Professional Referrals

professionalreferrals – Blogs on financial planning and financial advising

Author: Nora Cole

All About Merchant Cash Advance And Cause Of Their Ever-increasing Popularity

A merchant cash advance, otherwise called a business loan is a kind of minimal period, unbound business capital. They are a characteristic option in contrast to the conventional business advance and are a relative amateur category to the business finance world, having existed for a couple of years. 

These are the conceivably perfect answer for entrepreneurs who take a sensible extent of their pay through cash or by traditional method.

merchant cash advance canada

The basic working procedure of merchant cash advance

Although they are utilized for a similar reason, business cash advances work in a somewhat extraordinary approach to standard business credits. At the point when you take a trader loan, you are viably selling your future card deals at a rebate to get to the cash sooner. 

Reimbursements are then taken day by day, by reimbursing the extent of your everyday card deals straightforwardly to the lender consequently, through your card takings. 

Reimbursements are in this manner connected to your future card receipts, which means if your card takings are low, the sum reimbursed that day will be lower. On your more grounded days, you will reimburse more. This implies, not at all like business advances, there is no set reimbursement term for a vendor loan. Merchant advance cash Canada has been very popular in this sector.

merchant cash advance canada


  • Your reimbursements dealt with for you by the moneylender. They deduct a specified level of your takings, and you get the net figure, implying that when the cash lands in your bank, there are no more installments to make. 
  • You take care of low repayments during calm periods, which means it’s constantly moderate. During your good weeks or months, your installments lessen. When acquiring through a business loan, your reimbursements continue as before every month, which means it could get excessively expensive. 
  • As your business develops, so can your office. Where a getting need remains, you can adequately develop your office by your business development. 
  • Merchant loans can be organized rapidly, which is perfect when you need assets to support a quick and startling occasion. Financing can frequently be organized in as little time as 24 hours. 
  • You realize precisely the amount you need to reimburse, which means the expense of acquiring is obvious from the beginning.
merchant cash advance canada


  • If just a little extent of your takings are taken through your card terminal, you might be not able to secure the degree of financing you need, regardless of whether it is reasonable. 
  • It is solely on the card terminal supplier you use, you might be limited in your selection of moneylenders. This could bring about you taking out more costly subsidizing than is extremely vital. 
  • Important focus to consider before taking out a business loan 
  • Before taking out any type of fund, it’s significant that you consider each likelihood to guarantee you’re settling on the correct choice. 

At last, the question remains ‘is merchant cash advances are the best option?’ The term offered is minimal for conventional business loans. If you are susceptible to the repayments in a shorter period, then you can convert it to longer periods easily which is much preferable.

What Happens at the Cancellation of a North York Condo Project?

It was bad news for the buyers of UrbanCorp’s Kingsclub condos as the developer turn about on their building plans. North York condo rentals will replace these condos for sale in North York in King West. It was a move that staggered 181 buyers. Long back in 2011, many bought these pre-construction condos of King West and have been waiting eagerly that the project stalled out. The plot was just entering the early stages of foundation work. Purchasers were expecting an update from the builder about delays but found the project been cancelled.

condos for sale in north york

What may be the reason for cancellation? Seemingly, the builder did not get funds for the original project but there is no formal declaration on UrbanCorp’s website. Just like the silent cancelling of The Selby at Bloor and Sherbourne a few days before Christmas, builders of condos for sale in North York are trying to step down from projects quietly with fewer media and legal fuss. But the Selby was running in its first month of sales and there could not be many units sold out. So the effect of that declaration was less on consumers. The UrbanCorp case is much different because they were almost sitting on purchaser’s down-payments for a long time and tying their hands from buying anything else. It was not done on purpose of course but the damage to the purchasers is real.

condos for sale in north york

Repaying won’t be enough to conciliate most buyers

Buyers will get their funds back with interest but that interest would be almost minimal. The contracts of the developers refer to the Bank of Canada’s overnight rate as their highest need. Thanks to the latest announcement of BOC for breaking down the rate to 0.75 percent. Hence, the translation of a 20000 dollars investment for three years back is just 20,453 dollars. No one knows about the higher interest rate given in UrbanCorp’s contracts. But in terms of potential earnings, chances are that the interest does not come close to the real losses of buyers.

