I first met Dr. Marius Barnard in the fall of 1998. I was a young Sales manager with Canada Life in Niagara and I saw him speak at several of the country wide roadshows promoting an early version of Canada Life’s critical illness insurance (CII) to advisors.
For those who don’t know of Dr. Barnard, he was a South African cardiac surgeon and the inventor of critical illness insurance. He was part of a medical team headed by his brother Dr. Christiaan Barnard that performed the world’s first human to human heart transplant in 1967.
I had the chance to see him speak a number of times in my career and I clearly remember his consistent message each time he took the stage…“as a Medical Doctor, I can repair a patient physically, but only an insurer can repair a patient’s finances”. For me, that was my introduction to CII. I am forever grateful for the opportunity to have met him as I have witnessed many clients benefit from owning CII over the years!
When I say ‘benefit’, I am sure most of you would assume that a claim was paid. For the most part, yes, a claim was paid which allowed for countless options for the insured and their family.
Earlier this week I witnessed a client benefit from owning CII without having a critical illness. This client was feeling financial stress due to the economic uncertainty of COVID and the need for tuition money for her daughter’s last year at Brock University. At 55 years of age, she had just retired as a police officer (with a full pension) but was just getting used to her new income levels. She had some RRSPs and other investments but did not want to touch them as she felt it was best that she leaves them intact for a later date. She did however have an in-force CII policy from Canada Life which she purchased when she was 40. As a single mother, she felt it would be good to have CII to protect her up until she retired. Since her advisor did not last in the business long, she had been without insurance advice for the last 13 years and continued paying the $1,000 per year anyways. Since she retired without having a critical illness claim, she felt now was the time to cancel the contract and save the $1,000. Little did she know, but when she inquired about cancelling her policy, she found out she was getting all of the premiums ($15,000) back that she had paid over the last 15 years! She thought it must be some kind of mistake! She had totally forgotten what she bought 15 years ago…
Thanks to the late Dr. Marius Barnard for inventing CII!
Thanks to the advisor friend who sold her the policy 15 years ago with Return of Premium rider!
Return of Premium riders are not what they used to be, but there is still a lot of value in considering them when building a CII program. For more information on how to create CII solutions that work, please reach out to a QFS Business Development team member or email firstname.lastname@example.org and start a conversation.
Scott A. Morrow, CEA, CLU
Vice President, Business Development
This communication reflects the views of Qualified Financial Services Inc. as of the date published. The information in this publication is for general information purposes only and is not to be construed as providing individual legal, tax, financial or other professional advice. Qualified Financial Services Inc. assumes no responsibility for any errors or omissions in the information contained herein nor for any reliance placed on such information. Please seek independent professional advice before making any decisions.