Product Information

When you are designing your Long Term Care Insurance plan, you should give consideration to the following points.

The Future Cost of Care
Be sure to investigate how much healthcare costs today, but keep in mind this figure will increase due to inflation, an aging population (more baby boomers means greater utilization of the healthcare system), and advances in technology/medicine. There is no guarantee that the government will finance future programs to the same extent they do today. Build in a safety margin when choosing the amount of coverage you buy. You can also look at Cost of Living Options that will increase your coverage automatically.

How Soon Your Benefits Should Begin

Your policy will contain an elimination period that works similar to a deductible. It is the period of time following your loss of ADLs that must pass before benefits begin to be paid. Typical options include 30-days, 60-days, 90-days, and 120-days. Choosing the shortest can drive up the cost of your plan, but waiting too long can put financial strain on you and your family when the time comes to claim.

How Long Should Your Plan Continue to Provide Benefits

While everyone would like their plan to pay for the rest of their life, not everyone can afford to buy a plan which pays lifetime benefits. Examine other alternatives such as 5-year plans, and 2-year plans. Be cautious about using statistical averages to determine what length of benefit period you should buy. Not everyone falls within the 'average claim', and you could end up short on dollars.

Balance is the key when choosing the amount, the elimination period, and the benefit period for your plan; your advisor can helpl you select what is right for you.

There are three different types of policy structures:

Reimbursement Plans
With this type of coverage you first pay the expense, then submit a claim form for reimbursement . Some but not all Homecare policies work this way.

Indemnity Plans
With this type of coverage you purchase a specific daily or weekly amount. Once your claim is verified, the insurer pays you this specified amount regardless of whether your actual expenses are higher or lower.

Both Reimbursement and Indemnity Plans stipulate where you can be receiving care, and who can provide the care to you. They generally will not pay benefits if your care is provided through an informal caregiver such as your spouse.

Income Plans
This type of coverage works similar to disability insurance coverage. Once your claim is approved, you continue to receive a monthly benefit for as long as you continue to need assistance. This type of coverage allows you to receive your care from anyone you choose, even an informal caregiver. You receive your benefits regardless of where your care is being provided. Because it is more flexible than either a Reimbursement or Indemnity Plan, it usually costs a little more.

Your Long Term Care Insurance may be in force for many years before you need to use it. You want to be sure that it does not lapse simply because you forgot to pay the premium. Insurers offer various aids to help minimize this risk. Be sure to ask what measures are available to you. Some companies allow you to list a third party's name to be notified if a premium remains unpaid. For instance, you may appoint your son or daughter as a third party to notify. Some companies offer Nonforfeiture Provisions. If the premium remains unpaid after many years of paying premiums, the policy may either change to a paid-up policy for a reduced amount, or continue in the same amount for a period of time ("Extended Term Insurance") after which it will expire.

While not all insurers offer Long Term Care Insurance, we can help you select the company and the plan design that will best meet your neets. We work with the following insurers:

Blue Cross
Desjardins
Manulife
RBC Insurance