SPEAKER_03 0:00

One out of two Canadians. That's a statistic. One out of two Canadians are going to be diagnosed with cancer.

SPEAKER_01 0:06

That's right.

SPEAKER_03 0:06

That's huge. It's two of us. Right? One out of two? Yeah, I don't even want to think about them. But that's those are the odds right now. The odds are stacked against us, against our system, against what we're building here. Hello everyone and welcome back to another episode of the Sovereign Capitals Podcast. I'm your host, Hussein Camcho, along with George Roth, here with me again. This time we have a very special episode. We are at the office of Assurance Capital Advisors doing this podcast live of this setting. Together in the same place. So it's gonna be an interesting conversation. We don't have our usual microphones, but I hope this should be good enough for you guys. Today we're gonna be talking about critical illness and disability insurance and the role they have in capital formation. Okay? So I know some advisors that promote an infinite banking concept, they sometimes they don't even talk about that. They completely disregard the fact that those two, critical illness and disability, they have a very, very critical part in capital formation and protection and strategy, right? So we're gonna be discussing that today. Most people think that they're building wealth, they look at their brokerage accounts, their real estate, or even the infinite banking policies, and they see a fortress. I agree with that. But here's the truth: your entire financial empire is currently resting on a single fragile point of failure. Think about it. If you own a business or a cash-flowing asset, you insure it, right? If you have that, you make sure it's fully insured. You make sure you protect the golden goose. But when it comes to the human machine, quote unquote human machine, that's you listening, the very engine that generates the capital to fund your private bank, which is you, we have been conditioned to be lazy about it.

SPEAKER_01 2:02

So if a critical illness or disability hits, for traditional system doesn't pause its demands, right? The bank still wants the mortgage payment, the tax man still wants his cut, and if you aren't prepared, you'll be forced to do the unthinkable. Cannibalize your own bank. You'll be forced to liquidate your assets, regardless of what those assets are. Anytime we're forced to liquidate, it's a bad thing. And we will kill our compounding interest just to keep the lights on. So today we are reframing critical illness and disability insurance, which are very important. This isn't about fear, it's about defensive liquidity. It's about ensuring that even if the human machine breaks down, the sovereign bank keeps running.

SPEAKER_03 2:51

Excellent. So, George, let's talk about first the problem: the human capital risk. The traditional financial advisory and narrative is usually sees insurance as a cost, you know, as a just in case expense. To have it and not need it and to need it and not have it kind of thing. The real problem here is that the government, meaning CRA, and the banks, they rely on your cost and productivity to either service debt or pay the taxes. If your health fails, well, everything stops. So, what we're trying to do with this episode is to show you guys how you are the most important piece in this puzzle and your ability to generate an income, it's really what's key here and what we have to protect. Now, if you are already implementing the infinite banking concept and you're growing and building capital, you have understood the importance of building capital. You might be forced to access that capital early on before you intended to to cover for those expenses when the machine breaks. And that's us. What do you have to say about that, George?

SPEAKER_01 4:15

Why does it so the thing there is that if our health fails, so ultimately what we're getting at is you're no longer able to generate an income, right? Whether it's due to an illness, to an accident, doesn't matter. You are unable to work, you're unable to generate an income. So how are you going to pay your bills? How are you gonna pay for those expenses? Because they don't stop.

SPEAKER_03 4:36

They don't.

SPEAKER_01 4:38

The bank still wants their money, the government wants their money, utility companies want their money, everybody wants their money, no matter what. They don't necessarily care. I mean, maybe they're somewhat empathetic.

SPEAKER_03 4:48

Well, they all tell you they care, but maybe the people, not the corporation, the people working, but they have no power to do anything for you most of the time.

SPEAKER_01 4:57

The key is to protect yourself, right? Yeah, so we want to protect ourselves against the possibility of us not being able to generate an income for whatever reason. Yeah. So if we can't generate an income, we can't pay our bills, we can't capitalize our privatized banking system, what happens then?

SPEAKER_03 5:17

Hey, and I will say look, a lot of people will say, oh, well, that's why we have uh EI, employment insurance. All right, if you guys have checked about last time I checked like how much they will cover, I guess not enough.

