I believe we have a couple choices when we purchase a product, we either research it and learn everything there is to know about the product or we deal with someone who we trust has already done this. A great example for me is when I call my plumber, I don’t research how he is going to fix my plumbing problem I contact a plumber I trust.
Disability Insurance can be very technical and it is an area of the Insurance Contract that I have immersed myself in and I have a very good understanding of both the Employee Benefit Disability and the Individual Disability products.
This is a benefit that when researched and placed correctly can ensure you do not require a “Go Fund Me” page, which will never replace a person’s income. A “Go Fund Me” page is a kind thing to do, but to replace someone’s income is like putting a band aid on a severed jugular.
The Graded Scale can assist in ensuring high income earners are not paying for more benefit then they can receive. Manulife has put together a great article on how a Graded Scale works.
The Graded Scale is used when the Employee’s Disability benefit is Non-Taxable, and a benefit becomes Non-Taxable when the employee pays the premium with After Tax Dollars. Are you confused yet?
Your Group benefit plan has a clause that is called “85% All Source Maximum”. So a disabled employee cannot take home more than 85% of their Net Take Home Pay. So the next question is what is a Net Take Home Pay, I will explain that next week, it deserves it’s own Blog.
This can be a complicated part of the contract and an important part of the contract to understand. So I recommend you either take time with your broker and ensure you understand the wordings in your contract or work with a broker that understands the wordings in the contract.
Please contact Glendinning Insurance Services, your Resource Specialist to get a better understanding of the wordings in your contract.