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Updated disability insurance with more competitive rates

On Nov. 25, we’re updating Canada LifeTM disability insurance to become more competitively priced. We’re focused on the long-term sustainability of our non-cancellable disability insurance. With significant price cuts to most of our base plans and a redesigned, lower-cost return-of-premium rider (ROP50), many clients now have access to more affordable disability coverage. 

On Nov. 25, 2024, Canada Life Illustrations will automatically update to reflect these new rates and product updates.​​ 

We continue to be the only carrier offering a return-of-premium rider for clients in need of disability insurance coverage. Our re-designed, lower cost, ROP rider offers up to 50% of eligible premiums back every eight years. With the ROP rider cost reduced over 23%, and with a benefit payout every eight years, it’s now more cost effective to add the rider to the already-reduced base plan.   

The new lower-cost rider means that if a claim isn’t made, clients receive greater value for the additional cost of the rider (compared to investing the same amount.) The ROP50 rider is not available with the wage loss replacement plan. 

With significant price cuts to many base plan rates, combined with a reduced cost for the return-of-premium rider ROP50, we now offer clients more affordable coverage for some occupation classes and age groups.

  • Rates have been reduced by 9% on average with more significant reductions for occupation classes 4A, 3A and B and ages 45+.
  • There are some price increases for base plans 
  • The ROP50 rider cost has been reduced from 65% of base plan to 50% with benefit payout every eight years.

Future insurability option (FIO) elections on or after Nov. 25, 2024, are eligible for the new return-of-premium (50%) rider with an eight-year payout schedule. See the transition rules below for full details.

We simplified our product offering by discontinuing select base plans and riders that have been less popular with advisors and clients. When designing our updated disability insurance product, we wanted to ensure it’s easier than ever to select the right disability plan for your client’s needs. Our plans remain highly customizable to suit the various needs of your clients. 

We remain committed to the long-term sustainability of our non-cancellable disability insurance product.

The following base plans and riders are no longer available:

  • Independence plan
  • Key person plan
  • Catch-up rider
  • Lifetime accident and graded sickness (LAGS) rider
  • First day accident rider

These occupations have had more claims in recent years, and we want to ensure our product accurately reflects the risk categories to be fair to all customers. 

Occupation classifications have been modified for: 

  • Dentist generalists from 3A to 2A (dentist specialists are still 4A)
  • Large animal veterinarians from 3A to 2A
  • Small animal veterinarians from 4A to 3A

Issue limits for downgraded occupation classes have not lowered.

As of Nov. 25, 2024, we’ve changed the grad program discounts for physicians, dentist generalists and veterinarians: 

  • Grad discounts for physicians and medical students are reduced to 20%.
  • Grad discounts for dentist generalists, small and large animal vets are increased to 15%.

We’ve modified this definition to avoid situations that could result in the client being over-insured. It’s important to ensure the definition accurately reflects its purpose and fairly represents our customer needs while maintaining our competitive advantage. 

How is compensation changing for disability insurance?

We’re committed to strengthening our non-cancellable plan offering in the long run. With this in mind, the commission schedule for all new non-cancellable disability insurance sales has now been modified to be in line with the market.

This change was a key factor that allowed us to significantly reduce rates. Renewal compensation will now be 2% for the second year onward.

If:

Then:

Web applications received before 11:59 p.m. CST on Nov. 24, 2024

or

Paper applications received at head office on or before Nov. 22, 2024 1

  • Applications will be issued as applied for – with previous rates/contract pages, previous occupation class, previous grad discounts. Discontinued plans and riders are available.
  • Advisors may request new rates/contract pages, new occupation class and new grad discounts. Discontinued plans and riders are not available. 

Advisors must submit a new illustration prepared Nov. 25, 2024, or later. 

Web applications received on or after Nov. 25, 2024 (after 11:59 p.m. CST on Nov. 24, 2024)

or

Paper applications received at head office on or after Nov. 25, 2024

New rates/contract pages, new occupation class, new grad discounts apply. Discontinued plans and riders are not available.

Backdating to save age

Regular backdating rules will apply.
Applicable provincial legislative replacement requirements (for example, Basic Disclosure Statement) as well as the Authorization to transfer funds or replace existing insurance (form 17-8913) will be required.

If:

Then:

An application is in pending status on Nov. 25, 2024
  • Applications will be issued as applied for or may request changes to the original application – previous rates/contract pages, previous occupation class, previous grad discounts. Discontinued plans and riders are available. 