SPEAKER_01 5:30

It's not enough.

SPEAKER_03 5:31

They haven't, I don't think they have even updated that for a while.

SPEAKER_01 5:36

It's based on your income, yeah, but it's only a percentage of what you are making before.

SPEAKER_03 5:41

And they have a maximum. So they have a capital. That is true.

SPEAKER_01 5:44

Yeah, and it only goes for a period of time. So the government safety nets are designed for subsistence at the maximum, not for the preservation of a sovereign business or a private banking system. They're not designed to give you what you actually need to progress and to continue with your plan. Whether it's WCB, EI, CPP, you know, it doesn't matter, right? Group plans. So group plans are not bad, but we have to understand that they have limits. They're often not going to give us what we need either. And there's waiting periods. There's only so much time that you're going to get paid, and it's only a percentage of what you're getting before. So again, it's not designed for you to flourish and to continue with your capitalization and your use of your system and the growth of your system while paying all your bills.

SPEAKER_03 6:40

None of it is designed for that. Right, and about group plans. Anyone that has a group plan, have you guys ever sat down with the advisor and make sure that you guys are fully covered to your needs? It's usually like a one-size-fits-all kind of thing. They have ranges and say option one, option two, option three, and that's what you choose, and that's it, right? But there's no like, okay, let's listen to you, what's important to you, what do you need to protect for, what will actually bring you peace of mind. Let's make sure you understand, for example, what is DI, what is the eye.

SPEAKER_00 7:12

Yes.

SPEAKER_03 7:12

Like a lot of people working and they even have some of those benefits. They don't even know what that means.

SPEAKER_01 7:18

I would say the first step is to find out what you actually have, what is your coverage, how does it impact you, and is it going to meet your needs? It's also important to understand the difference between critical illness and disability insurance. So critical illness insurance pays you a one-time lump sum tax-free benefit if you're diagnosed with one of the illnesses. There's 25 to 26 illnesses. Yeah. So if you're diagnosed, you'll get a lump sum payment. And you can do anything you want with that money. Now, disability insurance is designed to cover your income. So you're paid a monthly amount, which is a percentage of your income. It's never a hundred. It's anywhere from 60 to maybe 80% of your income, maybe. And it may or may not be taxable. So that depends on who's paying the premium. If you pay the premium, then it becomes tax-free. If your employer is paying the premium or part of the premium, then it becomes taxable. So that's also important to understand. And it's designed to cover your income for a period of time. It could be a year, two years. It depends, right?

SPEAKER_03 8:23

And even some DIs have the option to give you like also like a lump sum in case of a long-term disability. They also provide that. Some of them do, not all of them. It's always nice to check.

SPEAKER_01 8:34

So it's important to know what you have, and it's important to know the difference between critical illness and disability. And it's about protecting what's important.

SPEAKER_03 8:43

Let me also add something on DI before I forget. I often hear from people that, oh, I already have WCB, I don't need DI. Okay. And I tell them, well, WCB only covers you if you have an accident that leads to a disability while at work. If you're skiing or having fun, and then something happens, you are not covered. Very important to know that. But when we create like the DI policies that we create for our clients, you are fully covered for all that stuff. Even if it happens for us at work, you are covered 20%. Really nice. You know, you fall down the stairs, you were playing with your kids, and something happened, you are covered. Yeah, which is a big peace of mind.

unknown 9:28

Yeah.

SPEAKER_03 9:29

Now, Goreto, stuff about, let's double down on that machine. That machine of flesh and bones. If you are listening, if you own a machine that let's say you're making 100k or 200k, whatever you're making, let's say you have a machine that's capable of creating the same amount of money as your salary or or whatever you do in business on a yearly basis. Let's say you have a machine that's capable of doing that for you, printing that money for you. I think you're gonna make sure that you insure that machine. Like if we insure vehicles that are depreciated. Yes. We insure homes, and understand the home, but the home can burn down and we understand that risk. There's people that even insure phones.

