Sun Retirement Health Assist

Why include long term care insurance (LTCI) in your portfolio of product solutions?

You've put a lot of time and effort into helping clients plan for the retirement of their dreams. You understand that retirement is a complex time of life with many changes to finances, health and relationships.

As you build and review retirement income plans for clients, it's important to help them recognize and consider their future health care needs and the impact their choices and expectations will have on their plans. Long term care insurance can help with financial protection for their plans and the means to pay for the level of care they want and expect.

Sun Retirement Health Assist is a long term care insurance solution focused on planning for the health risks associated with later retirement and the realities of aging.

Overview

What is Sun RHA?

Sun Retirement Health Assist is a long term care insurance solution focused on planning for the health risks associated with later retirement and the realities of aging. Fortunately, most of these changes aren't dramatically different from one day to the next - it's more of a gradual process. The level of health care and personal assistance we need, and the cost to meet these needs, will increase with age with the average Canadian experiencing 9 to 14 of the final years of their life in diminished health.

At birth...

  • the average life expectancy of a Canadian male is 78 years. Over nine of those years are expected to be with a diminished quality of life.
  • the average life expectancy of a Canadian female is 83 years. Just over 14 of those are expected to be with a diminished quality of life.*

Sun RHA is designed to protect against the possible catastrophic impact long term care costs can have on even the most solid of retirement savings or income plans.

  • Sun RHA offers a unique design and competitive features which have simplified the application process significantly:
    • Shorter application with immediate feedback for most declines while completing the application.
    • Underwriting requirements - No medical records, only a memory test by phone for those over 60.
    • Faster turn-around issuing policies.

Sun RHA is a long term care insurance product that helps to cover the costs of care, meaning:

  • Your clients have more choices around the kind of care and amount of care they'll receive.
  • Your clients' savings and investments can be preserved.

As you build and review retirement income plans for clients, it's important to help them recognize and consider their future health care needs and the impact their choices and expectations will have on their plans. Long term care insurance can help with financial protection for their plans and the means to pay for the level of care they want and expect.

Product details

Description of coverage

Sun Retirement Health Assist (Sun RHA) provides an income-style benefit when the insured person is dependent. It helps cover the cost of care over a lengthy period of time, providing the peace of mind that comes with knowing that the financial burden of care won't rest entirely with loved ones.

Sun Life Financial offers the following standalone plan design for single lives:

  • A permanent insurance policy that provides protection for the insured person, after the coverage effective date, when the insured person meets the requirements to qualify

The weekly benefit is paid to the policy owner or the policy owner's estate.

Coverage will end when the insured person dies or when the policy is cancelled.

Issue ages

Policies may be issued to individuals aged 45 - 71.

Weekly benefit amount

The benefit is calculated weekly and paid monthly.

  • Minimum weekly benefit amount: $500
  • Maximum weekly benefit amount (for all LTCI coverage on one insured person): $2,300

Benefit period

The benefit period is the length of time we may pay a claim.

  • Unlimited

The benefit period is unlimited. This means a claim can be paid indefinitely as long as the insured person is alive and continues to be dependent as defined in the contract.

Coverage effective date

The coverage effective date is unique to Sun RHA. It is the date from which a claim for benefits may be submitted. It is calculated as the later of:

  • five consecutive policy years from the policy date, or
  • the policy anniversary immediately following the insured person's 65th birthday. If the policy anniversary is the same day as the insured person's 65th birthday, then the coverage effective date is the insured person's 65th birthday.

Examples

Scenario 1

  • Policy date is December 10, 2013
  • Insured person's date of birth is November 28, 1968 (age 45)
  • The Coverage effective date will be December 10, 2033,
  • because this is the anniversary following the 65th birthday.

Scenario 2

  • Policy date is December 10, 2013
  • Insured person's date of birth is November 28, 1948 (age 65)
  • The Coverage effective date will be December 10, 2018,
  • the 5th policy anniversary from the policy date. The insured
  • person will be 70 years old at that time.

