Disability and critical illness guarantees both cover serious health accidents. To choose wisely, one must be aware of the limits of the first and the little-known advantages of the second. Disability insurance guarantees the replacement of part of your income when illness or injury prevents you from working. It’s helpful, but you need to get the extent of the warranty spelled out, says Sally Praskey, co-author of the book What Canadians Really Need to Know Before Buying Insurance. Is the pension payable if you can no longer practice your current occupation or only if you can no longer work at all? What is the waiting period? How long do the payments last? Policies (and premiums) vary.
Critical illness insurance can be more attractive in some cases, continues Sally Praskey, because it covers many health problems and simply guarantees the payment of a lump sum which can be used to pay bills during your recovery as well as to take a trip or pay for medical care. It does not matter whether you can work or not, it is enough to produce the medical diagnosis. “I survived three cancers, concludes Sally Praskey, and I would have liked to benefit from this kind of insurance.”
