INSURANCE HOME LIFE INSURANCE LIVING BENEFITS Critical Illness Disability Long Term Care Health & Dental Travel Medical BUY INSURANCE ONLINE TOOLBOX ASSOCIATIONS & ALUMNI CONTACT US	Why can’t I just use my RRSPs or other savings to cover any costs? The quick answer is you can. Research conducted by Manulife revealed that one-third of the respondents believe that in the event of a critical illness they would finance recovery costs not covered by their provincial health care or employee plan by withdrawing money from their savings accounts. Many others said they would borrow money from a bank, borrow from family or friends, sell property, or use their RRSPs. But before you do that, take a look at the following example. It shows the effect a critical illness can have on your retirement savings. John, age 45, is diagnosed with a critical illness. He has long-term disability insurance that replaces his income. Does he need critical illness insurance as well? Because of his illness, John needs to hire someone to look after him, make some home and vehicle modifications and purchase a wheelchair – he needs about an extra $25,000. His only source for that money is his RRSP. He’s in a middle tax bracket, so he needs to take out $45,000 from his RRSP, and there’s tax payable on withdrawals from an RRSP. He had expected his RRSP to grow at 5% per year until retirement, so he’s lost $112,111 of his retirement income or almost $9,000 a year if he plans for 20 years of retirement beginning at age 65. If John had Lifecheque, his annual premium for level Lifecheque coverage would provide a $100,000 benefit – more than enough to cover any unexpected expenses. John can put the extra $75,000* into his retirement plan, which would mean an extra $230,000 or $18,485 extra each year for 20 years. Lifecheque would allow John to focus on his recovery and would help provide him with the peace of mind that the financial plan he’s worked so hard to develop won’t disappear. *The calculations in this example assume that the critical illness benefit is tax-free. The Canada Customs and Revenue Agency (CRA) have not yet confirmed actual tax treatment of these benefits. Tax laws are subject to change and, therefore, tax treatment of presented figures cannot be guaranteed. Wonder how much Lifecheque coverage would fit your needs? Try the Critical Illness Calculator. Lifecheque. Because recovery will be your first priority. What’s the chance I’ll ever need Lifecheque? What conditions does Lifecheque cover? What plans are available? What else is available through Lifecheque? What should I do with the money? What if I die or the policy expires and I never needed Lifecheque? Where can I get more information? Making a critical illness claim (PDF)