The coverage effective date is an important part of the plan design for Sun RHA. Because of this design, Sun Life Financial is able to offer a simplified application and underwriting process, with the goal of offering this important health insurance solution to a broader target market.

The Sun RHA application is shorter than the traditional application for long term care insurance, and the turnaround time for issuing a policy is faster. In most cases, while completing the application, you will know whether you should submit it, or whether you should consider other options for the client.

Waiting period

The waiting period is the length of time the insured person must be continuously dependent after the coverage effective date and before a claim will be paid.

If the insured person's dependency begins after the coverage effective date, the waiting period starts on the date they first require assistance for two or more activities of daily living or the date they first require continual supervision.
If the insured person's dependency begins before the coverage effective date and it continues, the waiting period starts on the coverage effective date.

There are two options to choose from:

  • 365 days (1 year)
  • 730 days (2 years)

Inflation protection

Sun RHA automatically includes inflation protection. We increase the weekly benefit amount by 3% on each policy anniversary when benefits are being paid. Increases will be compounded annually and rounded to the nearest dollar and there are no caps on increases.

Return of premium on death - automatic

Sun Retirement Health Assist automatically includes a Return of premium on death. This covers the insured person before the coverage effective date.

If the insured person dies BEFORE the coverage effective date the returnable premium amount is payable to the ROPD beneficiary, owner of the policy, or their estate.

Returnable premium amount = the sum of all paid premiums

Who receives payment?

The ROPD beneficiary can be designated when completing the application. The name of the beneficiary must be included in the Special Instructions section of the application. Indicate the full name(s) of the ROPD beneficiary(ies) (with a percentage, if applicable), the relationship to the insured person for Common law policies (or policy owner for Quebec), and if naming a spouse, indicate whether the appointment is revocable or irrevocable.

If this isn't specified on the application, the ROPD beneficiary will be the owner or estate of the owner. Future changes can be submitted in writing to head office. The request must include the policy owner's name, policy name and number and new beneficiary appointment (as above). The letter must be signed and dated by the policy owner.

Additional option

Return of premium on death - optional

An optional Return of premium on death may be added to the coverage at the time of application. This additional option extends the Return of premium on death beyond the coverage effective date.

If the insured person dies ON or AFTER the coverage effective date and the optional ROPD is included on the policy the returnable premium amount is payable to the ROPD beneficiary, owner of the policy, or their estate. If the policy does not include the optional ROPD, any premiums paid are not returned.

Returnable premium amount = the sum of all paid premiums minus benefit payments made

Who receives payment?

The ROPD beneficiary can be designated when completing the application. The name of the beneficiary must be included in the Special Instructions section of the application. Indicate the full name(s) of the ROPD beneficiary(ies) (with a percentage, if applicable), the relationship to the insured person for Common law policies (or policy owner for Quebec), and if naming a spouse, indicate whether the appointment is revocable or irrevocable.

If this isn't specified on the application, the ROPD beneficiary will be the owner or estate of the owner. Future changes can be submitted in writing to head office. The request must include the policy owner's name, policy name and number and new beneficiary appointment (as above). The letter must be signed and dated by the policy owner.

LifestageCare™

Another reason for clients to buy market-leading Sun LTCI and Sun RHA

Owners of long term care insurance with Sun Life Financial have access to LifestageCare™, offered through our partnership with Sykes Assistance Services Corporation.*

LifestageCareTM - resources for clients and families

LifestageCareTM is a national, bilingual, 24/7, unbiased service that gives clients access to information about local, qualified health care and personal care providers closely matching their individual and family needs at every stage of life:

  • Children and teens - for parenting, child care, and special needs services
  • Self care - for personal advice and well being, addiction treatment, budget and credit counseling, and physical rehabilitation
  • Seniors - for aging, retirement residences, nursing homes, home care, and community care

Provide the resources clients need

Focusing on the information and support clients need to provide the best care for their family - they can quickly and easily:

  • find a complete range of qualified local professionals, care facilities, and health care resources anywhere in Canada;
  • accurately determine what home care, rehab, treatment, educational and residential services will cost;
  • obtain professional advice on geriatric care and care for teens and children, including resources for special needs;
  • find simple explanations of treatment options, in language they'll understand;
  • help to know the right questions to ask when choosing a professional caregiver; and
  • stay informed about multiple government financial assistance programs

Specific and confidential

LifestageCareTM is not available to the general public. The answers and information clients receive from the service are matched specifically to them. It is an unbiased service; Sykes Assistance Services Corporation keeps any information provided confidential.

