Obviously, more coverage and considerations result in a higher premium costs, assuming that you qualify for the policy you want. However, cost is just one factor; ultimately you want to ensure that your policy is structured so that you can collect.

To make your disability insurance affordable, you might consider disability plans that have a very comprehensive definition of disability for 2-3 years and then offer a less encompassing (but acceptable) definition of disability. In this way, you can protect yourself and your family at a reasonable price.

Another way to lower premiums is by extending the waiting period (otherwise known as the elimination period) before benefits start. Chris Chornick, Manager of Marketing with Great West Life says that by opting for a longer waiting period (such as 90 days) will result in lower premiums. "If you reduce the elimination period from 30 to 60 days, there can be a 15-20% drop in your premium," he said. "If you reduce it from 30 to 90 days, there could be a 35-40% savings." [07]

There may also be tax benefits associated with purchasing a particular policy. Lackman advised that if you personally pay your disability insurance premium (using after-tax dollars) rather than allowing your employer to pay the premium, the disability benefit you receive in the event of sickness or injury may not be subject to taxes. But, he said that the non-taxable clause is not true in all cases.

David Lackman said that a careful read of the policy is necessary to determine if this feature is present. Deacon also advised potential buyers to read the policy carefully during the 10-day period allowed by insurance legislation which gives consumers time to review and reflect on the fine print to determine if it meets their requirements. If it doesn't, Deacon said the consumer can send it back with a full refund.

But do you qualify?

Making a claim