(NC) -- According to Desjardins Financial Security's last retirement survey, 17 per cent of self-employed Canadians are carrying debt loads of $50,000 and up. While this is substantially lower than the 83 per cent of respondents who self-identified as either employees or business owners carrying the same amount of debt, it's still a concern because the self-employed have more to lose. This is especially true if they ever became sick or disabled. For example, among those self-employed who participated in the survey, 64 per cent owned life insurance, 60 per cent contributed to an RRSP, but only 24 per cent owned disability insurance.

“People who start their own companies often think like an employee with a benefits package, where most of the risk is covered by the company. They don't tend to ask themselves 'If I wasn't able to work and earn an income, would I still be able to afford my mortgage and other loan payments?'" said Nathalie Tremblay, Health Products Manager, Individual Insurance, at Desjardins Financial Security. "Unfortunately, the answer is no as 50 per cent of bankruptcies and mortgage foreclosures are related to disability."

Loan insurance gives peace of mind

Tremblay suggests that the self-employed consider loan insurance coverage because it repays the individual's loans in case they were ever forced to stop working due to an accident or illness. There isn't a clause for pre-existing medical conditions, as is generally the case for this type of insurance. The benefit is non-taxable and covers loans like mortgages, line of credit, RRSP loans, renovation loan, personal loan, car/vehicle loan or long-term leasing, student loan, credit card, all other fixed-term loans with regular payments.

"This insurance is flexible because it takes into account that your loans may vary over time. This means that between the time you apply for the insurance and when a claim is submitted, as one debt commitment is repaid it may be replaced by others. For example, if you pay off your mortgage and you take out a long-term lease for a motor home or a renovation loan, at the time of the claim, your loans will be fully covered, up to your amount of insurance," said Tremblay. "The most important part about this type of insurance is that it allows you to concentrate on getting better instead of worrying about your obligations."

For more information about loan insurance designed for the self-employed, speak to your insurance provider. Or for more immediate answers, visit Desjardins Financial Security at www.desjardinslifeinsurance.com.