LifestageCareTM demonstration

You can access the LifestageCareTM demonstration on the homepage of www.sunlife.mylifestagecare.ca. The demo will walk through how to navigate the site and highlight the advantages of the service. The demo is also a great tool for prospective clients to see the great benefits LifestageCareTM adds to Sun Long Term Care Insurance and Sun Retirement Health Assist.

Client access to LifestageCareTM

Existing and new LTCI clients can log on to the LifestageCareTM site www.sunlife.mylifestagecare.ca using their long term care insurance policy number. They can also access the service through the toll-free number dedicated to Sun Life Financial clients (1-800-445-1811). To introduce this service to LTCI policy owners, a mail insert (840-3710)
will be included in their annual policyholder statement.
Premium details

Premium payment period

Premiums are payable for the lifetime of the policy until the policy anniversary following the 100th birthday of the insured person, at which time the policy is considered to be paid up and no further premiums are owed.

Frequency - monthly (pre-authorized cheque - PAC) or annually (cheque)

Monthly payments

If a client chooses to pay monthly by pre-authorized chequing (PAC), monthly payments are deducted automatically from the payor's bank account and applied to the premium owing. Monthly premiums are calculated by multiplying the annual premium (including a $50 policy fee) by 0.09 (the modal factor).

For example:

A Sun Retirement Health Assist policy for a 50-year-old woman with an annual premium of $3,000 will have a monthly premium of $270. Monthly premium: $3,000 x .09 = $270

Annual payment

If the policy owner chooses to pay annually by cheque, payments can be remitted to our head office before the policy anniversary date. An annual statement is sent to the policy owner approximately three weeks before the policy anniversary to remind them that their annual premium is due.

Withdrawable premium fund

If we receive more money than is owed in premiums, we will hold the excess amount in the withdrawable premium fund. We may set a maximum amount that can be in the fund. This fund can be used to pay premiums at any time.

The amount in the withdrawable premium fund will earn interest daily. We set the interest rate each day based on short-term interest rates. Interest earned on the premium fund is taxable. The money from this fund can be withdrawn at any time. There may be limits on withdrawal amounts and we may charge a fee for these withdrawals. You'll be informed of any rules and limitations when you submit a withdrawal request.

Premium guarantee

The premium shown on the Policy summary won't change for the first five policy years. After this period, we may increase the premium on a policy anniversary. If we change the premium, we'll tell the policy owner in advance and that premium is guaranteed for at least another five policy years.

Any premium change is based on the insured person's age on the policy date.

We don't consider the insured person's health when we make a premium change.

In this scenario, the purchase date of the policy was January 20, 2013, the premium increases in on January 20, 2022.

Premium guarantee chart

Waiver of premium

When we approve a claim for benefits on the insured person, we waive premiums for the policy.

The premiums must be paid until we notify the client that we've approved the claim.

Reinstatements

The required premiums for the policy must be paid by the due date. If premiums are not paid when due, we will withdraw the unpaid premium from the withdrawable premium fund if it has sufficient funds.

The policy will end if:

  • premiums are not received before the end of the 31st day after they are due,
  • there are insufficient funds in the withdrawable premium fund, and

If the policy ends this way, it is called a lapse. If the policy ended because it lapsed, the owner can apply to have it put back into effect (reinstated) if the insured person is alive.

To reinstate the policy, the owner must:

  • apply within two years of the date the policy ended,
  • provide new evidence of insurability that we consider satisfactory, and
  • make a payment equal to the reinstatement charge we set.

