Fracture Benefit
A fracture benefit is a lump-sum payment provided under certain accident or supplemental health insurance plans when you sustain a broken bone as a result of an accidental injury. This benefit is designed to help cover unexpected costs associated with recovery, such as lost income, medical equipment, transportation, or rehabilitation expenses.
How It Works
To claim, you are not required to prove your income or be unable to work, the way you would for disability coverage. All you need is a diagnosis of a fracture, typically acquired through an X-ray and confirmed by a licensed physician. Each insurer maintains a detailed schedule of payments that outlines how much is paid based on the type and severity of the fracture, so a small bone in a finger or toe qualifies for a lower payment while a major fracture of the leg, hip, or skull typically results in a higher benefit. The payout is tax-free and is made directly to you, and it does not depend on your actual medical costs or on whether those costs are covered elsewhere. You can add this coverage to disability income replacement benefits or purchase it on its own, and some Canadian plans are guaranteed issue, protect you 24/7 anywhere in the world, and can be used to place claims for multiple, separate incidents.
Example:
Suppose a Canadian buys a standalone fracture accident benefit and later slips on an icy sidewalk, breaking a wrist. After an X-ray and a physician's confirmation of the fracture, the insurer pays a tax-free lump sum directly to the person based on the fracture's place on the policy's payment schedule. The money is theirs to use however they choose, such as covering time off work or a brace, regardless of what their provincial health plan or extended health plan already covered.
What to Watch For:
Read the definitions and exclusions in your policy closely. Some plans define a covered fracture as a break in a bone or cartilage listed in the Schedule of Benefits, and the injury covered does not include any sickness, illness, disease, medical disorder, or medical treatments. Fracture benefits commonly contain exclusions, including fractures associated with or resulting from osteoporosis and fractures from participation in professional athletics or high-risk activities such as mountaineering, parachuting, or bungee jumping. Some plans also limit duplicate claims, paying only the first eligible claim, reducing any subsequent fracture of the same bone in the same place by 50%, and paying no more than one, the largest, fracture benefit for all injuries from the same accident.
