What is long term care insurance (LTCI)? A very brief overview…

Long-term care insurance is relatively new in Canada and covers care where your clients wish to receive it – at home or in a care facility if absolutely necessary. LTCI used to be called nursing home insurance which it is not; statistics say 85 per cent of claims are paid to people at home.

As one financial advisor has said: It is “Stay at home as long as you can” insurance…”Do not be a burden to your children/family” insurance.

LTCI pays a monthly tax-free cash benefit which clients can use however they wish.


  • Allows individuals to stay in their own home as long as possible
  • Provides relief to family caregiver(s)
  • Permits care choices
  • Protects estate/assets

Policy Triggers

One qualifies for covered benefits when a physician states that:

  1. You are unable to perform at least two of the basic Activities of Daily Living (ADLs) such as dressing, bathing, eating, toileting, continence, transferring (getting in and out of a bed or chair), and mobility.
  2. When you need 24/7 help because you have a severe cognitive impairment such as Alzheimer’s disease or a related dementia

Why people buy long term care insurance

  • They do not want to rely on family for care
  • They want to preserve their lifestyle/standard of living
  • They want care choices and control
  • They do not want to suffer the way a spouse/parent suffered
  • They want to preserve assets for other needs
  • They want to keep family healthy and together
  • They want dignity, independence and control
  • They want peace of mind

LTCI can be customized to fit almost any budget. For more information on partnering with Karen Henderson to increase your LTCI sales, visit Work With Karen.

Reasons To Consider Long Term Care Insurance For Your Clients

1.   How will your clients fund long term care?

Three quarters of Canadians (74 per cent) admit they have no financial plan to pay for long-term care if they needed it, according to a poll released by the Canadian Life and Health Insurance Association (CLHIA) in June, 2012.

The CLHIA estimates that it will cost almost $1.2 trillion to provide long-term care to the baby boomer generation as they pass through old age, and that current government programs and funding will only cover about half of this. The resulting $590 billion funding shortfall is the equivalent of about 95 per cent all individual registered savings plans in Canada today.

Age is not a determining factor in needing long-term care. Statistics reveal that about 60 per cent of individuals over age 65 will require at least some type of long term care services during their lifetime. About 40 per cent of those receiving long-term care today are between 18 and 64.

Most worrisome is that the polling also shows that 55 per cent of us believe government health care programs cover half or more of the cost of their long-term care needs.

2.   So what do provincial governments actually cover?

Because long term care is not covered under the Canada Health Act, patients and their families have to pay a large share of its cost. Home and long term care depend on a co-payment system. That is, each province decides how much it will contribute to both types of care; the remainder or the gap must be paid for by the individual.

Contrary to popular belief, nothing in health care is free.

3.   Is there a dementia epidemic?

Alzheimer’s disease (AD)/related dementias are on the rise dramatically in Canada and around the world. Age is the number one risk factor; the disease is fatal and can last anywhere from a few to over 15 years, requiring enormous caregiver support.

According to the Alzheimer Society, Canada is facing a dementia epidemic:

  • Approximately 750,000 Canadians have dementia today – one new case every 5 minutes
  • By 2038 1,125,000 Canadians will have dementia – one new case every 2 minutes
  • Demand for long term care will increase 10-fold
  • There could still be a shortfall of nearly 160,000 beds equipped to deal with dementia sufferers

4.   What options are available to clients to pay for long term      care? 

  • Personal savings/investments
  • Pension plans
  • Help from family/friends
  • Reverse mortgage
  • Long term care insurance


Rising Tide: The Impact of Dementia on Canadian Society

Alzheimer Society Canada 2010