What is disability insurance and what plans are available to me in Toronto?
Disability insurance is a type of insurance coverage that supplements your income in the event that you become injured, chronically ill, or otherwise unable to work. As benefits are determined based on salary or wages, only employed persons in Toronto can purchase a disability insurance policy.
Depending on the nature of your work and eligibility, you might obtain benefits through government insurance programs or through private plans. Government disability insurance coverage is available through the province of Ontario’s Workplace Safety and Insurance Board (WSIB), through federal Employment Insurance (EI), and, for those who qualify, through Canada’s Pension Plan (CPP). Both the WSIB and CPP programs also provide certain benefits for the family and other dependents of the policyholder.
Private disability insurance policies may be available through a group plan provided by your employer or purchasable through your union or professional organization or individually purchased directly from an agent or insurer itself. In the case of some employer-provided group disability insurance plans, you may see deductions on your paycheck to help contribute to your premiums. But only the portion of the benefits your employer pays for are taxable; you will not owe taxes on any premiums you pay.
Individual disability insurance policies are also available for anyone to purchase privately. There are many reasons you may choose to purchase an individual plan, such as if your employer-provided coverage is inadequate, if your employer does not provide disability coverage at all if the group plans are available to you via other sources (unions, professional organizations, etc.) are unaffordable, or if you don’t have a direct employer. Individual disability plans allow policyholders to have the utmost control over the coverage they carry, and they offer portability—in other words, the plans are not tied to a specific employer. For this reason, many Canadians enjoy the peace of mind and flexibility of private individual plans.