Why do I need critical illness insurance?

Updated:
October 31, 2019

As a small business owner, Harry Thistlethwaite constantly ran "what if" scenarios through his head.

What happens if I come down with a serious illness or major injury? Would my business survive? What would my family do?

Harry decided to purchase a critical illness insurance policy simply as a precaution. "I'll never need it," Harry told himself.

Harry wasn't overly concerned when he discovered a lump in his neck, but his doctor decided to order a biopsy to test for cancer. To Harry's shock and dismay, the test came back positive for lymphoma.

Because he had critical illness insurance, Harry was awarded a large lump sum to help cover expenses, including those related to keeping his business afloat, while he was going through treatment.

Critical illness insurance doesn't replace an individual's provincial medical insurance (ie. OHIP), it simply adds an extra level of financial protection if you are diagnosed with a critical illness. And since the money is paid directly to you, you'll be able to spend it on whatever you decide is the biggest need; rent or mortgage payments, out of the country treatment, medical equipment, private nursing, bills, etc.

"We went through all sorts of scenarios," said Harry. "Should we sell the business? Should we partner up? Does the existing staff have the ability to carry on? These are big pressures, but this insurance takes some of that pressure off."

It wasn't always easy, but today Harry is both a cancer survivor and the owner of a thriving business - thanks, in part, to his fortuitous decision to purchase critical illness insurance. "I can't imagine what it would have been like not to have it."

To obtain more information on critical illness insurance, contact Scrivens today!

FAQs

What is financial advising?

Financial advising involves providing guidance and advice to individuals, families, or businesses to help them make informed decisions about their financial matters. This can include various aspects such as investment planning, retirement planning, tax planning, estate planning, and more. Financial advisors analyze their clients' financial situations, goals, and risk tolerance to create customized strategies that align with their objectives.

Why is financial planning important?

Financial planning is crucial for several reasons:

Goal Achievement: It helps individuals set and achieve financial goals, whether they are short-term, such as buying a home, or long-term, like funding a comfortable retirement.

Risk Management: Financial planning addresses risks by considering insurance, emergency funds, and other protective measures.

Budgeting and Saving: It promotes responsible money management through budgeting and saving, fostering financial stability.

Wealth Building: Effective financial planning can lead to wealth accumulation and the creation of a secure financial future.

Can financial advisors help with debt?

Yes, financial advisors can help with debt management. They can assess your overall financial situation, create a budget, and develop strategies to pay down debt efficiently. They may also negotiate with creditors on your behalf, provide debt consolidation recommendations, and offer guidance on prioritizing and managing debt repayment.

What exactly does a financial advisor do?

The specific responsibilities of a financial advisor can vary, but generally, they:

  1. Conduct a thorough analysis of a client's financial situation, including income, expenses, assets, and liabilities.
  2. Develop personalized financial plans based on the client's goals, risk tolerance, and time horizon.
  3. Provide investment advice and portfolio management services.
  4. Offer guidance on retirement planning, estate planning, tax planning, and insurance.
  5. Monitor and adjust financial plans as needed based on changes in the client's life or market conditions.
  6. Educate clients on financial matters and empower them to make informed decisions.
What is the average fee for a financial advisor?

The fees charged by financial advisors can vary widely based on factors such as the advisor's experience, the services provided, and the region.

Common fee structures include:

Hourly Fees: Advisors charge an hourly rate for their services.
Flat or Fixed Fees: A set fee is charged for specific services or a comprehensive financial plan.
Asset-based Fees: Fees are a percentage of the assets under management (AUM).
Commission-based Fees: Advisors earn commissions on financial products they sell.
Combination of Fees: Advisors may use a combination of the above fee structures.
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It's important to discuss and clarify fee arrangements with a potential financial advisor before engaging in their services.