As we know very well, long-term care insurance is becoming more of a concern with clients approaching their retirement date. Often they have seen their parents need a range of support from a personal support worker to full time care in a facility and are worried what will happen to them when the time comes. A challenge I’ve found with long-term care policies is that without ROP you’re hoping that the policy a client has contributed to for possibly decades will pay out some benefit. Fortunately, there is an alternative that can guarantee in a worst case scenario that it will pay 100% or even 125% of the stated benefit!
There is a unique life insurance product available through Desjardins and Industrial Alliance designed to be flexible enough to provide a living benefit (without the requirement of loans) if a client should need long-term care. Like traditional life insurance, this policy WILL pay a death benefit regardless, and in some cases pay 125% of the death benefit throughout the lifetime of a client.
For an example of how this works, let’s use a $1,000,000 face amount just as an example.
A client takes out $1,000,000 and requires long-term care. The policy will pay a benefit of 1% per month for 100 months. That is equivalent to $10,000 per month for 100 months!
The same client passes away in month 101, after they’ve exhausted the living benefit. Their beneficiaries receive $250,000 – 25% of the death benefit!
This client has received 125% of the face amount and had funding available when they needed it.
For more info, please contact your Business Development Specialist at QFS.
Ken Poniatowski, CFP®
Business Development Specialist