If we don't approve the application, we refund the amount paid to put the policy back into effect

Reinstatement rules at a glance

Number of days from the premium due date

Amount and type of insurance

Evidence requirements

Less than 62

Any

  • None

62 to 180

Any

  • Application for reinstatement, Sun Retirement Health Assist, form 4549

Greater than 180

Any

  • Application for reinstatement, Sun Retirement Health Assist, form 4549, and
  • Usual underwriting evidence, based on attained age at reinstatement
Reinstatements

This document describes the procedure for reinstating a Long Term Care (LTC) or Retirement Health Assist (RHA), policy that has lapsed. The forms listed below can be used for all long term care insurance products.

Reinstatement requirements if the policy has lapsed while the insured person was physically dependent

If the policy owner stopped paying premiums while the insured person was physically dependent, as defined in the policy, and the physical dependency continued longer than the applicable waiting period, the policy owner may apply to put the policy back into effect without giving us new evidence of insurability.

To put the policy back into effect the policy owner must:

  • apply while the insured person is alive
  • apply within one year of the date they stopped paying premiums
  • pay any premiums owed to us, plus interest at a rate set by us, and
  • give satisfactory evidence of the physical dependency and the length of time the insured person was physically dependent.

To apply for reinstatement, complete the following forms:

Reinstatement in all other situations

If the policy has lapsed and the policy owner wants to put the policy back into effect, they must:

  • apply while the insured person is alive
  • apply within two years of the date they stopped paying premiums
  • pay any premiums owed to us, plus interest at a rate set by us, and
  • give satisfactory evidence that the insured person is an acceptable insurance risk.

To apply for reinstatement, the following forms must be completed:

Please note:

  • There is currently no fee for applications to reinstate. (We currently don't charge interest on a reinstatement. But our policies give us the authority to charge interest.)
  • Additional information may be requested at the discretion of the underwriter (i.e. a phone or face to face interview and/or medical records).

Forward the completed form(s) to

Sun Life Assurance Company of Canada

Document Centre 300B25

227 King Street South

PO Box 1601 Station Waterloo

Waterloo, ON N2J 4C5

Claims

Determining dependency

The insured person is dependent when we've determined through objective measures that there are functional limitations for either deteriorated mental ability (cognitive impairment) or activities of daily living including stand-by assistance for bathing and transferring, as described below.

  • Constant supervision by another person because of deteriorated mental ability

    OR

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

    OR

  • Stand-by assistance to perform bathing and transferring

Note: We won't pay benefits when you are outside Canada or the United States for more than eight consecutive weeks.

Deteriorated mental ability (cognitive impairment)

The insured person is dependent when they need constant supervision by another person for protection from threats to their physical health and safety as the result of deterioration in or a loss of:

  • short-term or long-term memory,
  • orientation as it relates to people, place and time,
  • reasoning, or
  • judgment as it relates to safety awareness.

Deteriorated mental ability must result from an organic brain disorder such as Alzheimer's disease, irreversible dementia, or brain injury. The diagnosis must be made by a specialist licensed and practicing in Canada or the United States based on:

  • clinical examination,
  • radiological studies and
  • psychological testing.

Activities of daily living (ADL)

The insured person is dependent when they require substantial physical assistance, with or without assistive devices, to safely and completely perform two or more activities of daily living. Activities of daily living include bathing, dressing, toileting, transferring, continence and feeding. Activities of daily living defined:

Bathing means washing with or without the aid of assistive devices:

  • in a bathtub or shower, including getting in and out of the bathtub or shower or
  • by sponge bath.

Bathing does not include the ability to reach and wash the back or feet.

Dressing means putting on, taking off, fastening and unfastening, with or without the aid of assistive devices:

  • clothing and
  • medically necessary braces or artificial limbs.

There is no dependency if reasonable alterations to or changes in the clothing the insured person usually wears would enable them to dress without substantial physical assistance.

Toileting means getting to and from and on and off the toilet, with or without the aid of assistive devices, and performing associated personal hygiene.

Transferring means moving into or out of a bed, chair or wheelchair, with or without the aid of assistive devices.