Think on how much these investments had grown if the buyers would have purchased condos for sale in North York back in 2011. And besides the lost value acknowledgement, purchasers are now experiencing a much more uncooperative North York condo market than they were 3 years back. Hence, the purchasers have to pay more now to buy a similar unit in the other building then had the project not been taken back or had they moved to buy re-sale instead at the time.

condos for sale in north york

Your legal ground is trembling at best

This unfortunate event underlines the problem involved in purchasing on spec and why pre-construction is not a good investment always. If you are an unlucky purchaser of the Kingsclub condos or have bought a different pre-construction North York condo for sale and are worried that this can happen to you as well. What are the legal consequences? The lawyer Mark Youngman says about the matter that the builder is under no commitment to repay buyers beyond the amount mentioned in the purchase agreement that surely includes a section about potential project cancellation if sales are less, offering it adheres to Ontario condominium law. Even though the interest rate given on the contracts is less than that stated in Ontario condo law, then the purchasers need to fight for that additional amount.

Why Investment In Gold Is Beneficial?

To know if gold is a good investment, it is important to understand why people decide to buy it. In times of uncertainty and economic instability, the purchase of gold makes more Sense than the purchase of other resources. Trusting that the banking system and the world economy will continue with the current historical collapse, investment gold could be the best way to secure part of their portfolio of securities. Currently the demand for the famous gold metal is extremely high. Possession of gold can be one of the best ways to preserve your assets and even make a profiting these uncertain times. We all have the same doubt that has remained presenting our society for centuries: how can I guarantee the protection of my savings? And more and more people continue to choose for the oldest answer: buy gold canada

buy gold canada

10 reasons to invest in gold

1. It is the element of value that humanity has naturally adopted for more than 5,000 years.

2. Investing in gold is exempt from paying VAT provided that it is physical gold, i.e. bullion and coins.

3. It is not devalued by any government.

4. Physical gold has been the best vehicle to preserve value and maintain wealth over time.

5. In situations of instability and uncertainty, gold is a good refuge for our heritage.

buy gold canada

6. If purchased in times of top prize, it can cover bad times. In times of economic recession the difference can be made by the gold that we have accumulated in the good times.

7. It can be converted back to money anywhere in the world in any currency. It has immediate liquidity and we will always have a buyer, it does not depend on the markets.

8. It can serve as a complement to the pension plan or an alternative to it.

9. You can start investing in gold from less than 50 Euros in 1 gram weight bullion.

10. As a gift, it is original, elegant and different.

Other reasons to Buy Gold Canada

•  Gold is perfect for long-term investments

•  Controls stability of the precious metal

•  Rising demand

•  Safe value

buy gold canada

How to invest in gold?

To know how to buy Gold in Canada, certain factors must be taken into account in addition to the money.  They will invest, how is the price of gold, the projections of the value of gold and whether or not to bet on gold. Although when its price is rising in the year and the projections give next increases surely it is convenient to buy. As with any investment, you have to be aware of the fluctuations of the market and the economy before and during the investment.

To invest you have to search from a bank that offers this option or a portal that allows you to buy and invest in gold. Luckily there are several options to invest in gold, although like buying coins minted by governments or buying bars or sheets. As well as buying pure gold in coins with denomination of small amount.

What Are The Advantages Of The Various Door And Fiberglass Doors

Door fiberglass was introduced in the 90s and attracted much attention to its low maintenance function, good looks, efficient energy and weather resistance. Today, some home builders and carpenters believe that these fiberglass doors are better than traditional wooden doors. In addition, these doors have fewer scratches and dents than wooden doors. The installation of these doors is especially advantageous if you are looking for a durable and low maintenance door.         

fiberglass doors

However, there are always high-quality products and low-quality products on the market. In the case of fiberglass, choose a superior quality and its poor quality that loses its shine because it is very important and is easily damaged. Installing one of these is a considerable investment and needs to be thoroughly analyzed to save you from low quality issues.        

