What Long-Term Care Insurance Options do Canadians Have in 2021?

Why there is a need in long-term care insurance

After age 65 there is a 74% chance of needing long-term care in the future. It’s not just seniors worrying about this; more than 40 per cent of Canadians worry about how to provide, and afford, care for their parents as they age. Seniors are worried too. They don’t want to feel like a burden on their families. It’s a justifiable worry as Canadians can spend more than $4,000/month out of pocket for government subsidized care, and between $2,500 – $7,000/month for a private facility. There is the option of home care, but it also comes at a cost. Nursing, physical therapy, help around the house, meal services – these all add up.

While the federal government and Canada’s healthcare system address aspects of this care, too many seniors have needs that fall outside of the public system. Wait times, eligibility, and availability of rooms for long-term care are ongoing issues – and so are the costs.

Long-term care insurance is the way to ensure now that you have the support you’ll need later. The benefit can provide access to private care or in-home care along with solutions that may better fit your needs. Additionally, the benefit of long-term care insurance greatly reduces the financial strain on the senior and/or their family.

What is long-term care insurance?

Long-term care insurance covers basic costs when you are not able to perform two or more of the acts of daily living, which are defined as: bathing, dressing, eating, transferring, toileting, ambulating, and being mentally cognizant.

How does long-term care insurance work?

Once an assessment is done to confirm you are unable to perform two or more of the acts of daily living, and the elimination (waiting) period has passed, the benefit becomes available. Ensure you know the details of your policy as long-term care can be provided directly to the care provider or facility. Some policies can be structured to accommodate inflation. Work with a broker to ensure your long-term care policy is structured in the way that best suits your future needs.

Who offers LTC Insurance in Canada today?

In the past, a number of Canadian life insurers offered long-term care insurance. Meanwhile, there are only a few offerings on the market available to Canadians as dedicated LTC plans, and a few insurers have long-term care coverage as a conversion option on their other policies e.g. disability insurance and critical illness insurance.

A conversion is when the existing policy is converted to perform a different role. For example, after a period of time and under certain conditions, a disability insurance policy holder can convert the policy to long-term care insurance, if he or she has a rider on the policy that allows for this and all the applicable conditions have been met.

Please find out more from the overview we put together for you – it lists the Canadian insurers who offered long-term care insurance in the past.

CompanyOffered as a LTC policyOffered as a conversion optionCoverageWho qualifies
Yes (facility care and home care) $500 – $10,000 monthly for Facility and home careAge: 16-80 (must be approved)
Yes (home care only) $150,000 (ON, QC) $100,000 (other)All provinces:
18-80
 Yes  
RBC-Insurance Yes  
 Yes  

LTC Insurance plan in detail: Blue Cross

Blue Cross’ “Tangible” product in Ontario pays a monthly benefit for facility care should you become physically dependent. It also pays for home care services should you become physically dependent. It covers hospitalization and loss of autonomy in your province of residence.

It is important to understand the amounts insured for various categories:

  • Facility care/home care: $500 to $10,000 monthly
  • Hospitalization overall lifetime amounts: $10,000, $25,000, $50,000 or $100,000

As an example, a long-term care policy from Blue Cross for a 51 year old male non-smoker would cost $642.34 monthly (or $7,136.89 annually). This policy includes:

  • Long-term care coverage of $5,000 monthly
  • Home care coverage of $5,000 monthly
  • Premium refund upon death
  • 3% cost-of-living increase

LTC Insurance plan in detail: MyDignity

The My Dignity program was initiated around 2009. The impetus was the ensuing long-term care crisis facing Canada and the issues associated with traditional insurance products.

It is important to note that this plan is for home care only and does not cover LTC facilities.

My Dignity offers various coverages depending on province:

  • Ontario: maximum of $150,000 (ages 18-80)
  • Quebec: maximum of $150,000 (ages 18-80)
  • Other provinces: maximum of $100,000 (ages 18-80)

There are some differences in this plan from a few others available on the market. That includes:

  • No medical required
  • No telephone interview
  • Non-face to face
  • Instant issue
  • 95% approval rate as there is a liberal health declaration
  • Please note that some people may not qualify

LTC Insurance plan in detail: Manulife

Manulife stopped offering dedicated long-term care plans in 2017. However, Living Care available on their CI plans as a covered condition and FutureCare Option is available as an option in their DI plans as a conversion option.

LTC Insurance plan in detail: RBC Insurance

RBC-Insurance

RBC Insurance offers a long-term care conversion plan on their disability insurance and critical illness Insurance products.

LTC Insurance plan in detail: Sun Life

Though Sun Life has offered long-term care insurance plans in the past, the program is closing now and will not be available after June 2021.

The existing policies that are in place will be repriced as of August 2021. A five-year premium guarantee will end at that time and there will likely be increases in LTC premiums for existing customers. Find out more here: https://www.sunlife.ca/slfas/en/resources/news/2021/in-force-ltci-reprice-and-close-of-sun-ltci-to-new-business/

Getting an LTC plan which is best for you

Long-term care insurance is an important part of your financial plan and there is no reason to tackle this important coverage on your own. Experienced brokers with access and quote to all applicable long-term care insurance policies in Canada shop the market for you, and help you find or customize the policy that best suits your needs. Brokers are compensated by the insurance companies when they sell a policy and are not under any quotas. This means they are fair, impartial, and can focus exclusively on your needs.

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