Valley First

Income Loss

If your income stops because of illness how long could you pay your bills?

“I’ve noticed a surge in Facebook posts asking me to help support families going through terrible illnesses. These are people I know. I keep getting kicked over to crowd-funding sites and reading stories about friends or friends-of-friends who are caring for their sick spouses or children. It’s sad. I saw one family sold their family business. Another had to take a leave from work. They all need money to pay their mortgages, but also to cover new costs for hotels to be near the hospital. I just keep thinking: if you had coverage I know this would be less stressful.”

Start with some advice.

Important: This likely isn’t a topic you’re looking forward to thinking about, but it’s crucial that you don’t avoid it, either.

Nobody wants to think they or their family will become ill or disabled. But the stats show it’s very possible. Consider this: one in six Canadians will be disabled for three months or more before the age of 50. And the Canadian Cancer Society estimates two in five Canadians will develop cancer in their lifetime. The positive news? The same research shows 63% of Canadians diagnosed with cancer will survive at least five years after their diagnosis.

So if the odds are that you or an immediate family member might become ill or disabled, the need to be financially prepared while you’re well and able is crucial.

Most people think they have enough coverage with their work health plan, but the reality is these benefits aren’t enough—typically paying out only a portion of your salary for a limited time. What’s more, people going through treatment for illness or disability find their costs increasing not decreasing (factor in more for childcare, medical, homecare and travel costs). Financial experts recommend having the equivalent of six months’ salary set aside for emergencies but most Canadians can only manage for a month or less before dipping into retirement savings or going into debt. Studies indicate that on average only 30 per cent of Canadians could pay their bills if they were ill or disabled.

This is where insurance can play an important part in your financial plan.

With critical illness insurance you pay a monthly premium based on how much coverage you need. You’ll get a one-time lump-sum payment should you contract one of your policy’s “covered” illnesses (cancer, heart attack and stroke make up 90 per cent of illness claims). When you reach your chosen policy maturity date (typically when you turn 65) you’ll get back 100% of your premiums if you haven’t made a claim. You get the cash if you need it, and if not, you get it back to do something else with in retirement.

Disability insurance should also be considered. Disability insurance provides a monthly income if you’re unable to work due to a serious injury. Before making this purchase, you should check with your human resources department to understand what coverage you have through your employer.

Make it personal.

While the tips and reminders above are valuable, a critical part of your financial planning process should be seeking advice tailored to your situation. Book a free consultation with one of our highly accredited personal insurance experts.


Talk to us

Whether you’re looking for more information, or you’d like to let us know how we can serve you, you’ll find our contact information here.
We encourage you to visit an insurance specialist at any of our branches for more information on how Valley First can make things simple!