Main uses Gate fiberglass:

As the main entrance:

Currently, fiberglass doors are widely used for various purposes. They are most often used as main entrances, especially in areas where extreme weather conditions are observed. They are used in these areas because they are weatherproof and, unlike wooden doors, do not deform or expand due to moisture or heat. A common practice is to paint while using these doors as entrance doors to prevent rusting and deformation. However, this is not necessary because these doors are already polished to minimize the appearance of patches such as water.      

fiberglass doors

As an internal door:

Fiberglass doors doors are also widely used in interiors such as room doors. The main advantage of using indoors is the appearance and the charm to add. In addition, glass fiber doors are scratch resistant and are ideal for indoor use, especially when children are at home. However, good quality fiberglass doors are usually more expensive than wooden doors and cannot be used indoors.         

Use as patio door:

Another common use is to install it as a patio door. However, you will always want to have a strong, weatherproof and elegant patio door that gives your home the ideal look you want. The glass fiber of the door is smooth for use with the slide down. It is less susceptible to damage and scratches than a sliding patio door and has a longer life.      

fiberglass doors

Simply put, fiberglass doors are more intelligent and durable, both exterior and interior. They sometimes prevent the swaying of cleaning the doors, and for weatherproof quality, they can stay there for over 10 years. In addition, unlike wooden doors that begin to deform when painted frequently, they can be painted many times to match the decor. Another fact worth mentioning is that fiberglass green is the ideal choice for doors to use because door fiber glass is for those who want to be environmentally friendly.               

Learn more and add great ideas about home renovation products such as the best entrance doors and a variety of custom entry doors that can be used for any shape and size house.  

What the HST means to you

What the HST means to you

From children’s sports activities and home renos to simply driving around, life is about to get more expensive in Ontario.


On July 1, the Ontario government will introduce the new Harmonized Sales Tax (HST). This means that certain purchases that were only subject to the 5% Goods and Services Tax (GST) before this date, will soon be subject to the 13% HST instead.

While the effect will be minor on certain items, it can make a huge difference on bigger ticket items and you should prepare yourself and take advantage of the window of opportunity that exists before July 1.

You can visit the website of the Ontario Ministry of Revenue for a detailed list of the products and services that will be subject to or exempt from the HST at

The following are the major changes that you will experience as a consumer and some financial planning tips for dealing with the upcoming changes and minimizing their impact.

Food and Beverages

Food and beverages are a major expenditure for most families. The good news is that no HST will be charged on basic groceries. Qualifying prepared food and beverages sold for $4 or less will also be only subject to the GST.

The bad news is that alcohol beverages – currently subject to a 10-12% Retail Sales Tax rather than the 8% Provincial Sales Tax – will not go down in price despite being subject to the HST after July 1. This is because the Liquor Control Board of Ontario (LCBO)’s policy of “social responsibility” dissuades a price reduction to keep alcohol abuse and drinkdriving in check.

Home Services

The services in this category that will be subject to HST include electricity and heating, Internet access services, home service calls by electricians, plumbers, carpenters, as well as landscaping, lawn-care and private snow removal services.

While you cannot do much about your ongoing electricity and heating bills, you’d better fix your leaky faucet, repair your furnace or electrical wiring and put your lawn maintenance and snow removal contracts in place before July 1 to save the additional 8% you would need to pay on these services.

RRIFs vs Annuities?

RRIFs vs Annuities?

Selecting between a RRIF or an annuity could be your most important retirement decision.

RRIFs are now favoured over annuities by most retirees contemplating their RRSP maturity options. In making the decision between a RRIF and an annuity, the following factors should be considered:

Guaranteed Payments

This is perhaps the biggest advantage of an annuity. With an annuity product the holder is guaranteed a regular, fixed payment for life. For those with limited funds the guarantee feature of annuities can be very important.

