April 8, 2020
We are here to help you through this difficult time. We have taken many calls and emails from members asking about insurance claims on their RBC insurance policies, how you can defer premiums during COVID-19, how to apply for insurance as well as questions on various government financial assistance plans. We have prepared this communique to help:
1. INSURANCE CLAIMS:
- Disability insurance
If you are quarantined and diagnosed with COVID-19, you are considered disabled and your policy will cover you. Self-isolation without a diagnosis of COVID-19 is not considered a disability. - Office overhead insurance
Office overhead insurance is designed to cover your business expenses in the event that you are disabled or injured; closing your clinic as a safety precaution is not covered under office overhead insurance. - Critical illness insurance
Critical illness insurance has defined definitions at the time a policy was purchased. COVID-19 is not a defined critical illness. - Life insurance
If you pass away due to COVID-19, your policy will pay to your beneficiaries.
2. RBC INSURANCE PREMIUM DEFERRAL:
RBC Insurance is offering a 90-day grace period for premium deferral until May 31, 2020 for policies issued before March 15, 2020. Specialists can request a deferral of up to 90 days, starting from their first missed premium, if they are unable to meet their premium commitments due to any of the following reasons:
- You have tested positive for COVID-19, are ill and/or in quarantine
- You are in quarantine due to travel outside of CanadaYou have lost their job, even if temporarily, due to layoffs or shut-downs of non-essential business
- You are caregivers for young children and are impacted by daycare and school closures or are caring for a family member with COVID-19
** Please note that clients whose policies were issued on or after March 15, 2020 or who own any UL policies that are not minimum funded or have a loan or are used as collateral for a loan are not eligible for premium deferral.
What is a premium deferral?
A premium deferral will extend your grace period as defined in the policy contract to a maximum of 90 days. During this time, premiums will be deferred without interest.
Who qualifies for premium deferral?
Clients experiencing financial hardship as a result of the COVID-19 pandemic because:
- You have tested positive for COVID-19, are ill and/or in quarantine
- You are in quarantine due to travel outside of Canada
- You have lost your job, even if temporarily, due to layoffs or shut-downs of non-essential business
- You are a caregivers for young children impacted from daycare and school closures or are caring for a family member with COVID-19
Does this criteria apply to Universal Life policies?
YES. Clients who have a Universal Life policy and who are paying the minimum premium are eligible.
Am I eligible if my Universal Life policy has a policy loan or has been assigned as collateral for a loan?
Unfortunately you do not qualify for our premium deferral exception process.
If I am paying my policy annually, am I eligible?
Yes, however, your policy will be switched to a monthly pre-authorized debit (PAD). If you are not currently paying by PAD, you will need to provide RBC with your banking information in order to qualify for premium deferral.
How can I apply for premium deferral?
You must complete the attached premium deferral form, indicating repayment plan, and email it to premiumdeferralrequest@rbc.com or to farjana@osainsurance.com or fax to 416-915-6150. Once the request has been processed RBC will email you a letter of confirmation that should be kept with your contract. This exception process is available until May 31, 2020.
Is the policy still inforce while the premium is deferred?
Yes
Can I request a deferral of my loan or interest payment if I have a loan?
Unfortunately, this exception is only available for premium deferrals. Loan and interest payments cannot be deferred at this time
Will the benefit amount be affected?
Benefit Payments will only be affected if there are premiums owing when the client or beneficiary submits a claim, at which time any outstanding premiums will be deducted from the amount of their benefit payment as follows:
- In the event a disability insurance claim is submitted during the 90 day deferral period or during the repayment period selected, the monthly disability benefit will be reduced by any unpaid premiums in accordance with the repayment schedule. Regular premiums that fall due after the date of disability will be waived in accordance with the applicable waiver of premium provision.
- For any life and critical illness insurance claims, the benefit amount payable will be reduced by any unpaid premiums.
What happens after 90 days?
RBC will debit your account according to the repayment plan selected on the Premium Deferral form. If we are unable to collect the premium owing, the policy will lapse and the contractual reinstatement provision will take effect.
Are there any exceptions to this process?
Not at this time.
How does premium deferral impact my contractual provisions?
Any contractual provision will continue to be honored. Expiry dates for contractual provisions, including but not limited to Term renewals, Term exchanges, Term conversions, Future Income Options etc. will not be extended.
3. HAVE YOUR INSURANCE NEEDS CHANGED?
Clients have been reflecting on what they have and their insurance needs and some have asked how they can increase their insurance. Due to COVID-19, RBC Insurance has reduced medical requirements as listed below:
Life insurance – apply for new insurance with no medical required (no blood, urine or vitals)
– Up to age 50 can apply for $1,000,000
– Age 51-55 can apply for up to $499,999
– Age 56-60 can apply for $300,000
– Age 61-70 can apply for up to $99,000
– Rapid underwriting
Critical illness insurance – no medical required (blood, urine, vitals).
– Up to age 40 can apply for $250,000 – no fluids required
– Age 41-50 can apply for $100,000.
– Age 51-55 can apply for $50,000
– Discount – 10% discount
Disability insurance – no medical required (blood, urine, vitals).
– Up to age 50 can apply for up to $8,000/month.
– Age 51+ can apply for up to $2,500/month
– Discount – 25% discount
ACTION: Apply here
4. GOVERNMENT FINANCIAL ASSISTANCE
Various government assistance plans have been put in place such as
- Canada Emergency Wage Subsidy – to help employers (your medicine professional corporation) keep employees (office staff for example) employed
- Temporary Wage Subsidy – to help employers reduce payroll tax
- Canada Emergency Business Account – An interest free loan $40,000 for business owners (i.e. your medicine professional corporation)
- For complete information on these various government assistance plans click here.