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Long Term Care Insurance

Updated: Feb 24, 2022

Long Term Care Insurance provides a weekly benefit amount in the event that you require care to perform day-to-day activities. In this post, we review why this coverage might be relevant and some of the policy features to consider.

It’s easy to take for granted our ability to perform day-to-day activities. Canada’s aging population as the baby boomers move into retirement is testing governments’ ability to provide healthcare for those who do not have the means to support themselves.

In preparing for the care years, we all want to have the financial resources to let us choose the type and level of care that works for us and our families. It's also important to protect the funds set aside for retirement.

Long Term Care insurance can help you fund the cost of bringing care into your home if you don’t wish to move to a facility and lessen the burden on caregivers like family members. Benefits are payable regardless of whether you remain in your personal residence, retirement home, or a long term care facility.

When are benefits payable?

Benefits are payable if you reside in the US or Canada only, however you can travel outside these countries for up to 8 weeks at a time and continue to receive benefits.

To qualify for benefits, you must require at least one of the following:

  • Constant supervision by another person because of deteriorated mental ability

  • Substantial physical assistance with at least 2 activities of daily living

  • Stand-by assistance to perform the daily activity of bathing and transferring to and from your bed.

When should you consider applying for Long Term Care Insurance?

Similar to other types of coverage, you should apply when you’re healthy! Other than that, you must be between the ages of 45 – 71 to apply, keeping in mind that benefits would only be payable from the later of age 65 or 5 years that the policy has been in force.

Added Benefits

The policies come with a few bells and whistles with no extra charge:

  • Automatic Return of Premium: If you pass away prior to coverage coming into effect (the later of 5 years or age 65), all premiums paid are returned to your estate or named beneficiary.

  • Inflation Protection: If you go on claim, the weekly benefit amount will increase by 3% each policy year that benefits are payable.

  • Waiver of premium: Once your claim is approved, you no longer pay premiums

  • Elder assistance: There are services available to help find local, qualified healthcare and personal care providers that meet your needs at every stage of life.

How much does Long Term Care Insurance Cost?

At the time of writing, a 67-year-old male should expect to pay between $400 - $500 / m for a weekly benefit amount of $1,000; payable for the insured’s lifetime.

By obtaining the coverage in the early 60s, a male should expect to pay about $250 / m. Coverage for women is more expensive because they tend to live longer, which means that the care years are expected to be longer.

We'd love to hear from you!

If you'd like to learn more about this type of coverage and how it might fit into your plan, please let us know.


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