In any business a business owner must manage risk.  One area many entrepreneurs find themselves exposed is in the area of debt cancellation or business continuation if a key member (owner/operator) becomes seriously ill.  Life Insurance is understood by most but what if a business owner suffers a serious illness, can not work and the business revenue/profit is negatively affected.

Critical Illness coverage has been designed so if you suffer a serious illness and survive 30 days after being diagnosed you would have a benefit paid to you – tax free*.  This benefit could be used for whatever you wish but most importantly it could keep your RRSP or investments in-tact while; your spouse and you are off work, you seek special private treatment in the US, you pay off your debt or it could be used to take the vacation of a life time. 

Some contracts even offer their policy holders the ability to get a percentage of their premiums back or ALL of the premiums back if no claims are made.  As well, if you pass away and have not made a claim the premiums are paid back to the estate of the deceased.

Some of the illnesses typically covered on a CI policy are as follows:

• Heart Attack
• Stroke
• Cancer
• Alzheimer's Disease
• Loss of Limbs
• Aortic Surgery Major Organ Failure on Waiting List
• Bacterial Meningitis
• Major Organ Transplant
• Benign Brain Tumour
• Motor Neuron Disease
• Blindness
• Loss of Speech
• Aplastic Anaemia
• Occupational HIV Infection
• Coronary Artery Bypass Surgery
• Paralysis
• Deafness Multiple Sclerosis
• Coma
• Parkinson's Disease
• Heart Valve Replacement
• Severe Burns
• Kidney Failure

In a business application this coverage could be used for partners.  If one partner were to become ill and unable to work, the business may be affected.  The healthy partner may want to buy the ill partner out and the most cost effective way to do that without a built up slush fund is through insurance coverage.

For more information on how we help business owners explore these and other types of risk, feel free to contact one of our advisors today.

The Peacock Sheridan Team

*Note there are many types/carriers of critical illness coverage and rates can change without notice, so seek advice from a professional insurance advisor.