Future Inflation

Considering the affects of future inflation, the guarantee advantage of annuities becomes somewhat diminished. The increase in the costs of living could erode the worth of the annuity payments. RRIFs may provide better protection due to their function as an investment vehicle, in which the holdings may continue to grow through the return of income, interest and capital gains. Thus the holder of an annuity pays for the guarantee feature by having to accept a lower return than they might have with a different investment.


RRIFs offer flexibility through a range of investment options. The holder of a RRIF retains control over his investments and may select among shares listed on Canadian exchanges, bonds and mutual funds, Canadian mortgages, Treasury bills, CSBs, and so on. This is particularly attractive to those retirees who want to remain active in the investment decisions of their estate assets.


RRIFs offer withdrawal flexibility. There is a set minimum amount that must be withdrawn from a RRIF every month; otherwise any amount may be withdrawn, affording the individual flexibility in meeting unexpected demands on finances or other emergencies. While some annuities may be collapsible, there may be economic penalties built into annuities with this option.

Tax Considerations

Interest, income and capital gains accumulate in a RRIF investment on a tax-deferred basis, similar to the investments in an RRSP. Assets in RRIF will continue to grow as long as the individual wishes, allowing an individual to maximize the value of the fund by postponing withdrawals to a future time.


There are pros and cons to both RRIFs and annuities and the choice between the two must be made based on an individual’s personal situation. The following are some general guidelines on which maturity option may be best:

  • If an individual has considerable financial resources available and does not need the protection feature of a life annuity, he or she should seriously consider a RRIF.
  • If an individual foresees the need for emergency funds during retirement, he or she probably should choose a RRIF that allows for flexible withdrawals. A compromise might be to purchase both types of plans. Whatever may be required for emergency purposes could be placed in a RRIF and the remainder invested in an annuity.
  • For those who wish to retain control of their investments, the RRIF is the answer. Consider that whereas sound management will increase the size of the retirement benefit, a downturn in the economy or an unwise investment decision will have the opposite effect.

On the other hand, an individual may welcome the freedom from the worries of managing their own investments, in which case the guarantees of an annuity will seem more attractive.

Perfect Time to revisit Registered Education Savings Plans

Now that the kids are back to school, it’s a great time to talk about the recent changes to Registered Education Savings Plans (RESPs). Changes to RESPs at both the federal and the provincial level, make RESPs a more attractive option than ever for saving towards your children’s education. This summer, the government passed the following changes:

1. More free money. Previously, contributors would get the Canada Education Savings Grant (CESG), which is 20% for every dollar contributed up to a maximum of $2000 of contribution per year. Effective this year, the government has increased the CESG to a maximum of $2500 per year of contribution per year. The government would contribute $500 of CESG based on a maximum $2500 contribution. In my case, I have three children which means I can contribute as much as $7500 for all three kids and the government would put in $1500 for a total contribution of $9000. The maximum CESG that each child can get in a lifetime is $7200 remains unchanged. That means I can contribute the maximum ($2500) for fourteen and a half years to maximize the grant money from the government.

2. Catching up on previous years contributions. If you have not made contributions to the RESP in previous years, you are allowed to do some catch up. The government allows you to contribute a maximum of $5000 per year per child and qualify for the CESG on the entire contribution. In other words, you can only catch up one year at a time. In my case, although I have three children, Jason was born in 2007. Thus, he would not be eligible for contributions for 2006. If I had not made RESP contributions in the past, I could contribute a total of $12,500 for my kids ($5000 for Robbie, $5000 for Connor and $2500 for Jason).

3. No annual maximum contribution. Although the maximum you can contribute to the RESP and still qualify for the CESG is $5000, you can contribute as much as $50,000 lump sum. However, in doing so, you waive your future CESGs. In other words, ff I contributed $50,000 for my youngest son Jason who was born in 2007, I would get the CESG for 2007 or $500. However, no future CESGs would be available. On one hand, I would get tax deferred compounding for Jason for the next 20 years but I would lose $6700 of CESG from the government. I think I would opt to invest the $50,000 into a non-RRSP investment into tax efficient investments and stream $2500 per year into the RESPs to get the CESG grant money.