SPEAKER_01 10:12

You can insure almost anything these days. You can insure your pet, anything, you can insure almost anything. Yeah, jewelry, we name it. So if we want to insure ourselves against the loss of those things, not all of which are assets, because an asset has to grow in value, not depreciate in value, but we insure them anyway. Why would we not insure the machine that creates everything?

SPEAKER_03 10:38

And how would you operate in life knowing that that machine is fully covered? Yeah. It even changes your mindset the way you operate. Absolutely. Yeah, absolutely. Well, talking about also that machine, when that machine breaks down, it uncovers the hidden partners of that machine. Because those partners are gonna come knocking. They're gonna come knocking and saying, Well, I understand the machine is broken, but we need our cut, right? Try to call the bank and tell them that you need a break from your mortgage. You could possibly get a month of a break, maybe two. I'm stretching that, but I don't think you can get more than that of a pay holiday. Exactly. So just imagine that, you know, and that's what it also tell the clients when we talk about this is that let's make sure that your critical illness coverage, let's make sure that we cover at least mortgage and groceries per year. Yeah, to add a peace of mind that you know that that stuff is covered, that might be even the difference between you fully recovering from that illness or not. Because if you're dealing with high impact illness and you also have to deal with the stress in your mind, like it's really, really tough to get over that.

SPEAKER_01 11:55

Absolutely. And I mean, what do we talk about here? Control, flexibility, freedom, liquidity, options. So if you have a lump sum of cash that's tax-free, you now have all of those things.

unknown 12:07

Yeah.

SPEAKER_01 12:08

You have control, you have flexibility, you have options.

SPEAKER_03 12:11

And you don't have to ask for government money.

SPEAKER_01 12:13

Exactly.

SPEAKER_03 12:14

Some of the people listening might be like they don't even want to touch government. They're proud of themselves, they're proud of what they built, they want to be fully self-sufficient, and they don't want anything to do with that. And this is exactly what we're discussing here.

SPEAKER_00 12:29

Yeah.

SPEAKER_03 12:30

So, George, how do we integrate this with IBC? Talking about critical illness disability, integrating that with IBC, you might say that this is like the guard of the door of the vault. And you see that analogy there.

SPEAKER_01 12:51

Yeah, it's like it's that protector, right? It's that protector at the door of the vault, guarding against your inability to pay your premium, to capitalize your system, to pay your bills, to continue to grow and protect your wealth and your capital.

SPEAKER_03 13:08

Well, and the goals that you have set is guarding all of those goals.

SPEAKER_01 13:12

And some people will say, I I um I'm self-insured. I can self-insure. I have money. I have money here, I have money there, I have this here, I have that there. So if I lose my income, you know, I'm ill or I'm injured and I can't work. Well, I have something to fall back on. My savings, whatever it might be. Well, that's all well and good. But what is that now doing? Now that is derailing your plan. Your plan that you had before, what you wanted to achieve and how you want to achieve it and what has now been derailed because you now have to liquidate an asset, withdraw your savings, cannibalize your system just to maintain status. So what we want to do, and and the reason that we want to talk about this, is we want to protect our plan. Yeah, we want to protect our system. Yeah, you know, we've gone to all this trouble and effort and time to create a system and a plan. We know it's the right thing to do, so we want to protect it. Of course. We want to protect it against our machine breaking down.

SPEAKER_03 14:14

And it will break down.

SPEAKER_01 14:16

And it will, it's true. So, you know, one diagnosis, one phone call, one visit to the doctor, you know, can be life-changing. And I'm sure, I mean, everyone that I know, and probably most of our listeners, have been impacted in one way or another by a critical illness. Of course. Your families, like car's attack, yeah, stroke are the big three. Everyone's been impacted, so they know it's real, and the statistics are like one out of two Canadians.

SPEAKER_03 14:45

That's a statistic. One out of two Canadians are going to be diagnosed with cancer.

SPEAKER_01 14:49

That's right.

SPEAKER_03 14:50

That's huge. There's two of us, right? One out of two? Yeah, I don't even want to think about those. But that's those are the odds right now. That's the the odds are stacked against us, against our system, against what we're building here. So it's just a matter of protecting and being proactive.

