Why, Oh Why, Do I Need CI?

Why, Oh Why, Do I Need CI?

Side note: The picture above has nothing to do with the article below but I’ve come to realize that any pictures relating to ‘financial planning’ are so boring and redundant… maybe I’m just not creative enough. So, I’ve decided to post pictures of photos I’ve taken and places I’ve been. Want to learn more about the photo above? Read the article and find out at the bottom! I mean you could scroll right to the bottom but… come on…


Hilarious, I’m a modern day poet you know.

You’re probably wondering, “What is CI?” 

CI = Critical Illness Insurance.

Me? Write about insurance?! Who would have thought…

Here’s a thought…

Of the following risks, which would make a big difference in your life?

1)     Your car gets stolen

2)     Your house gets broken into

3)     You lose your favourite jewelry item

4)     You’re diagnosed with cancer

Then why is it most people are insured for the first 3 but not the last, cancer.

Perhaps out of fear, being scared to have the conversation.

Perhaps out of denial that it couldn’t happen to them.

Perhaps they didn’t know you could insure against cancer.

Let me say this one more time…

You insure your jewelry, you insure your car, you buy warranty on your electronics… but for some reason you don’t insure one of your most important assets, your retirement savings. 

What does your retirement savings have to do with cancer? I’ll get back to this in a second.

What is CI? Critical illness insurance pays you a lump sum tax-free amount of money 30 days after being diagnosed with a covered critical illness. The big three are cancer, heart attack and stroke. 

“But why would I get CI when I have OHIP?” Great question…

1)     OHIP doesn’t cover all medical expenses 

2)     The money can be used as an income supplement if you’re off work trying to get better. It can also be used as an income supplement for your partner if he/she is taking care of you 

3)     The money can be used to pay down debts 

4)     Some people will use the money for a vacation after going through the stresses of battling a sickness

5)     Miscellaneous expenses are a big one: flying loved ones in to help take care of you, parking costs at the hospital, etc. 

“What did you mean by protecting my retirement savings?” 

From the time you start working to the day you retire you save money, save, save, save. The goal? To the have the retirement of your dreams – lying on a beach, sipping that margarita, listening to Carly Rae Jep… never mind.. you get my point.  

Unfortunately, life doesn’t happen in a straight line.

You’re diagnosed with a critical illness and you’re off work indefinitely. Where are you getting money from? That’s right, your retirement fund.

You’re now withdrawing money from your retirement savings and compound interest is saying, ‘please stop, you’re killing me!’

*** The less money in your savings account, the slower it grows. ***

Here’s an example:

You start saving $450 / month in your TFSA at the age of 25. Assuming a rate of return of 5%, you would have $686,000 at age 65.

… $686,000! Compound interest… the 8th wonder of the world… ever heard of it?! Powerful stuff

What if at age 47 you get sick and you need to withdraw $200,000 from your TFSA? Assuming you could continue to save $450 / month (unlikely) you’d have $195,000 at 65.

Withdrawing $200,000 at 47 cost you $400,000 of retirement money at 65!

Why not insure your retirement account with a CI policy and let the insurance company pay you the $200,000 you need?

The best part is that these policies can be set up in such a way so you can get your money back if you don’t get diagnosed with an illness… wait, what?!

Yup, you can think of it as a forced savings plan. You get diagnosed, you receive a tax-free benefit. You don’t get diagnosed, you get your money back.

The priority when you get sick is to get better – not to worry about finances.

Everyone knows someone who has suffered or who is suffering from a critical illness. Maybe it’s time to have a, potentially, difficult conversation about what it really looked/looks like for them, not only emotionally but also financially.


The above picture was taken while I was on my Honeymoon last month in Asciano, Italy – part of the Tuscany region. My mom actually saw this picture online and when I showed it to my wife we both agreed we had to check out this scenic location. Let me tell you, I’m glad we did. We drove from Northern Tuscany, where we stayed, down to Asciano, stopping at various wineries on the way. By far some of the best driving I have experienced. Staying off the highway and driving through the countryside provided breathtaking landscapes and winding roads.

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