Continence means the ability to control both bladder and bowel functions or maintain a reasonable level of personal hygiene (including caring for catheter or colostomy bag) when not able to control bowel or bladder functions.

Feeding means the ability to get food into the body, with or without the aid of assistive devices, through the mouth or by feeding tube. Feeding does not include cooking or preparing a meal.

Stand-by assistance for bathing and transferring

The insured person is also dependent when they require stand-by assistance for bathing and transferring. Stand-by assistance means another person must always be within arm's reach of the insured person so they may safely and completely perform the activities of bathing and transferring.

If the insured person requires stand-by assistance for only one of bathing or transferring, we consider them dependent when they also require substantial physical assistance to perform one of the other ADL.

Assistive devices

Assistive devices are aids that we determine could be used to improve the insured person's functioning. These include adjustable beds, buttonhooks, canes, crutches, grab bars, handheld showerheads, bath brushes, seat lifts, transfer benches, walkers and wheelchairs. If using an assistive device allows the insured person to perform an ADL safely and completely, the insured person is not dependent for that activity.

Making a claim

Coverage effective date

The coverage effective date is unique to Sun RHA. It is the date from which a claim for benefits may be submitted. It is calculated as the later of:

  • five consecutive policy years from the policy date, or
  • the policy anniversary immediately following the insured person's 65th birthday. If the policy anniversary is the same day as the insured person's 65th birthday, then the coverage effective date is the insured person's 65th birthday.

Examples

Scenario 1

  • Policy date is December 10, 2013
  • Insured person's date of birth is November 28, 1968 (age 45)
  • The Coverage effective date will be December 10, 2033,
  • because this is the anniversary following the 65th birthday.

Scenario 2

  • Policy date is December 10, 2013
  • Insured person's date of birth is November 28, 1948 (age 65)
  • The Coverage effective date will be December 10, 2018,
  • the 5th policy anniversary from the policy date. The insured
  • person will be 70 years old at that time.

Waiting period

The waiting period is the length of time the insured person must be continuously dependent after the coverage effective date and before a claim will be paid.

If the insured person's dependency begins after the coverage effective date, the waiting period starts on the date they first require assistance for two or more activities of daily living or the date they first require continual supervision.

If the insured person's dependency begins before the coverage effective date and it continues, the waiting period starts on the coverage effective date.

There are two options to choose from:

  • 365 days (1 year)
  • 730 days (2 years)

When to make a claim

The policy must be in effect on the date a claim is submitted. The insured person must be continuously dependent for longer than the waiting period and the conditions described under the heading, How we determine dependency are satisfied.

Dependency beginning before the coverage effective date

If the insured person's dependency continues beyond the coverage effective date, we must receive a claim as soon as possible and no later than 120 days after the coverage effective date. If we agree the insured person is dependent, we will confirm the date the waiting period starts. Any claim received after 120 days is late and we may decline it without assessing dependency.

Dependency beginning on or after the coverage effective date 

We must receive a claim within 120 days of the start of the insured person's dependency. If we agree the insured person is dependent, we will confirm the date the waiting period starts. Any claim received after 120 days is late, and we may decline it without assessing dependency.

We'll consider a late claim exception if:

  • we receive the claim no later than one year from the date the insured person became dependent, and
  • the claimant provides a written explanation describing why the claim is late and we agree the explanation is reasonable.

Examples

Scenario: not dependent

Jim purchased a Sun RHA policy for himself, with a 365 day (one year) waiting period when he was 48 years old. He recently had hip replacement surgery when he was 67 years old. Due to bending restrictions after the surgery, he required assistance for bathing and dressing for 90 days. Because of the 365 day (one year) waiting period, he recovered before the waiting period was met. Therefore, he should not submit a claim, even though the coverage effective date was met.

