According to a June 2005 Ipsos-Reid survey commissioned by Sun Life Financial and its Clarica advisors, nine in ten Canadians (89 per cent) have had a friend or relative suffer a critical illness such as heart attack or cancer, yet almost half (49 per cent) have no plan to cover the high costs and loss of income associated with living through such an illness. Even among those aged 35 or older, the most vulnerable age group, 42 per cent of those surveyed said they have no financial plan in place.
Living benefits a tough sell for Canadian advisors
According to Advisor.ca’s 4th Annual Dollars & Sense Survey published in October, many advisors still find living benefits a tough sell, although seventy-six percent of insurance licensed advisors said they were recommending living benefits policies, making it the third most promoted product class after term life (at 94%) and universal life (at 79%). Why the selling challenge? According to industry professionals, advisors see the sale of living benefits products as more complex than other products; underwriting can be more difficult as well.
From my experience the main reason for the struggle is lack of advisor education – about the long term care health care system, the aging process and the realities of chronic illness. Advisors need to understand the emotional context around living benefits; they need to take a holistic approach to financial planning so their clients can see how critical illness and long term care insurance fit into the big picture – filling the gaps in coverage that most Canadians do not see or plan for.
For advisor education information: Advisor Seminars
The Sunday Toronto Star (October 30, 2005) featured an excellent article on long term care insurance by Ellen Roseman: The wisdom of long term care insurance.