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Half of Canadians financially unprepared to be off work

By Andrew Rickard | February 18 2016 01:35PM

RBC Insurance says its research has uncovered a "perfect storm" brewing for disabled workers.

A recent poll conducted by RBC Insurance has found that 48% of Canadian workers say they weren't financially prepared to be off work due to a disability and 78% said that finances were tight. Being off of work also had an emotional cost for families; 67% said the situation was stressful for their household, and 50% said that their family relationships were strained. What's more, 31% of those who had to leave their jobs because of a disability said that their able partner had to find extra work to make ends meet.

Dipping into savings

Asked how they managed financially during the disability, 29% of the respondents said they had to dip into their savings to pay for expenses, while 17% had to take on more debt, 17% borrowed money from family and friends, and 9% needed to cash in their RRSPs. Those who did not have insurance coverage had a very difficult time, with more than 60% saying that they were in “rough shape” while off work and described the period as “financially terrible”.

Disability coverage

"Canadians want to work and live healthy, productive lives, but with one-in-three experiencing a period of disability lasting longer than 90 days during their working lives, Canadians need to take steps to ensure they're prepared and protected" says Mark Hardy, director of living benefits at RBC Insurance. "When faced with a disability, many people are shocked to find that their employee benefit plans have limited coverage. Having a solid picture of your financial situation and knowing what disability coverage you have are essential first steps, so you don't have to deal with a big drop in income at the same time that you're dealing with a disability."

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