Scenario: dependent

The insured person purchased a Sun RHA policy with a 365 day (one year) waiting period when she was 62. At 76 she suffered a stroke and needs assistance for bathing, dressing, feeding, toileting, transferring and continence. The physical impact of her stroke is expected to last longer than the 365 day (one year) waiting period and will likely be permanent. Because she has met the coverage effective date, the claim can be submitted immediately. If the dependency continues beyond the one year waiting period, she will qualify to begin receiving benefits at that time.

How to make a claim

Step 1: Notify us

To make a claim, the claimant should contact Sun Life Financial using the toll free number listed in their policy. This number is 1-877-SUN-LIFE (786-5433). We will then send the appropriate claim form to be completed. You can call Individual Claims Services toll free at 1 877-272-2020 or email ltcclaims@sunlife.com.

The person making the claim must complete the form(s) and give us the information we need to assess the claim.

The insured person must be in Canada or the United States at the time a claim is made. If they aren't, they must return to be assessed by a physician licensed and practising in Canada or the United States.

Before we approve the claim, the insured person's date of birth must be verified. If it's incorrect, we'll adjust the amount we pay to reflect the insured person's correct age.

Policy premiums must continue to be paid until we advise that we've approved the claim.

The form(s) and information must be sent to:

Individual Claims Services
Sun Life Assurance Company of Canada
227 King St S, PO Box 1601, Stn Waterloo
Waterloo ON Canada N2J 4C5

Physicians may charge a fee to complete certain forms. The person making the claim is responsible for any fees for this information.

Step 2: Collection of medical information

The claimant must give us the information we need to assess the claim. This includes our form which must be completed by a physician or another healthcare professional we deem acceptable. The physician must describe the insured person's medical condition, limitations and functional abilities and provide objective medical information about their dependence.

We'll advise if we need any other information to assess the claim, which could include: medical records, clinical tests, physiotherapy reports, psychological tests and any other objective medical information that supports the claim.

Any fees charged by physicians to complete forms or provide information are the claimant's responsibility.

Physicians, specialists or healthcare practitioners who provide information to us must be licensed and practising in Canada or the United States. They may not be the policy owner, insured person, anyone entitled to make a claim under this policy, or any relative or business associate of these people.

We may require that the insured person is examined by an appointed healthcare practitioner. These may be licensed physicians, physiotherapists, occupational therapists, psychiatrists, psychologists or others. We pay for these examinations. We may also require the insured person to authorize us to gather and use information from other insurers or government agencies.

Step 3: Making the claims decision

Once we receive all information needed, we'll assess the information and make a decision. We communicate this decision and pay the benefit to the policy owner or the estate, if applicable. If we deny a claim, we'll send a letter explaining the decision to the policy owner. If the policy owner and the insured person are not the same person, we'll send two decline letters:

  • one letter to the claimant, fully explaining our decision, and
  • a second letter to the policy owner, confirming our denial of the claim. For privacy reasons, no medical information is given to the policy owner.

To contact the Individual Claims Services department, Request Centre - LTCI Claim Inquiry.
Email: LTCclaims@sunlife.com
Telephone: 1 877 272-2020
Fax: 1-866-487-4745

Exclusions and limitations

The policy ends and benefits are not payable if the insured person's dependency started before the later of:

  • the most recent date an application for the policy was signed,
  • the policy date shown under the heading Policy summary, or
  • the most recent date the policy was put back into effect, if the policy has been reinstated.

We won't pay benefits when the insured person is outside Canada or the United States for more than eight consecutive weeks. If we've paid beyond the eight consecutive week limitation, we have the right to deduct the overpayment from any future benefits.

We will not pay benefits if the insured person's dependency is directly or indirectly caused by or associated with the insured person operating a vehicle while their blood alcohol level is more than 80 milligrams of alcohol per 100 millilitres of blood. A vehicle includes any form of ground, air or marine transportation that can be put into motion by any means, including muscular power.

We don't take into account whether or not the vehicle is in motion.

