Manulife Financial Introduces Long Term Care Insurance With Unique Design And Benefits For Canadians And Their Partners
Waterloo, ON - Manulife Financial has introduced LivingCare long term care insurance, with a unique Shared Coverage option, to help Canadians meet their rising needs for elder care and protect their retirement savings.
"Canada's aging population, increased life expectancy and need for elder care all suggest Canadians should account for long term care costs when they're planning for retirement," explains Paul Smith, Vice President of Marketing and Product Development, Manulife Financial.
"LivingCare provides individuals and/or couples with the money required to help support quality care. Its unique Shared Coverage option for couples (married or common law) helps support quality care for one or both partners. This long term care insurance product provides a monthly income, whether the care is at the insured's home or within a care facility."
The person insured under the policy can use the monthly income as they choose to provide the services they need to remain at home. Services could include non-professional or professional in-home care services, home modifications or medical equipment. The monthly income amount doubles when facility-based care is necessary.
In developing LivingCare, Manulife Financial leveraged its strength as a global company and consulted with colleagues in its US operations, John Hancock, a company that has years of long term care insurance expertise and a leadership position in the US market. Manulife Financial also focused on a number of key concerns among Canadians in developing LivingCare.
"We commissioned a survey(1) that found Canadians are worried about long term care, not only for themselves, but also their partners," adds Smith. "Fifty-seven percent of Canadians between the ages of 35 to 75 reported they're worried that their partners or they will need long term care and they're concerned about their ability to pay for it. We developed LivingCare and, in particular, the unique Shared Coverage option for couples, in response to these concerns."
Smith further explained that the research revealed a number of long term care insurance issues that would motivate Canadians to purchase long term care insurance. Topping the list were: not being a burden to family (82 percent); the option to choose where to receive care (80 per cent); and control over care decisions (76 percent).
Only 21 per cent of Canadians factored long term care costs into
retirement planning
Despite concerns about their ability to pay for future care, only 21 per cent of survey respondents said they accounted for long term care when estimating funds needed for retirement.
"It's not surprising to find that so few Canadians have factored long term care costs into retirement planning," comments Mark Halpern, CFP, founder of illnessPROTECTION.com and an independent financial advisor. "In my experience, most people spend less than five minutes per year thinking about their financial situation and how they will weather their retirement if something goes wrong, like getting sick or outliving their savings."
As Manulife's survey shows, Canadians are counting on a variety of sources to pay for long term care:
- How will Canadians pay for long term care if they Canadians need it? age 35 – 75
- Use savings or retirement income 80%
- Rely on government programs 61%
- Use the equity from their home to cover costs 53%
- Rely on financial assistance from family 22%
According to Smith, purchasing LivingCare is a good strategy for planning for retirement, particularly when you consider Statistics Canada's projections. By 2021, there will be nearly seven million seniors for health care systems to support, representing 19 per cent of Canada's total population.
Halpern agrees. "We can't rely on government to take care of us in old age. We are living longer, have fewer, more mobile children to rely on, so we need to think about how we're going to enjoy a good quality of life," says Halpern.
"If someone is forced to pay for long term care out of their after-tax savings, there could be considerable loss to estate value, and funds may be completely depleted. A long term care facility costing $4,000 per month over 10 years adds up to nearly $500,000. When care needs for an elderly couple are considered, asset depletion can become even more rapid."
"LivingCare offers Canadians peace of mind when it comes to their potential long term care needs. Not only can they be more secure that their retirement savings will be preserved, they can rest assured that they have a plan in place to gain greater control over care decisions without burdening family or friends," says Smith. (1) Manulife Financial Survey 2007 Manulife Financial commissioned Market Probe Canada to conduct a research survey among a random national sample of 1,008 Canadians. All respondents were between ages 35 and 75 with annual household incomes of $50,000 or more. Interviews were conducted between May 4 and 27, 2007. Results' margin of error: +/- 3.1 percentage points, 19 times out of 20.
SOURCE: Manulife Financial