Accident and Sickness Insurance

Introduction

• This module focuses on accident and sickness insurance, the third in a series.
• Discusses issues arising from accidents or long-term illnesses.

Coverage Aspects

• Accidental Bodily Injury: Covers losses from accidental injuries.
• Products: Includes accidental death, sickness, disability insurance.
• Health Care System:
  • Canadian health care system includes dental and preventative care plans.
  • Available through individual plans or provincial health plans.

Financial Risks

• Injury Consequences:
  • Medical expenses, home modifications.
  • Loss of income if unable to work, leading to dipping into savings.
  • Potential decrease in standard of living.
• Inflation:
  • Affects purchasing power, need indexed products.
• Aging Population:
  • Longer life expectancy increases demand for long-term care.
  • Long-term care facilities are expensive.

Insurance Products

• Individual Products:
  • Coverage for disability, serious illnesses (e.g., heart attack).
  • Protects income, savings, and assets.
• Business Products:
  • Insure key business individuals, maintain operations during their disability.
  • Business overhead expense coverage keeps business open.
  • Disability buyout insurance allows partner buy-out.

Sources of Disability Coverage

• Employer Group Plans:
  • Coverage through employers, associations, or unions.
• Personal Policies:
  • Necessary for self-employed individuals.
• Creditor Insurance:
  • Covers debts (e.g., car loans) during disability.
• Workers Compensation Board:
  • Covers work-related injuries (both physical and stress-related).
• Pension Plans:
  • Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) for disability pensions.

Definition of Disability

• Critical to understand the definition, as many plans require one to be "totally disabled" to receive coverage.