We won't pay benefits if the insured person's dependency is directly or indirectly caused by or associated with the insured person:

  • committing or attempting to commit a criminal offence;
  • attempting to take their own life, while sane or insane;
  • causing themself bodily injury, while sane or insane;
  • intentionally taking any drug other than as prescribed by a licensed medical practitioner and
  • in accordance with the instructions given; and/or
  • intentionally taking any intoxicant, narcotic or poisonous substance. This doesn't include smoking cigarettes, cigarillos, cigars, chewing tobacco or occasional use of alcohol.

We won't pay benefits if the insured person's dependency is directly or indirectly caused by or associated with civil disorder or war, whether declared or not.

Tips for an efficient claims process

  • Ensure you understand the claim triggers and the insured person meets the definition of dependence as defined by the contract. This will help reduce ineligible claims, set better expectations for the insured person and reduce potential expenses.
  • Verify the coverage effective date and waiting period set out in the policy.
  • Ensure the form is complete, signed and dated before you submit it. You'll need to include:
    • the full address (including postal code) of all doctors the insured person has consulted, and
    • the phone number of all doctors the insured person has consulted.
  • Verify the insured person's date of birth and check it against that shown in the policy.
  • It's important that we obtain all medical reports from the physician to support the claim. If the reports aren't sent to us, we can't do a full evaluation, which will cause delays.

Additional references

Cost of care by province

Accommodation costs for facility care vary widely depending on where you live, but your out-of-pocket expenses for long-term care in a facility could range from around $1,000 per month for ward level accommodation in a government-subsidized facility to over $6,000 per month for a private room in a non-subsidized facility.

Home care services provided by the government vary according to the resources available in your community. You may receive a fixed number of hours of home-care services. But if you need to purchase private care beyond what your province provides, the per hour costs for homemaking, personal care and nursing care can vary from $10 to $200 per hour, depending on the type of care you need and the costs in your area.

We have worked with an external service provider, Sykes Assistance Services Corporation, to bring you the following cost of care reports that will help show your clients what they might expect to pay for care services in their home province. These cost sheets outline the services available in each province, but since service availability may also vary by region, you will want to do local research to ensure that you know what costs your clients may face in the event of a long term care situation.

Costs effective November 2017
Frequently asked questions (FAQs)
FAQs that apply to both Sun LTCI and Sun RHA

Why offer two long term care insurance products?

We're innovating and expanding to give you more choices to help meet the needs of more clients. Sun LTCI and Sun RHA address the long-term care health risks in different ways. Each product can work with other insurance or wealth products to meet clients' retirement planning needs.

  • Sun RHA is an insurance solution focused on planning for the health risks specifically associated with a later stage in retirement and the realities of aging.
  • Sun LTCI protects against significant  health and care needs later in retirement with the added security of protection against significant impacts of severe illness or accident that can happen at any time.

Should I consider selling Sun RHA in combination with Sun LTCI?

There isn't a compelling reason to sell Sun LTCI in combination with Sun RHA. Even if a client chooses the lower priced, limited benefit period for Sun LTCI and combines it with the unlimited Sun RHA, the cost of combining both products will always be a little higher because of the policy fee. It's important to remember that Sun RHA does not have the added features of Sun LTCI like the First payment bonus, Palliative care provision, Spousal waiver and Extended term insurance.

Are Sun LTCI and Sun RHA premiums guaranteed?

Both products offer the same premium guarantee:  The premium shown on the Policy summary won't change for the first five policy years. After this period, we may increase or decrease the premium on a policy anniversary. If we change the premium, we will tell the policy owner in advance and that premium is guaranteed for at least another five policy years. Any premium change is based on the insured person's age on the policy date. We do not consider the insured person's health when we make a premium change. 

In the following scenario, the purchase date of the policy was January 20, 2013.

5 year rolling premium guarantee graph

Are Sun LTCI and Sun RHA priced age nearest?

With Sun LTCI and Sun RHA you continue to get the advantage of age last pricing. You'll find Sun LTCI and Sun RHA rates are very competitive when compared against the key competitors in the Canadian LTCI market. Because Sun Life Financial continues to uses age last pricing, many clients may actually be a year younger on a Sun Life Financial illustration than they would be on a quote from a competitor.

