Long-term disability - the COLA

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Transcript

Hi, my name is Alan freezin. I'm an employee benefit expert in southern Alberta. This is one of a series of tips that help you get the best value out of your employee benefit or group Benefit Program. This one Oh, first of all, you might say, hey, why is this guy call himself an expert? Well, there's three criteria that I use to determine if somebody knows what they're talking about. One is their training or education.

Two is their experience. And three, is this especially for that person? Or is this just a something they dabble in? So in my case, I believe I meet those criteria. Check me out on my on LinkedIn and look at my profile. I think you'll agree.

So here's my tip. Today I have a story to tell you the story of Mike. Mike is a tire man and he's a good tire man. He gets paid well doing it. So one Sunday afternoon, he's go out for a ride on his motorcycle and crashes his motorcycle unfortunately. So bad news.

He's crashed his motorcycle. Unfortunately, he's quite severely injured from that crash. Good news is he does have some disability coverage. So as long term disability coverage replaces his income while he's disabled, so that's good news. Now, because of the severity of his injuries, it's not a one year disability or a two year disability. It's many years of disability.

Now, his long term disability program doesn't adjust for inflation. He starts at 20 $800 a month, and he receives that 20 $800 a month forever, while in five years and 10 years and 15 years. What has happened with that 20 $800. Obviously, it's been eroded through inflation. Now there is a benefit that you can add to long term disability programs, called a cola cost of living allowance with a cost of living allowance, then his long term disability benefit, Mike's long term disability benefit would have increased with inflation. So that would have offset the effects of inflation and provided a better benefit in that terms.

Anyways, that's that's an idea. You can consider that for an add on to your group benefit program if you already have long term disability. If I can help you with any additional information, please do contact me. My contact information is on the screen or connect with me on LinkedIn. Also, you know, just another bonus tip is your health is your most important asset. So please take care of it.

Keep well thanks

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