SPEAKER_01 15:07

And you may not need that protection forever either. No, right? No. If you build your system adequately for a long enough period of time, potentially you could become self-insured if you choose. But in the meantime, you need that protection, that level of protection. So that's what we're talking about here is just protecting your plan, protecting the strategy that you've implemented that you've done all this work for, and spent all the time and effort in doing.

SPEAKER_03 15:47

You might choose different options when it comes to healing, you know?

SPEAKER_01 15:51

Absolutely. You can go somewhere to get the care that you want. Exactly. Or you have a choice.

SPEAKER_03 15:58

That's right.

SPEAKER_01 15:59

That's right.

SPEAKER_03 15:59

So going back to the group plan, how would you say that relying on R percent on a Group plan affects your ability to be fully sovereign in this system?

SPEAKER_01 16:11

Well, it just doesn't, right? Because it doesn't give you what you need. It's the thing with group plan. So group plans are designed to give you a subsistence, a bare minimum. And they're all like a one-size-fits-all.

SPEAKER_03 16:26

Will you go as far as to say that everyone under a group plan there's a high chance that they're protected? Absolutely. Yeah.

SPEAKER_01 16:33

Most group plans don't have critical illness included. That's true. Often they will have disability, some short-term and long-term disability. They'll have some health benefits, those kinds of things, but often they don't have critical illness. So you want to make sure that your plan has the coverage that you actually need.

SPEAKER_03 16:51

What about the disability and critical illness coverage from the banks that they offer you when you have a mortgage? Let's talk about that. Because I think a lot of people have some of those. I know one big bank that offers them. Yeah, I have to help a client that has one of those. And I showed him what are the commons of that. Yes. The one that really, really comes is the fact that those types of insurance are always underwritten after the claim and not before the claim. What can we say about that?

SPEAKER_01 17:24

Well, it's it's a huge risk. So often creditor protection plans, whether it's life, disability, creditor illness, creditor protection is underwritten at the time of claim. Meaning you've now gotten ill, you're disabled, someone has passed away, you go to the bank to make your claim. That is when they decide whether or not you actually qualify.

SPEAKER_03 17:47

I think that's right now that's the biggest liability.

SPEAKER_01 17:50

Yes. Without a doubt. Whereas most plans, and any plan that we would ever help somebody implement is you're underwritten at time of application. So when you're approved, you know you're approved. And it's a contract, and only you can break the contract. Big difference. Yes. Big difference. The other problem with these plans, the creditor protection plans, is that they only protect that debt.

unknown 18:19

Right.

SPEAKER_03 18:20

So the money goes to the creditor. You don't even see the money.

SPEAKER_01 18:23

Protecting the creditor, you're not protecting yourself. They didn't get the money.

SPEAKER_03 18:27

Wow.

SPEAKER_01 18:27

And they they so your debt is paid, which is not a terrible thing.

SPEAKER_03 18:31

Yeah, yeah, yeah. So we when we have creditor protection, we are paid to reduce the risk.

SPEAKER_01 18:38

Absolutely.

SPEAKER_03 18:39

Is there anyone else that does that for us?

unknown 18:41

No.

SPEAKER_01 18:42

Why do you think they sell it? Why do you think that they want every single person that has a debt to get these? Of course. And the cost is usually very high.

SPEAKER_03 18:51

It doesn't go down as you pay.

SPEAKER_01 18:52

It does not. So as your debt goes down, the cost stays the same. It's not in your favor, that's for sure. Okay. So yeah, those plans, I would recommend you make sure you don't have them. And if you do, reach out because there are way better plans that you can get, and generally speaking, will be less costly as well. Absolutely. Because they just tack it onto your mortgage payment or your loan payment, and people often don't even realize that they're paying it. No, right? It's just part of their regular payments. You never think about it. You don't think about it. Yeah. But if you actually look and see what you've been paying for all this time, it can be a lot of money. You have it on credit cards, lines of credit, it's everywhere.

SPEAKER_00 19:36

Yes.

SPEAKER_03 19:36

Everywhere. And sometimes they just tick the box by default without even telling you. And now you realize that you have that stuff.

