Facts on OMA Group Disability Insurance:
The current OMA group disability insurance offers up to $25,000 per month of group disability insurance through Sun Life. Unlike the current OMA group disability plan which terminates at age 70, the RBC Professional Series® Disability Insurance policy can be maintained to age 100. Should you need to make a claim, RBC offers a minimum inflation protector (not available with OMA Insurance), a recovery benefit (not available with OMA Insurance), 12-months protection in case of a reoccurring disability (not available with OMA Insurance) and a long-term care insurance conversion plan that can be paid off in as little as 10 years. In some cases, the RBC Insurance disability may be more expensive than the OMA, but RBC policy provisions and long-term care conversion option are more extensive and guaranteed.
With OMA disability insurance, rates can be age banded (<35, 35-44,45-54 and 55-69) which increase over time or on a level rate. Level rates are not guaranteed and may change overtime depending on the insurance costs of the group.
Below are the highlighted differences in policy provisions between an individual policy and the group OMA disability plan.
- Control – Under the OMA group disability plan, the insurer (Sun Life) controls your insurance. If you leave the OMA, you need to pay OMA fees to maintain your insurance. An individual plan you own and control.
- Definition of Disability-RESTRICTIONS
- Partial Disability – With the OMA there is no minimum payment if you are partially disabled. Individual coverage has a 50% minimum for 6 months.
- As of September, 2019, OMA changed their definition of partial disability to include a clause that references a minimum number of hours at work. “After the partial disability benefit has been paid for 24 months, then partial disability means the insured is under a physician’s care, not totally disabled and engaged in gainful occupation and unable to work 20 or more hours per week. Gainful employment means any occupation for which the insured is reasonably qualified by education, training or experience.”
Source: OMA disability contract 17849 revised Sept 2019 – Page 5
- Total disability definition has been updated and reverts to an any occupation definition of disability after 24 months. … “After the total disability benefit has been paid for 24 months, then total disability means the insured is under a physician’s care and due to sickness or injury is unable to perform any gainful occupation which the insured is or may be reasonable qualified by training or experience.”
Source: OMA disability contract 17849 revised Sept 2019 – Page 6
- Portability – If you leave Ontario, you need to pay OMA fees to keep your insurance. Individual coverage is portable.
- Recovery from disability. When you return to work after a total or residual disability, there is no recovery benefit from the OMA to help with a loss of income. An individual plan offers a minimum of 4 months based on the percentage income lost.
- Inflation protector – The OMA has no minimum inflation rider. Individual coverage offers a minimum 2%.
- Long term care conversion. At age 65, OMA disability insurance can be used for up to 36 months of home care, home renovation or a one‐time payment for a fracture. There is no additional premium required. A portion of total premiums are allocated each year towards Encore65 benefits. As a comparison, your RBC disability policy can covert to up to $6,000 per month of home and facility care coverage with lifetime benefits (to age 100).
- Discount/Rebate. The OMA offers an annual premium refund on the first $10,000 per month of coverage. In 2018, this refund was 0%. An individual plan offers a discount of up to 25% on up to $30,000 per month of coverage.
- Pre-existing condition amendment for insurance obtained without proof of good health has been updated to include an exclusion for any sickness or injury sustained before the coverage was inforce.… “no benefits are payable for any disability cause by injury sustained or sickness which first manifests itself before the coverage is inforce”
Source: OMA disability contract 17849 revised Sept 2019 – Page 12
- Can the OMA or its insurer change the insurance definitions or rates?
YES. A group insurance policy gives the insurer and/or the group the option to change rates and definitions at their discretion. In 2018, the OMA cancelled the rebate on their disability insurance and now they have made material changes to the definitions of disability. In 2019, the OMA changed the definition of total and partial disability as listed above.
How does this compare to an individual disability insurance policy?
Individual disability insurance plans do not have these limitations. With an individual insurance plan, you have locked in rates, policy provisions and guarantees on your definition of disability. Only you can change an individual insurance policy. If you get sick or injured, you don’t have to worry about your claim being paid. As doctors are now learning, the same level of guarantees and peace of mind cannot be said with group insurance.
Disclaimer: Levine Financial Group are independent insurance brokers. We are not part of the OMA and do not offer OMA Insurance.