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Humans are amazingly adaptive. But sometimes it takes a long time for them to recover from unexpected circumstances. Car crashes. Heart attacks. Cancer. These can have lasting impacts on our ability to perform our jobs and earn money.

Your employer may offer sick time and a few weeks of short-term disability. But what if you still can't work after that? A large percentage of mortgage foreclosures are the result of long-term injuries or illness.

You can protect yourself from the financial effects of these situations with long-term disability insurance. Most people have car insurance, yet many working adults in this country don't have coverage to protect their most valuable asset - the ability to earn a living.

According to Statistics Canada, as of a 2006 survey, some 4.4 million Canadians are living with a disability, and 2.4 million of them are between the ages of 15 and 64 years old. For most, the disability interferes with the kind -- and amount -- of work they're able to do. According to that 2006 survey,  Statistics Canada reported unemployment for Canadians with disabilities at 10.4% whereas for those without an disability unemployment is 6.8% as of 2006. Projections for 2009 were similar at 10.8% and 6.4%, respectively.

Are You Covered?

You may already have long-term disability coverage through your employer. Some employers offer some sort of combination of short- and long-term disability benefits as part of their employee package. You may have coverage and not even know it. But if you're self-employed, you don't. In any event, lining up disability insurance should be a real priority.

CPP Disability Benefits

The Canada Pension Plan (CPP) disability benefits are part of the broader CPP plan which began in 1966. They are administered by Human Resources Development Canada (HRDC) and are available to people who have made enough contributions to the CPP, and whose disability prevents them from working at any job on a regular basis. The disability must be long lasting or likely to result in death. People who qualify for disability benefits from other programs may not qualify for this one.

You have to apply for a CPP disability benefit in writing. You can also apply online through Service Canada, if you meet certain requirements. Visit the CCP Application area of the SC’s website here to learn more about the process. There are also benefits available to the children of a person who receives a CPP disability benefit. If your application isn't accepted, there are three opportunities to have your application reviewed or reconsidered.

Once you qualify for and begin receiving a CPP disability benefit, you must keep HRDC informed of certain events in your life, including name and address changes. And HRDC will occasionally review the health and work status of people receiving a CPP disability benefit, to ensure that they continue to be eligible. You can continue to receive benefits as long as you are under age 65 and as long as the CPP continues to deem your condition "severe" and "prolonged."

Other Insurance

Getting a handle on private disability insurance — explanations of which are rife with references to exclusions, occupational classifications and a whack of other confusing terminology — can be frustrating. In the world of disability insurance, the very definition of disability is the key to the quality of your plan.

"Own Occupation" vs. "Any Occupation"

This is an important designation on your policy that determines what it means to be disabled. "Own occupation" says you're disabled when you're unable to perform your current job. "Any occupation" says you're disabled when you can't perform any job. Obviously, coverage that's concerned with "own occupation" is preferable, but it's also more expensive.

Total Disability

The shallowest protection is from a policy that considers you disabled only if you're unable to work at any job at all.

Other Policy Considerations

A good disability insurance policy will:

  • Pay benefits whether your disability arises from accident or illness
  • Be non-cancellable (by the insurance company, except for non-payment of premium).

Although it may seem confusing, it's actually not that hard to shop for disability insurance in this country. There are only a few companies that offer long-term non-cancellable individual disability insurance in the Canadian marketplace. You can get a complete list of those that do through the Canadian Life and Health Insurance Association (1-800-268-8099;