4. Alberta Centennial Education Savings Plan (ACES). For Alberta only, the government will contribute $500 into an RESP for children born or adopted by an Alberta resident beginning in 2005. The Alberta government will contribute an additional $100 for children when they turn 8, 11 and 14. In my case, I have two of the three kids that were born 2005 and later which means I qualify for $1000 from the Alberta government. Although my oldest, Robbie was born prior to 2005, he will still get the $100 when he turns 8, 11, and 14. All you have to do is open up an RESP and contribute something to the plan to qualify. This grant money and earnings is transferable among siblings.

So there you have four great reasons to start contributing to RESPs. Anyone like grandparents, uncles and aunts can contribute to a child’s RESP but remember these limits discuss are for each child. Make sure there is some communication with the parents if you want to contribute to the RESPs.

Value of Home Improvements

Value of Home Improvements

You may be thinking about those spring-time projects that you will need to tackle this year, like landscaping the garden, rebuilding a patio or fence, changing older windows and doors, a new roof, or even remodeling your basement, kitchen or bathroom. If you tune in to some recent popular TV programs like “Extreme Makeover – Home Edition”, you will surely catch the home makeover bug. If you live in a freehold house, you should be spending an average of 1% of your home value annually, on maintenance, just to keep it in good repair and to prevent it from declining in value, according to “Home Buying for Dummies” by Eric Tyson and Ray Brown.

Renovating a home, may also be an important consideration for you in 2010, if you are thinking of listing your home for sale. Remember that the right renovations can help you to maximize the resale value of your home. The renovation payback statistics were extracted directly from the Appraisal Institute of Canada’s website and the data is current as of January 2010:

Top Four Renovations that will give you the Highest Payback Potential
Bathroom Renovation75% – 100%
Kitchen Renovation75% – 100%
Exterior Paint50% – 100%
Interior Paint50% – 100%
Other Renovations Payback Potential
Basement Renovation50% – 75%
Construct a Garage50% – 75%
Exterior Siding50% – 75%
Flooring Upgrade50% – 75%
Furnace/Heating System Upgrade50% – 75%
Install a Fireplace50% – 75%
Recreation Room Addition50% – 75%
Window/Door Replacement50% – 75%
Build a Deck25% – 75%
Concrete Paving25% – 75%
Install Central Air Conditioning25% – 75%
Roof Shingle Replacement25% – 75%
Nine Renovations that will give you the Lowest Payback Potential
Asphalt Paving25% – 50%
Build a Fence25% – 50%
Install a Home Theatre Room25% – 50%
Interlocking Brick (walkways)25% – 50%
Interlocking Paving25% – 50%
Landscaping25% – 50%
Install a Whirlpool Tub0% – 50%
Install a Skylight0% – 25%
Install a Swimming Pool0% – 25%

You can check your renovation investment plans using the Appraisal Institute of Canada’s on-line tool. The name of this tool is RENOVA and it is an excellent resource for homeowners. You may visit the site by going to this website:

Remember that the referenced website link is only a guide, and you should always carefully consider that proper appraisal values and returns can be provided by an accredited appraiser holding a CRA or AACI designation. It is also important to mention that an appraiser will also assess other factors, about the home to complete accurate appraisal results, for example, the neighborhood, recent real estate activity, lot, location, etc.

Canada AM has been running an informative real estate market series that commenced on January 25, 2010. Featured on Tuesday’s program was Mr. Ed Saxe of Edjline Appraisal Services. Mr. Saxe is a certified Canadian Residential Appraiser as well as the President of the Ontario Association of the Appraisal Institute of Canada. Mr. Saxe discusses that the number one investment returns come from kitchen and bathroom renovations, however, as a homeowner, he advises that discretion is required when spending. Mr. Saxe advises homeowners to carefully consider just how much they are spending and where they are spending. For example, he mentions that you would not be wise to spend $50,000 on a kitchen renovation if you are living in a home that is only worth $200,000. A home renovation should be relative to the market and the neighborhood in which you live. You can view the current live video clip at the following link:

What is an employee benefit really worth?

