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Reading the fine print: Getting the most out of your Long Term Disability Policy or Mortgage Insurance Policy (Ontario)

Hey Brian Goldfinger: Where do you draw inspiration for your topics on the Toronto Injury Lawyer Blog?

Great question!

I draw inspiration from my clients, colleagues, cases, associates and every day experiences as a personal injury lawyer. No day is ever the same. While I cannot comment on specific cases at my law firm; I can certainly draw parallels to those general experiences to share with the public which makes for engaging stories to read.

One such parallel is the topic for this week’s installment of the Toronto Injury Lawyer Blog Post. It has to do with Long Term Disability policies and Long Term Disability claims. But, it can also be related to Mortgage Insurance Policies, Accidental Death and Dismemberment Policies, and Critical Illness Insurance.

Insurance companies are in the business of making MONEY. They are NOT charities.

The more premiums which insurers collect, and the less benefits they have to pay out, the more money insurers make. When insurers have to pay out more in benefits than the collect in premiums, then the insurer will not be as profitable as they would like.

Understanding this very basic principle is important to understanding how insurers work. This basic example does not take in to consideration any investment model, or re-insurance model where insurers also profit. It is simply a basic insurance business model.

Personal Injury Lawyers don’t write the policies which insurers sell.London-Head-Shot-Brian-Goldfinger-201x300

The average consumer who buys insurance (LTD, Critical Illness, Life, etc.) also does not draft these policies.

Insurers draft the policies. They are drafted in such a way as to favour insurers, and not everyday consumers.

When purchasing any form of insurance, it’s important to understand how your policy works to make sure that you’re not getting fleeced. I use that term because some people pay very good money and believe that they’re covered; when in fact they’re not. The policy which they purchased is sometimes not even worth the paper upon which it’s drawn.

Sound harsh? Well, if you were throwing down $850/month for a mortgage insurance or long term disability insurance which you believe would cover you in the event of accident or injury only to find out it covers some things, but not others; you would be upset too.

Here is an example taken from a mortgage insurance policy purchased from a large bank at the time a nice father of 4 took out a mortgage for his lovely family home in Newmarket, ON.

At the time of purchase, the gentleman was told by the banker that it would be a smart investment to take out such a policy to give him and his family peace of mind that their mortgage payments and home would be protected in the event of serious injury.

Purchasing the policy sounded like the right idea at the time. Unfortunately, the policy was a rip off; plain and simple.

Instead of covering the policy holder for injuries if he could not work, it only covered him for certain injuries. And these injuries are not very common.

Here is a list of those “covered losses” taken straight from the Mortgage Insurance Policy. You tell me if they sound like something common:

If you suffered a “covered loss” as described below which:

  • is a bodily injury
  • is solely and directly caused by an accident; and
  • occurs within 365 days of the accident; and
  • is beyond remedy by surgical or other means

List of covered losses:

  • loss of both arms
  • loss of both legs
  • loss or one arm and one leg
  • loss of one leg and sight in one eye
  • loss of one arm and sight in one eye
  • loss of sight in both eyes
  • loss of use of both legs or all limbs due to paraplegia or quadirplegia
  • loss of use of an arm and leg on one side of the body due to hemiplegia
  • loss of an arm means that the limb is severed at or above the wrist joint
  • loss of a leg means that the limb is severed at or above the ankle joint

Pretty much everything else under this mortgage insurance policy is NOT covered.

That means if you break your back;have bulging discs; have a traumatic brain injury; fracture your skull; suffer from PTSD; anxiety; depression; have suicidal ideations, have blindness on only one eye, have the pussiest boils you’ve ever seen and can’t get out of bed…etc…you won’t qualify for benefits.

In a perfect world, there would be a personal injury lawyer there with you at the time you make the decision to purchase said insurance to explain to you how the policy works. This is supposed to be the insurance broker’s job. But, in this example, the insurance was purchased directly from the bank without the aid of an insurance broker. Perhaps the bank manager who sold the policy had a taken some insurance training or was a broker. Perhaps not. Perhaps there’s a breach of fiduciary duty claim here to be explored….

Either way, this customer who did not get what he bargained for at the time of purchasing his mortgage insurance. He paid premiums month after month. When it was time to make a claim after a serious car accident, his claim was denied because his injuries did not meet the onerous definitions of “covered loss” contained in his policy. The same scenarios ring true when it comes to purchasing a Long Term Disability Policy, Critical Illness Insurance Policy, Accidental Death and Dismemberment Policy. Knowing what you’re purchasing requires reading and understanding the fine print. Otherwise, you’re simply making a blind purchase whereby you don’t know what you’re getting yourself in to.

Getting a denial letter after a claim for benefits is completely devastating and totally demoralizing. It’s like getting hurt twice; once by the accident or injury itself which was beyond your control; and the second time by the denial letter.

Even though this situation seems dark and dire, countless people from across Ontario have turning to G0ldfinger Injury Lawyers to get them the benefits and results when they need them most. If you feel down and out because the cards seemed stacked against you, don’t fret. Get Goldfinger today.


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