If you lost your ability to earn an income, you could also lose the lifestyle you’ve created. An accident or serious illness can happen when you least expect it, leaving you unable to work and earn money. Your provincial health plan can help with the medical bills. But to replace lost income, you need disability insurance.
The lifestyle you enjoy, your children’s college education, and your retirement savings all depend on your ability to earn a living. If you suddenly had less money coming in—plus additional money going out to cover bills related to your disability—where would the money come from to replace your lost income?
Even if you already have disability insurance through your employer, it may not be enough. Plus, if you change jobs, your employer-sponsored disability insurance will most likely end with your employment. What's more, disability benefits under the Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) limit the benefits you can receive.
Also consider the probability of incurring a 90-day or longer total disability prior to age 65(1) (see chart below). When a disability lasts longer than 90 days, the length of that disability averages between 2.1 and 3.2 years for those age 55 and younger.