What is an employee benefit really worth?

In early 2007, Ian Wright, a lawyer and partner at Scott, Petrie, Brander, Walters & Wright LLP, in London, Ontario approached our firm with an insightful query. Ian, an employment lawyer, believed that the way employee benefits had been valued by legal counsel across Canada over the decades was inadequate. He intuitively knew that the methodology to calculate the true cost to employees of losing employee benefits when they were let go or left their place of employment, had not fully represented the true monetary value of the loss.

The issue that Ian had with the traditional method of valuing lost employee benefits centered on the fact that it did not represent what it would cost the former employee, as an individual, to purchase comparable benefits privately and at the same time place him or her in the same financial position as before his or her employment ended.

Issues that the traditional approach neglected to address include:

  • Employers are able to deduct their employee benefit contributions as a business expense while their employees receive these same benefits either tax-free or tax-deferred. If the same or similar benefits were purchased by a former employee privately, this individual would have to pay with his or her after tax dollars, leaving fewer dollars in the pocket of the affected former employee.
  • Employers are able to buy employee benefits at a reduced cost from insurance companies or other benefit providers because the cost of administration and risk of loss/cost of paid out benefit for these providers is spread out over a number of employees who form the group. A former employee would not enjoy such an economy of scale or dilution of risk. Instead, a former employee would be insured only on an individual basis. For such individual coverage, there is no dilution of the risk of loss to an insurance company or other benefit provider and any such provided would have proportionately higher costs of administration. As a result, a former employee would pay a substantially greater amount per benefit than those same benefits cost the employer and there is a question as to whether some of those benefits would even be available to an individual.
  • Lastly and of critical importance, the vast majority of employee group benefit plans do not discriminate whether someone is healthy or not and/or whether someone is a smoker or not. However, this does not apply when an individual applies privately for individual medical and dental, critical illness, short and long-term disability, long-term care or life insurance coverage. For example, smokers will pay substantially more for individual insurance coverage than if they were a part of group coverage. And for former employees who have health issues, there is the very real prospect that they will not qualify individually and will be denied coverage altogether.

Ian affirmed that the financial matrix used to show the true monetary value of a lost employee benefit should be represented in the total compensation in an employee’s severance package and furthered his argument with the following sound legal precedents:

  • The Ontario Court of Appeal in Davidson v. Allelix Inc., [1991] O.J. No. 2230 confirmed the law in Ontario is that a wrongfully dismissed employee may claim, in addition to lost salary, the pecuniary financial value of lost benefits flowing from such dismissal.
  • Soon after the Davidson decision, the case of Alpert v. Les Carreaux Ramca Ltee [1992] O.J. No. 769 concluded that the dismissed employee, Mr. Alpert, was entitled to compensation for the loss of coverage under the employee medical plan “ … calculated by reference to the cost to the defendant [employer] of maintaining the plan in favour of Mr. Alpert.”  NOTE: this method of calculating the compensation for the loss of coverage was suggested by Alpert’s counsel.
  • The Alpert decision was followed in the Connolly v General Motors of Canada Ltd. [1993] O.J. No. 2811, where the judge although dismissing the claim of the dismissed employee because the employer had cause to terminate Connolly, nevertheless went on to conclude that on the issue of compensation (had Connolly been wrongfully dismissed), “… the measure of the ‘pecuniary value’ was the amount the employer would have had to pay to maintain the benefits for the benefit of the employee during the notice period.”
  • However in the case of Habraken v. MacMillian Bathurst Inc. [1995] O.J. No. 1951, the court was again faced with the issue of valuing the dismissed employee’s benefits for the reasonable notice period.  The court noted that “No specific evidence was offered as to the value of these benefits to the employee or the cost to the employer.”  NOTE: In Habraken both employer and employee requested the court “to calculate these damages according to a percentage of the plaintiff’s annual salary of $46,500.”

