With more and more cases of dementia in society, the insurance solution is a product that advisors seem to be in the dark about as much as consumers
The solution to coverage for clients with dementia is one that is rarely recommended by advisors and even less frequently thought of by consumers.
“The best coverage for Alzheimer’s or dementia would be long-term care insurance,” said Melissa Harrell from Trilogy Wealth Management. “You would choose a benefit amount to cover your expenses and additional cost of care. The policies are typically designed to last for a client’s lifetime.”
But despite the obvious solution long term care presents it’s fallen by the wayside as the push to bring it into the consciousness of Canadians seems to have stalled.
“Somehow over the last few years I’ve seen less and less discussion on it, and I don’t know what it is,” said Jennifer Martin, CFP, CPCA, senior financial planner with Craig & Taylor Associates. “I don’t know whether it’s because advisors receive so much resistance to the idea of adding this type of coverage for their clients that they just stopped asking but we always consider it in our financial planning.”
The numbers paint a frightening picture for the future. In 2011, 747,000 Canadians were living with Alzheimer’s disease and other dementias, but if nothing changes that number is expected to jump to 1.4 million.
Currently, one in five Canadians aged 45 and older provides some form of care to seniors living with long-term health problems. It’s estimated that by 2040, family caregivers will spend a staggering 1.2 billion unpaid hours per year.
While critical illness and disability insurance are options they have their drawbacks when it comes to dementia.
“Disability insurance usually ends at age 65 so that’s not really going to have a big impact for Alzheimer’s,” says Martin. And while critical illness does offer a lump sum, it’s very unlikely to cover the cost of care over what can sometimes be decades, she said.
Given the amount care costs in Canada, long term care insurance would be the ideal solution.
As Canada’s population begins to age the effects of dementia are being fully felt. Today, the combined direct (medical) and indirect (lost earnings) costs of dementia total $33 billion per year. That number is expected to balloon to $293 billion a year by 2040.
“If you want to directly address the issues of dementia and Alzheimer’s then I would educate clients on what the provincial governments currently offer for care, then have clients consider a long-term care insurance policy with a weekly or monthly benefit amount and a cost of living rider to address inflation of the dollar and health care costs,” said Harrell. “There is also an added benefit of being able to refund the premiums to the clients estate should the policy not be used.”
“The best coverage for Alzheimer’s or dementia would be long-term care insurance,” said Melissa Harrell from Trilogy Wealth Management. “You would choose a benefit amount to cover your expenses and additional cost of care. The policies are typically designed to last for a client’s lifetime.”
But despite the obvious solution long term care presents it’s fallen by the wayside as the push to bring it into the consciousness of Canadians seems to have stalled.
“Somehow over the last few years I’ve seen less and less discussion on it, and I don’t know what it is,” said Jennifer Martin, CFP, CPCA, senior financial planner with Craig & Taylor Associates. “I don’t know whether it’s because advisors receive so much resistance to the idea of adding this type of coverage for their clients that they just stopped asking but we always consider it in our financial planning.”
The numbers paint a frightening picture for the future. In 2011, 747,000 Canadians were living with Alzheimer’s disease and other dementias, but if nothing changes that number is expected to jump to 1.4 million.
Currently, one in five Canadians aged 45 and older provides some form of care to seniors living with long-term health problems. It’s estimated that by 2040, family caregivers will spend a staggering 1.2 billion unpaid hours per year.
While critical illness and disability insurance are options they have their drawbacks when it comes to dementia.
“Disability insurance usually ends at age 65 so that’s not really going to have a big impact for Alzheimer’s,” says Martin. And while critical illness does offer a lump sum, it’s very unlikely to cover the cost of care over what can sometimes be decades, she said.
Given the amount care costs in Canada, long term care insurance would be the ideal solution.
As Canada’s population begins to age the effects of dementia are being fully felt. Today, the combined direct (medical) and indirect (lost earnings) costs of dementia total $33 billion per year. That number is expected to balloon to $293 billion a year by 2040.
“If you want to directly address the issues of dementia and Alzheimer’s then I would educate clients on what the provincial governments currently offer for care, then have clients consider a long-term care insurance policy with a weekly or monthly benefit amount and a cost of living rider to address inflation of the dollar and health care costs,” said Harrell. “There is also an added benefit of being able to refund the premiums to the clients estate should the policy not be used.”
