How Do You Know What You Don’t Know About Insurance?

April 29, 2010

The good thing about insurance plans that
provide a lot of choices (such as those in the
Canadian Dentists’ Insurance Program) is
that they can be tailored to very closely match
your needs. On the flip side, however, using those
plans to your greatest advantage means that you
need to understand them. To help measure your
knowledge, consider the following questions
which dentists have asked advisors at CDSPI
Advisory Services Inc.

1. If I have practice interruption insurance,
will my office costs be paid if I become temporarily
disabled?

No, practice interruption insurance does
not apply to disability claims. For example,
within TripleGuardTM Insurance, practice
interruption insurance covers fixed expenses
and loss of income when use of your office is interrupted because of perils such as
fire or flood, being prohibited from entering
the premises by authorities, due to property
damage to neighbouring premises, and other
covered situations related to loss or damage.
For your office expenses to be covered when
you are disabled, you need Office Overhead
Expense Insurance
—a totally different type
of insurance.

2. If I become disabled and can’t practise
dentistry, but can do some other type of
work, will I continue to receive disability
benefits?

It depends on what sort of coverage you have.
With the Program’s Long Term Disability
Insurance
, if you have selected the “Own
Occupation” option, if a disability prevents
you from engaging in the occupation(s) you
had before becoming disabled, you will receive
disability benefits even if you are able
to earn income from a new occupation.

3. If I have old equipment in my office that
isn’t worth much any more, should I have a
lower level of offi ce contents insurance?

It’s true that under TripleGuardTM Insurance
you can choose to be reimbursed for only the
depreciated value of items that are stolen
or damaged by covered incidents. However,
because the insurer will pay for repair or
replacement, you should insure the full replacement
value of your equipment in the
event of a loss where your equipment cannot
be repaired.

4. If my income goes down, should I reduce
my level of disability insurance?

If you know that your income is not going
to go up again, reducing your coverage is a
reasonable way to reduce costs, since you
don’t need to pay for coverage you can’t use
(benefits payable are based on your actual
loss of income). However, if you think your
income could go up again to the level that
you are currently insured for, it may be best
to hold on to all of that coverage. Increasing
your coverage at a later date will require
providing evidence of good health, and you
might not be healthy enough in the future to
be approved for more coverage.

5. Can my office be covered in case of a pandemic?

Pandemic outbreak coverage isn’t standard
in many office insurance plans. However, to
help offset your loss during a pandemic outbreak,
TripleGuardTM Insurance’s practice
interruption coverage provides up to $1,000
per day after the first 24 hours (up to a total
of $20,000) when you are prohibited from
entering your office by an order from a civil
authority or public health official. For an
additional premium you can increase this to
$2,500 or $5,000 per day. (Higher amounts
may be of particular interest to multi-dentist practices
who share one TripleGuardTM Insurance plan.)

6. If I have term life insurance, why would I need
permanent life insurance?

The two types of insurance cover different needs.
Term life insurance terminates at a specific age, and
so it is best for temporary needs, such as protection
for your children when they are young or to cover a
mortgage. In contrast, permanent life insurance, such
as Term 100 Life Insurance from the Program, lasts
your whole life (as long as premiums are paid). This
makes it ideal for estate planning. For example, you
may select permanent insurance to ensure funds are
available to pay capital gains taxes on a cottage you
wish to pass on to your children, or to leave money to
a charity you support.

Did you know the answers to these common questions
about major insurance plans? Do you have a strong
grasp of other plans, such as Legal Expense Insurance, or
Personal Umbrella Liability Insurance? Are you aware
of all the different types of insurance available through
CDSPI and CDSPI Advisory Services Inc. (including
new CDSPI Home & Auto Insurance which offers preferred
group rates)? Sometimes it’s even difficult to know
what you don’t know about the plans—but that’s why the
Program’s insurance advisors are here to help.

The best way to make sure you have the right types
and amounts of insurance to fill your particular needs is
to talk to a licensed insurance advisor at CDSPI Advisory
Services Inc. Your advisor can provide a no-cost review
of your current portfolio and make suggestions for improvements.
They may even be able to save you money,
by helping you get the appropriate amount of insurance
or by telling you about new ways to economize (such as
applying for the new, lower AdvantEdge premiums for
Basic Life Insurance). Call 1-877-293-9455 ext. 5002 for
assistance.

Ms. Roberts is service supervisor, Insurance Services, CDSPI Advisory.
Services Inc

To view CDA Fund performance online, please visit www.cdspi.com/funds.

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