SPEAKER_01 19:44

So, you know, we talk about banks all the time, and how we don't want to do business with banks. So we get a bank loan, they take collateral and they take security. We pay them with interest. And if we have one of these policies, we pay for their protection. We are paying.

SPEAKER_03 19:59

Which is insane.

SPEAKER_01 20:00

Which is insane.

SPEAKER_03 20:01

It's insane. Nobody else is doing that for us. Why are we doing that for them? Yeah. Well, let's pivot to the auction view of this, what we're discussing here. When I say auction, for those that are listening and that haven't heard this term before, is the term about the auction school of economics, which is the school that we study and we follow and we promote. We believe it's essentially the school that holds the most sense when it comes to finances and the economics in general, right? Is it a school about some money, small government, private, free markets, free economy, the power of the individual, all that stuff, right? So how does protecting the income, our income, the income of this machine, aligns with the principle of protecting the means of production?

SPEAKER_01 20:55

Well, I think that's fairly self-explanatory, but we are the machine that generates the income. Our ability to earn an income is our greatest asset. It really is. And very few people think of it that way. So we are capital. And we have to protect the means of production. We are the means of production, regardless of what we do, to generate our income. If we're not there, it's not happening.

SPEAKER_03 21:18

And I would argue we have infinite means of production. Because it just depends on our growth. It depends on what we choose to do. And even in 2026, with all the information we have around, there's really no excuse to build an empire, for example. If you believe that, it's really up to you, I would say. I would argue that. So, George, can I like to recap what we have been discussing? If you were received a $200,000 cash-free check today, how would that change your time preference regarding your recovery?

SPEAKER_01 21:54

Yeah, I mean it makes all the difference. So think about this. I mean, picture yourself, you're diagnosed. With a critical illness. So it's potentially life threatening. You can't work. You need to recover. You need to get better. That needs to be your hundred percent focus. The last thing you want to worry about is how are you going to pay your bills? Absolutely. How am I going to capitalize my banking system? How am I going to maintain my plan? Keep my strategy moving forward. So this gives you that peace of mind. I don't have to worry about money. I can focus 100% on recovery. And we talk about ourselves, but what about our loved ones? So what happens if a loved one gets a diagnosis? It's the same. Are you going to be able to work? I don't think so. So you're not disabled, but you now need and want to focus on their recovery and taking care of them. Well, you want to have everyone protected.

SPEAKER_03 22:53

Those loved ones are the ones that feed that machine, that wealth-building machine, which is ourselves. In the case of fathers, for example, our children fuel us, they give us that energy we need, and that vision to move forward and keep going, keep going, keep going. And you're a father, you know what I'm talking about, right? And those listening know exactly what I'm talking about. If you see one of your little children fall ill with a life-changing disease, it would be really, really hard to keep going and keep doing the same stuff as you were doing before and keep your plans intact. So what a wonderful thing to have that coverage. It's a wonderful thing. It gives you the opportunity to even build some nice memories with your loved ones. Do the stuff that you have been delaying for years.

SPEAKER_00 23:48

Absolutely.

SPEAKER_03 23:49

It's just a law that's open. Just be a lot of opportunities and a lot of possibilities are open just because of that. To me, it's that's really valuable. And when I talk about this, I say to my clients, yes, we're building you the system to create and capture capital and have you ready access to capital and to expand your vision, everything that's related to that. And he who owns the goal makes the rules and all that stuff that comes with that. But I make sure that he fully understand also critical illness and disability, and I'll make you sign a waiver. If you don't want it, I'll make sure you sign the waiver because I don't want to be in that position when it listened from your wife. You know, why didn't you say anything? Why didn't you talk to him about it? Like it's our responsibility. We have a fiduciary duty to our clients, which is a huge thing. And I know there's a lot of advisors out there that don't care. We do care, we care about that. And I'll make sure you fully understand what are the implications of saying yes and the implications of saying no. It's really important to know that.

SPEAKER_01 24:56

Yeah, and it comes back to the options, right? The control, the options, the flexibility. You know, how are we going to deal with this illness now? How best can we deal with it? What if we're on a long waiting list? What if we can't get the treatment we need here? What if we need to travel abroad? What if we want to go on a nice holiday with our family?

