Tuesday, June 25, 2024

Best Long-Term Disability Insurance Canada 2023

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Jillian Castillo
Jillian Castillo
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Securing your financial future means planning for life’s unexpected turns, and one of those turns could be an extended illness or injury that prevents you from working. Long-term disability insurance is a safety net designed to provide you with a percentage of your income if you are unable to work due to a serious injury or illness. In this article, we delve into the best long-term disability insurance options available in Canada.

Understanding Long-Term Disability Insurance

Long-term disability insurance is designed to replace a portion of your income if you become disabled and are unable to work for an extended period. These policies typically kick in after short-term disability benefits and Employment Insurance benefits have been exhausted, usually after several months. They provide a monthly income, usually between 60% to 85% of your gross income, until you can return to work or reach the age of 65.

 5 best Long-Term Disability Insurance Providers in Canada

Sun Life Financial

Sun Life Financial’s long-term disability insurance policy stands out because of its customizable nature. With Sun Life, you can choose the benefit period (up to age 65), the waiting period (90 to 720 days), and whether the benefits are indexed to inflation. Also, Sun Life’s coverage includes the ‘Own Occupation’ provision and provides rehabilitation and return-to-work assistance.

Desjardins Insurance

Desjardins Insurance offers a comprehensive long-term disability plan with several standout features. Desjardins’ coverage includes ‘Own Occupation’ protection and an automatic benefit increase to account for inflation. The plan also has a unique feature called the Compassionate Care Benefit, which provides coverage if you need to take time off work to care for a gravely ill family member.

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Manulife Financial Corporation is one of the largest insurance providers in Canada and offers a comprehensive long-term disability insurance plan. Manulife’s Venture Series offers both long and short-term disability coverage. The plan is unique in that it offers Own Occupation coverage, meaning you’ll receive benefits if you’re unable to perform the duties of your own occupation, not just any occupation. Manulife’s coverage also includes rehabilitation and vocational services to help you get back to work when ready.

RBC Insurance

RBC Insurance, a subsidiary of the Royal Bank of Canada, offers a solid long-term disability insurance plan. With RBC, you can opt for ‘Own Occupation’ or ‘Any Occupation’ coverage and choose your benefit period and waiting period. Additionally, RBC’s policy has features such as partial disability benefits, which provide a portion of the disability benefit if you can work part-time but not full-time.

Canada Life

Canada Life’s long-term disability plan, the Lifestyle Protection Plan, provides coverage up to 85% of your income. The plan includes both ‘Own Occupation’ and ‘Any Occupation’ coverage and offers flexible waiting periods. An added bonus is the Future Earnings Protector, which accounts for future income growth you might have experienced if not for your disability.

Choosing the Right Long-Term Disability Insurance

Choosing the right long-term disability insurance involves considering several factors:

  1. Coverage: Look for a policy that covers the specific risks you are most concerned about. Some policies might cover a wider range of illnesses and injuries than others.
  2. Benefit Amount: The benefit amount should be enough to cover your living expenses, and potentially more, depending on your financial commitments.
  3. Waiting Period: This is the time you have to wait from when you become unable to work until when your benefits start. A shorter waiting period means your benefits start sooner, but this typically comes with higher premiums.
  4. Policy Term: This refers to how long the policy will provide coverage. Some policies will providing benefits until you reach a certain age, typically 65, while others may only provide benefits for a fixed period.
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  1. Premiums: The cost of the policy is a significant factor to consider. Premiums can be paid monthly, quarterly, or annually, and they should fit comfortably within your budget. Also, consider whether the premiums are level (stay the same over the policy term) or are likely to increase as you age.
  2. Exclusions and Limitations: Be fully aware of what the policy doesn’t cover. All policies have certain exclusions and limitations, and it’s important to understand these before purchasing.
  3. Future Increase Option: This allows you to increase your coverage in the future without having to provide evidence of good health. This is a useful feature if your income is likely to rise significantly in the future.


In Canada, long-term disability insurance provides a financial lifeline if an injury or illness prevents you from working. Top providers, including Manulife, Sun Life Financial, RBC Insurance, Canada Life, and Desjardins Insurance, offer comprehensive plans with unique features to meet various needs.

Choosing the right long-term disability insurance policy depends on your personal circumstances and financial needs. It is recommended to work with a knowledgeable insurance advisor who can help navigate the complexities of different policies and ensure you secure a policy that provides the protection you need at a price you can afford.

Long-term disability insurance is an essential part of financial planning. It provides peace of mind knowing that if the unforeseen happens, you have a financial safety net in place to protect you and your loved ones. By thoroughly understanding your options and making an informed decision, you can ensure that you’re well protected, no matter what the future holds.

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