In conclusion

The true value of a lost employee benefit is not a rote calculation. It is vitally important to determine with some accuracy the higher cost to a former employee of replacing lost benefits with similar benefits. These replaced benefits are paid for with after-tax dollars based on the former employee’s marginal tax rate. It is also important to determine whether certain portions of the lost benefits may not be available to an individual privately for any reason. As a result, the actual financial compensation for the lost benefits, which mitigate a former employee’s loss, becomes much greater than has been traditionally provided.

It is well worth the time and the investment to hire an expert in group employee benefits, with credentials and experience, to complete a proper evaluation of the true cost of lost benefits to a former employee. Under the circumstances, the sizeable benefit is definitely worth the marginal cost.

How Critical Is Critical Illness Insurance For Your Business

Imagine one day you have a massive heart attack and can’t come to work for weeks. What would happen to the day to day operation of your business? Who would pay the wages, write the cheques to pay the bills, deal with client concerns and most importantly generate new business?

While you may be in perfect health now, a critical illness could be right around the corner for any of us. According to the Heart and Stroke Foundation, “About 50,000 strokes occur each year in Canada and over 15,000 Canadians die as a result.  Three hundred thousand Canadians are living with its effects.  Stroke costs the Canadian economy about $2.7 billion a year….cardiovascular diseases cost the Canadian economy over $18 billion a year.”

The fact of the matter is that there are over 70,000 heart attacks in Canada each year and heart disease and stroke are the underlying cause of death for one in three Canadians.

While the prevalence of these diseases in Canada is at an astoundingly high level, the good news is that the number of people who die from heart disease, stroke and cancer has decreased in recent years.  For example, according to the Canadian Cancer Society, while women have a 1 in 9 chance of developing breast cancer, they only have a 1 in 27 chance of dying from it.  In men’s case, while there is a 1 in 7 chance of developing prostate cancer, there is only a 1 in 26 chance of dying from it.

As a matter of fact, according to Manulife, you have a greater chance of getting a critical illness before you reach 75, than you do of dying.  This means that from a risk management perspective, insuring yourself against the risk of coming down with a critical illness is just as important and could be even more important than insuring yourself against the risk of dying during your working years.

A critical illness insurance policy can provide a lump sum tax free payment to help you pull through the financial hardship that a critical illness can create for you, your family and your business.

In addition to needing funds to replace your lost income (which may or may not be covered by your disability insurance policy, as you may not be able to qualify for the 90 or 120 waiting period that most disability insurance policies impose before starting to pay the claim), you may need  money to pay for the following:

•    Drugs or a course of treatment not covered by your provincial health insurance plan
•    Treatment in the U.S. or abroad
•    Cost of lodging and travel to and from treatment centers outside your area of residence
•    Renovating your home to accommodate a wheelchair or chairlift
•    Hiring a nurse to take care of you at home

If you have a partner in your business, you should seriously consider funding your partnership or shareholder agreement with critical illness insurance policies so that the business can receive a lump sum benefit to compensate for the loss of a key person during the period of medical treatment.

Most critical illness policies allow you to add a rider at an extra cost that will enable you to cancel the policy after 15 years and get a full refund of your premiums if you have never made a critical illness claim.  Many companies also let you add a rider at an extra cost that will ensure your beneficiary gets all the premiums you paid for the policy in the event that you die while the policy was in force and before making a claim on the policy.

The pricing of critical illness policies depends on your age and health.  However, your family’s health history also plays an important part in the underwriting decision. Therefore, if you are in perfect health yourself but have two or more immediate family members who have been diagnosed with cancer, stroke or heart attack at early ages, you may end up having to pay a higher premium for your policy as the insurance company will consider you at higher risk of coming down with one of those illnesses due to your family history.

Therefore, the sooner you look into assessing your need for critical illness insurance, the higher the chances that you can get approved at more favourable rates and of course the sooner you can transfer the risk to the insurance company.

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