SPEAKER_03 25:18

What if you don't trust the treatment? Like a lot of the listeners don't even trust the treatment that they're gonna receive. And they want to make sure that they are fully in control of that.

SPEAKER_01 25:29

So it takes that worry, that stressor away. You know, you're not gonna have the financial stress to go along with all the other stress that is now gonna come into your life.

SPEAKER_03 25:41

I'll give you the story of a friend. His friend is in the US right now. He has been in the US for almost 10 years now. Uh he has a family, uh, wife, and a child. Now the child is an adult. Now he was diagnosed with cancer. Okay. Thankfully, he has uh health coverage, which is what you needed in the US. Yeah. Thankfully he has that, but he hasn't been able to take a single day off for almost two years. He is working two jobs. Oh wow. And he was at one point he was working three jobs with the with cancer. With cancer, with cancer. Wow. He sometimes just taking a nap at the third job and just getting ready for the first. And that's the reality for a lot of people.

SPEAKER_01 26:33

Well, and the health coverage there is just the ability to actually get care, hospital care, right?

SPEAKER_03 26:40

Hospital care. That's all you're getting. It's not giving him the option to rest. Yeah, it is not giving him the option to find a different job because also the job is really demanding physically. So, like a really, really tough situation that could have been fixed by the stroke of a pen. And that's what we do here. We fix problems with the stroke of a pen. It's just that you know, it's our job to educate people, and those of you guys are listening, it's that's what we care about, is to make sure that you understand the options, what are the implications, and how you can protect yourself and your family in the best way possible.

SPEAKER_01 27:18

So, this episode has been all about the anti-fragile human capital plan. We believe in capital, as you know. We want to focus now on the human capital that's gonna make that whole thing work.

unknown 27:33

Yes.

SPEAKER_01 27:34

So we're moving beyond the virtues of insurance as a safety net. So often insurance is considered a safety net or a cost. Instead, we want to reframe critical illness and disability insurance as essential defensive infrastructure for a sovereign capitalist. We aren't just buying protection, we're securing the human capital that fuels our private banking system. So that's the key, that's the focus here. The human capital risk. What if our health fails? What are we gonna do then? How do we maintain, how do we grow, how do we continue?

SPEAKER_03 28:14

Maintain your independence. Exactly. Right? Exactly, and that of your family. I will also add this. I just had this idea, and I think it's wonderful to share it. Think of a soldier. Let's think about a soldier, and let's say this soldier implemented infinite banking. The rifle will be the IBC policy. That soldier goes to war with just a rifle. Now that soldier is missing the helmet and the body armor, the defensive parts. The helmet is your CI, your body armor is the disability, and now you're ready to go to war. But if you just go with just the IBC policy and start building capital there, yes, like that rifle is gonna be more powerful every day, and you have better chances at surviving the war, but you're gonna have an awful way more chances of surviving if you have a helmet and a body armor. Just say that.

SPEAKER_01 29:17

So critical illness is a liquidity infusion, so it's a lump sum that allows us to buy time and private care without touching our bank. Yes. DI, disability insurance, is the premium protector. It allows us to keep making those payments that we need to make. So it ensures that if we can't work, our system continues to be capitalized. So we have to look at our current fragility and move away from any employer-controlled benefits to owner-controlled infrastructure.

SPEAKER_03 29:55

And that's you, you owning and controlling it. That's right. You being in control, you being at the steering wheel. And that's where we want all of you to be at the steering wheel. That's right. We're just gonna be right beside with the map, telling you, hey, this is where you're gonna find. Go this and then turn right, you're gonna find this. This is us telling you where to go, what's gonna happen, but you're definitely at the steering wheel, you're managing where the ship goes. So it was a great conversation, George. Thank you everyone for listening. And I'll see you guys on the next one. Thanks everyone.

unknown 30:31

See you later.

SPEAKER_02 30:33

This episode of the Sovereign Capitalist Podcast was provided with the understanding that the staff and contributors of a service capital advisors are not here in engaged in rendering tax, legal, or financial advice. For such matters, please consult your own tax legal or financial advisor.