20 Jun Ensure your lifestyle is fully insured
Even if you don’t consider yourself someone who leads a risky lifestyle, there’s a chance that experts might disagree.
If you rock climb, scuba dive, travel to dangerous places for work or even drive long distances (compared to the average person), you’re considered a higher-risk individual.
And with this lifestyle comes a unique set of risk management and insurance needs. Here are some tips to figure out what coverage you should consider.
Understand and manage risk
Forget extreme sports — if one of the below is your profession, you may need high-risk insurance:
- political figure;
- business mogul;
- professional athlete;
- hazardous chemical workers;
- deep-sea diver; or
- firefighter, military or police force member.
These jobs often include exotic, international travel or more frequent access to risky activities.
The greatest hazard is an accident, and you don’t want to find out your policy won’t cover you after such an event. If a specific extreme activity is not named in a policy, it’s not covered. Rock climbing, for example, may be excluded from a standard policy.
You can purchase a rider to cover such an activity, which is an add-on to your regular coverage at additional cost. The rider will specifically name the activity and any additional guidelines. The extra cost typically ranges from a 25% to 600% surcharge.
Individual life insurance offers you two options for participating in activities like rock climbing. Your policy can be rated from $2.50 extra per thousand, to $10.00 extra per thousand, to an outright decline to be issued with an exclusion (no coverage) for this activity.
One unusual risk is being kidnapped. Politicians, for instance, have to be prepared. If you live with this type of risk, consider specialty kidnap and ransom insurance, which provides a safety net and allows for any such situation to be resolved with help from a specialized company.
Know your policy
The biggest mistakes you can make is not reading your policy, misunderstanding what is covered, or simply assuming you’re fully covered. Walk through the policy with an expert, looking for any important stipulations.
Many high-risk activity companies require you to sign a waiver before participating, but that waiver only protects the business and won’t affect your insurance policy and coverage.
Amateur thrillseeker or a highly skilled participant?
When it comes to assessing your preparedness for risky activities, travel underwriters won’t look at your safety equipment. In addition to regulation and training, a key determination is whether you’re an amateur thrillseeker or a highly skilled participant. This is developed during the underwriting process, with activity-specific questionnaires, medical reports, motor vehicle reports, and outside consumer reports, including Google searches. If you’re designated as a professional athlete, or involved in an association related to a risky activity, you may not be insurable.
Cross-reference an employers’ coverage
Make sure you’re aware of what your employers’ insurance covers. Most group insurance plans have some out-of-province coverage, but it could be basic and will likely have restrictions around higher-risk activities. If you’re travelling outside the province or leaving Canada entirely, make sure you’re covered.
Disability insurance may also be a good addition due to the physical risk involved with some activities. This typically requires extensive documentation and interviews, and may specifically exclude risky activities, such as heli-skiing or skydiving.
Similarly, if you travel to areas where health advisories are in place, be aware that many travel policies could exclude coverage.
Ultimately, the best thing you can do is read and understand your insurance — know when you’re covered, and when you’re not.
To read this article by Advisor to Client online, CLICK HERE. If you have questions be sure to contact Harry Perler or David Olejnik.