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Disability insurance – Could you afford not to have it?
DESJARDINS FINANCIAL SECURITY | 2
Agenda
• Why do you need disability insurance?
• How does it work?
• What are the options?
• SOLO Disability Income features
• Examples
• How can you buy it?
Whether it's…
mortgage or rent
groceries
car payments
daycare
tuition fees
Or any other expenses…
We all have bills to pay… every month…
And if suddenly,
you were unable to work and earn an income
What would you do?
DESJARDINS FINANCIAL SECURITY | 12
What do you think your most valuable asset is?
Is it your property… your vehicle… your investments …something else?
Age $24,000 $36,000 $60,000 $120,00025 $1.809,630 $2.714,445 $7.247,986 $14.495,973
30 $1.451,090 $2.176,635 $5.419,218 $10.838,437
35 $1.141,810 $1.712,715 $3.986,331 $7.972,662
40 $875,022 $1.312,534 $2.863,626 $5.727,252
45 $644,889 $967,333 $1.983,957 $3.967,914
50 $446,374 $669,561 $1.294,714 $2.589,428
55 $275,133 $412,700 $754,673 $1.509,347
DESJARDINS FINANCIAL SECURITY | 13
Everybody is millionaire!
Your income is a most valuable asset that you will acquire during your lifetime.
That is why :
Disability Insurance
= Basis of your financial security
DESJARDINS FINANCIAL SECURITY | 14
From the other perspective…
When you buy a car:
You call immediately car insurer to protect it!
À L'USAGE EXCLUSIF DES CONSEILLERS 14/57
DESJARDINS FINANCIAL SECURITY | 15
From the other perspective…
When you buy a house:
You call immediately home insurer to protect it!
À L'USAGE EXCLUSIF DES CONSEILLERS 15/57
DESJARDINS FINANCIAL SECURITY | 16
From the other perspective…
When you buy stainless steel appliances:
You will probably insure them if something goes wrong.
À L'USAGE EXCLUSIF DES CONSEILLERS 16/57
DESJARDINS FINANCIAL SECURITY | 17
From the other perspective…
But when you earn your salary and have no disability protection to protect it, do you buy disability insurance right away?
Disability Insurance
= Basis of your financial security
If you have no income, will you have enough money to pay your house, your car, your appliances, your other insurances if disabled?
DESJARDINS FINANCIAL SECURITY | 18
Reality in case of illness or accident
Revenues
Expenses
Disability
DESJARDINS FINANCIAL SECURITY | 19
How long could you live off your savings?
If you save for:
5 % of your income
10 % of your
income
15 % of your
income
2 years 1 ½ months 3 months 4 ½ months
5 years 3 ½ months 7 ½ months 11 months
10 years 7 ½ months1 year et 3
months1 year et 10
months
A long-term disability (90 days & +) can be bad for your financial security!
DESJARDINS FINANCIAL SECURITY | 20
Probability of becoming disabled before age 65 and average duration of
disability for 90 days or more
Age Probability Average duration
25 40% 2 years and 2 months
30 39% 2 years and 8 months
35 37% 3 years and 1 month
40 34% 3 years and 6 months
45 31% 3 years and 11 months
50 26% 4 years and 2 months
55 21% 4 years and 5 months
DESJARDINS FINANCIAL SECURITY | 21
How does disability insurance work?
It pays you a monthly benefit:
…to replace your income
…when you are not able to work
…due to an illness or accident
DESJARDINS FINANCIAL SECURITY | 22
Main components
1. Monthly benefit
2. Waiting period
3. Benefit period
DESJARDINS FINANCIAL SECURITY | 23
Options
• Regular occupation period
• 2-year
• 5-year
• Up to 65 years
• Residual or partial disability
• Cost of living
• Future insurability option
DESJARDINS FINANCIAL SECURITY | 24
SOLO Disability Income unique features
1• 1st day in case of
hospitalization or day surgery(For waiting periods of 90 days and less)
No
DESJARDINS FINANCIAL SECURITY | 25
SOLO Disability Income unique features
2 • 1st $1,200 guaranteed• No integration and no
coordination apply for the first 36 monthsNo
DESJARDINS FINANCIAL SECURITY | 26
SOLO Disability Income unique features
35 x your monthly benefit if you are diagnosed with 1 of the 25critical illnesses• Disabled or not• Paid on top of your benefitNo
DESJARDINS FINANCIAL SECURITY | 27
Covered critical illnesses
• Cancer• Heart attack• Stroke• Coronary Artery Bypass Surgery• Multiple sclerosis• Parkinson• Paralysis• Kidney failure• …
Total: 25 illnesses!
DESJARDINS FINANCIAL SECURITY | 28
SOLO Disability Income unique features
4• An extra 5% paid on top of the
benefit starting on the 13th month of your disability income payment (in a DFS savings account)
If $2,000 benefit, it means an extra of $100!
No
DESJARDINS FINANCIAL SECURITY | 29
SOLO Disability Income unique features
5 • 5 x the monthly benefit in case of death(Paid if the death occurs while receiving disability benefits)
No
DESJARDINS FINANCIAL SECURITY | 30
SOLO Disability Income unique features
• Regular occupation period
• Residual or partial disability
• Cost of living
• Future insurability option
• Return of premium: up to 50%
Furthermore,
you could add
those
options:
DESJARDINS FINANCIAL SECURITY | 31
Which job would you choose?
Job A
• $33,000 per year• $0 if you become disabled
Job B• $32,000 per year• 90% of your net income up to age 65 if you become
disabled
DESJARDINS FINANCIAL SECURITY | 32
How much does it cost?
Classification 120 daysUp to age 65
2A $1,850/month
Age 25 30 35 40 45 50 55
Female $67 $80 $95 $125 $171 $213 $233
Male $53 $63 $78 $106 $151 $196 $225
• PLUS Future insurability option $1,000
DESJARDINS FINANCIAL SECURITY | 33
Next steps
Monthly benefitAge
18 to 45 years 46 to 55 years
$0 to $2,000 1 1
$2,001 to $3,999 1 2
1. Medical questionnaire
2. Medical questionnaire, nurse visit, urine test
Thank you!