Page 57 - A Canuck's Guide to Financial Literacy 2020

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which would categorize him as totally disabled as he wouldn't be able to continue
performing heart surgeries. However, he could be a professor.

Regular Occupation Policy

This definition goes hand in hand with "own occupation". Coverage will be provided if the
conditions of own occupation are met. The insured is unable to work in any gainful
occupation. Benefits might stop if the policy holder finds a job that would meet their
experience, training or education.

Any Occupation Policy

This policy would fall under total disability and would provide benefit if the individual insured
is unable to work in any occupation that they are suited for based on experience, education
and training. Benefits will stop if the insured can do any job.

Partial Disability

Partial Disability is based on time and defined as any type of disability which the insured is
unable to perform at full physical capacity. This could be due to a job injury or illness.

Reduced benefit would be paid if:

• the insured cannot perform one or more duties of their job
• the insured is unable to perform their job at least half of the normal time required.
For example, an individual is supposed to work 37.5 hours a week but due to injury,
they work only 15 hours.

Monthly benefit amount is a percentage of the full benefit such as 50 for the first 36 months
and reduced amount thereafter.

Residual Disability

Residual disability is based on income and is defined as the inability to perform your
required job duties, thus resulting a loss of income. Insurance companies will pay benefits if:

• The policy holder has loss of earnings of at least 20%. If the insured has a loss of
80% of their income, the insurance would pay 100% of the benefits.

Partial and Residual Disability
Partial and Residual disability are interchangeable and insurers typically allow you to switch
from partial to residual at least once. Partial Disability is based on time meaning that you're
working less and Residual Disability is based on income, meaning you're earning less.