strategy, what type of employee are they looking to attract? Most companies are looking to hire young, long-term employees they can build the future growth of their organization around and vice versa.
What are these employees looking for? Whatever it is, you can best believe they know why employee benefits are important. Hays 2014 Compensation, Benefits, Recruitment and Retention Guide says that when a candidate makes the decision to accept or decline a position, nearly 20% of that decision is based on the benefits they are offered.
Employee benefits are important and are becoming the new standard among employers seeking talented individuals in today’s job market. With growing families, employees want a health and dental plan along with the security of disability benefits and life insurance. However, it doesn’t stop there. Employers are tuning in to why employee benefits are important and offering other incentives including the following:
- Performance bonuses
- Group RRSP or Pension Plan employer match
- 2 weeks vacation
- Flexible work schedule
- Ability to work from home
- Healthcare Spending Account
Today, in Alberta’s economy, many employers struggle to find employees from a shrinking talent pool. To be competitive in recruiting the top talent the report recommends small companies focus on promoting cost-effective benefit plans, Healthcare spending accounts, Group RRSP contributions, Workplace Flexibility, and opportunity for advancement.
To find out more, call your Benefit Strategies broker at 1-780-437-5070.
What Can a Flexible Benefits Plan Offer Your Employees?
A flexible benefits plan for employees is tailored to meet employees’ unique personal needs.
A basic benefits plan offers employees a minimum level of employer-paid benefits such as:
- Health
- Dental
- Accident
- Disability
- Life insurance
The plan is then topped up with “flex credits” (or a dollar amount), and put into a third party health spending account (HSA).
Employees can choose to use these credits to supplement their basic benefits coverage or to buy other kinds of benefits that may be more useful.
Typically, your third party administrator manages these taxable and non-taxable spending accounts and reimburses your employees as the employees incur expenses.
Flexible Benefits Plan Advantage
Also referred to as a “flex plan,” the customizable flexible benefits plan gives you (as an employer) a competitive advantage, and is often more highly valued by your employees than a traditional or fixed employee benefits plan.
The overall trend is for plan sponsors to move from traditional plans to a flexible one. There’s just one question to ask then. Is it time for you to switch to a Flexible Program in your workplace?
Factors to Consider
There are several factors to take into account when considering such a plan:
Flexibility: A flexible Benefits Plan is especially beneficial to workplaces with employees in every different stage of life. The benefit needs of a single 25-year-old male will be much different than a 38-year-old female with three kids at home, and different again for a 65-year-old male nearing retirement age. Flexible Benefits Plans allow your employees to use the benefits most relevant to themselves and their families.
Satisfaction: Employees feel empowered and in control when they get to choose how to spend their flex benefit plans. They will likely also feel like they have better coverage.
Costs: A Flexible Benefits Plan gives the employer the ability to control costs by setting benefit limits each year. This allows you to properly budget each month, and there will be no surprises come the end of the year.
Need More Information?
Are you second-guessing your “one-size-fits-all” employee benefits plan?
If you have questions or would to know how a Flexible Benefits Plan can help your employees, perhaps it’s time to talk our trusted Edmonton employee benefits broker, Daryl Smith.
Call Daryl Smith at 1-780-437-5070 or send him an Email.
You can also reach him through our online Contact Form.