Top-up Strategy

The Situation
You are a business owner, executive or high-income employee. You have group long-term disability (LTD) benefits in place, and believe that you are fully covered by the group LTD plan. Upon closer examination of the LTD plan, you realize that an employee with an average salary is afforded a greater percentage of income protection than a higher-income employee, executive or owner. In addition, the group LTD plan only covers salaried income and not bonus income.

The Strategy
Purchase an Individual Disability Insurance policy. When the amount of LTD coverage is inadequate, topping up group coverage with Individual Disability Insurance coverage is the best way to protect your total income needs.

In addition to increasing the amount of coverage, Individual Disability insurance can be permanent coverage, which you own and control, with level premiums guaranteed until age 65. The coverage is portable, which means that your plan remains intact regardless of where you work, and you have the option of purchasing a cost-of-living rider, future insurability rider and the catch-up rider.

Individual Disability Insurance also gives you the option of purchasing the Return of Premium benefit (ROP), which returns up to 70% of paid premiums after 10-years, and usually every eight years thereafter. ROP places you in a unique situation. If you become disabled, the insurer will pay the chosen benefit, however you may elect to receive a refund of premium if you remain healthy and do not have any claims.

This Top-Up Strategy provides:
· Non-cancellable disability protection
· Guaranteed level premiums to age 65
· Partial disability benefits
· Portability
· Return of Premium benefit

This material is for information purposes only and should not be construed as legal or tax advice. Every effort has been made to ensure its accuracy, but errors and omissions are possible. Individual circumstances may vary and specific legal and tax advice is recommended.

This strategy is based on current tax legislation. Future tax changes and market conditions may affect this program.

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