Advisors must request an illustration with previous rates from their new business associate or new business coordinator.

  • Advisors may request new rates/contract pages, new occupation class and new grad discounts. Discontinued plans and riders are not available. 

Advisors must submit a new illustration prepared Nov. 25, 2024, or later. 

For reissue requests received Nov. 25, 2024, or later. 

If:

Then:

A policy has been issued but not placed in force yet
  • Advisors may request new rates/contract pages, new occupation class and new grad discounts. Discontinued plans and riders are not available. The change will be handled as a reissue.

Advisors must submit a new illustration prepared Nov. 25, 2024, or later. 

The policy will have the current date, unless backdating to save age. 

  • May request changes to the original contract issued. To keep previous rates/contract pages, previous occupation class, previous grad discounts, and discontinued plans and riders, the policy must retain original issue date.  

Advisors must request an illustration with previous rates from their new business associate or new business coordinator.

A policy is in force with previous rates

May request new rates/contract pages, new occupation class and new grad discounts. Discontinued plans and riders are not available. The change will be handled as a policy replacement. 1

Advisor must submit a new illustration prepared Nov. 25, 2024, or later.

The new policy will have the current date, unless backdating to save age.
Applicable provincial legislative replacement requirements (for example, Basic Disclosure Statement) as well as the Authorization to transfer funds or replace existing insurance (form 17-8913) will be required.

For reissue requests received Nov. 25, 2024, or later. 

If:

Then:

A policy has been issued but not placed in force yet

Advisors may request changes to the original contract issued. To keep previous rates/contract pages, previous occupation class, previous grad discounts, and discontinued plans and riders, the policy must retain original issue date.

Advisor must request an illustration with previous rates from their new business associate or new business coordinator

A policy is in force with previous rates

May request a policy change.

If:

Then:

A request to re-open is received on Nov. 25, 2024, or later  
 
and

Policy is postponed/declined/not proceeded with (NPW)/not taken

  • New rates/contract pages, new occupation class and new grad discounts apply. Discontinued plans and riders are not available.

Advisors must submit a new illustration prepared Nov. 25, 2024, or later. 

  • The policy will have the current date, unless backdating to save age. 

If:

Then:

A request to re-open is received on Nov. 25, 2024, or later  
 
and

Policy is postponed/declined/NPW/not taken

Not available as plan is no longer offered.

If:

Then:

Anniversary date is before Nov. 25, 2024

Future insurability option (FIO) election is opted with rates that were in effect on the option date (previous rates, ROP7 rider). Rates may have been provided in the option letter.

Anniversary date from Nov. 25, 2024, to Jan. 24, 2025

Rates that were in effect when the FIO letter was sent out (previous rates, ROP7 rider). Rates may have been provided in the option letter.

May request new rates, ROP8 rider. 

FIO elections with guaranteed contract riders: Catch-up and FDA available if on base plan. 1

Anniversary date on or after Jan. 24, 2025

Rates that were in effect on the option date (new rates, ROP8 rider). Rates may have been provided in the option letter.

FIO elections with guaranteed contract riders: Catch-up and FDA available if on base plan. 2

Applicable provincial legislative replacement requirements (for example, Basic Disclosure Statement) as well as the Authorization to transfer funds or replace existing insurance (form 17-8913) will be required. Guaranteed contract riders: LPP November. 2005, May 2007, November. 2015, June 2019 assuming no reprice of April 2004 rates. Non-guaranteed contract riders: LPP pre-April 2004)

If:

Then:

Policy change application or letter of direction received at head office on or before Nov. 24, 2024

Previous rates apply. Discontinued riders are available.

Policy change application or letter of direction received at head office on or after Nov. 25, 2024

New rates apply. Discontinued riders are not available. 3  
Quotes on or before Nov. 24, 2024, may be honoured for 30 days from the date the quote was produced. Previous rates apply. Discontinued riders are available.

If:

Then:

Policy change application or letter of direction received at head office on or before Nov. 24, 2024

 Previous rates apply. Discontinued riders are available. 4

Policy change application or letter of direction received at head office on or after Nov. 25, 2024

Riders are not available.
Quotes on or before Nov. 24, 2024, may be honoured for 30 days from the date the quote was produced. Previous rates apply. Discontinued riders are available.

Canada Life and design are trademarks of The Canada Life Assurance Company.