Is it possible to pay premiums for Sun LTCI or Sun RHA over a shorter period of time?

Sun LTCI offers a limited payment premium schedule. The applicant can select to have premiums payable to the later of 25 years or to the policy anniversary after age 65. This is not available on Sun RHA.

Both Sun LTCI and Sun RHA have lifetime premiums payable to age 100. 

What's different about the waiting periods for Sun LTCI and Sun RHA?

Each product offers two waiting period options to choose from. The waiting periods for Sun RHA are longer than for Sun LTCI.

For Sun LTCI the waiting period is the length of time the insured person must be continuously dependent before a claim is submitted. It starts on the date they first require assistance for two or more activities of daily living (ADLs) or the date they first require continual supervision. There are two options to choose from: 90 days or 180 days.

For Sun RHA, the waiting period is the length of time the insured person must be continuously dependent after the coverage effective date and before a claim will be paid. If the insured person's dependency begins on or after the coverage effective date, the waiting period starts on the date they first require assistance for two or more activities of daily living or the date they first require continual supervision. If the insured person's dependency begins before the coverage effective date and it continues, the waiting period starts on the coverage effective date. There are two options to choose from: 365 days (1 year) and 730 days (2 years).

Are the criteria for assessing a claim the same for Sun LTCI and Sun RHA?

The waiting periods are different for each product, but the way we determine dependency is the same.  The insured person is considered to be dependent when there is a need for:

  • constant supervision by another person because of deteriorated mental ability (loss of short-term or long-term memory, orientation as it relates to people, place and time, reasoning, or judgment as it relates to safety awareness), or
  • substantial physical assistance with at least two activities of daily living (bathing, dressing, toileting, transferring, continence or feeding), or
  • stand-by assistance to perform bathing and transferring.

Can a client make an LTCI claim when they're travelling outside Canada or the United States?

Our long term care insurance contracts state that "the insured person must be in Canada or the United States at the time a claim is made. If they are not, they must return to be assessed by a physician licensed and practicing in Canada or the United States". Therefore, if the insured person becomes physically dependent and the physical dependency continues longer than the applicable waiting period, they may submit a claim once they have returned to Canada or the US.

Can a client receive LTCI benefit payments while they are outside Canada or the United States?

We will not pay benefits when the insured person is outside Canada or the United States for more than 8 consecutive weeks. The insured person must inform us of the date of departure and when they return to their permanent residence. The insured person must return to their permanent residence for benefit payments to resume.

At the end of each 8 weeks absence, the insured person must return to Canada or the US and their dependency will be assessed as determined by us. If they do not return, benefits payments will cease until they return as required for assessment.

If the client is declined for Sun LTCI, will Sun RHA be automatically offered to them?

If a client is declined for Sun LTCI the underwriter will review the application against a Sun RHA application. If they believe the client may qualify, they will send the advisor an email suggesting the completion of the Sun RHA application. A separate application is necessary. We must ensure we have the client's permission to consider them for Sun RHA coverage. The client must fully understand that Sun RHA has different features and a different level of coverage than they were originally wanting through Sun LTCI.

If the client was declined for Sun LTCI or another company's LTCI product in the past, can they apply for Sun RHA?

They are welcome to apply. They must disclose the decline and provide details about it. It may be possible for them to be considered for Sun RHA.

If the client was declined for Sun LTCI before the December 6, 2013 launch of Sun RHA, how do I know if I can offer Sun RHA to them?

If a client who was declined for Sun LTCI prior to the December 6, 2013 launch of Sun RHA is interested in this new product, the best way to find out if they might be eligible is to complete an application.

Sun RHA is designed to provide a simple application and underwriting process. There are 7 main evidence questions in the personal history section of the application to help identify existing health conditions that represent the highest risk for claims. 

These questions cover the following categories: residency, height and weight, and any significant physical limitations such as the use of assistive devices or the need for assistance or supervision to perform an activity of daily living. It also covers certain chronic health conditions such as multiple sclerosis and diabetes; and it covers smoking status, which relates to certain health conditions such as chronic respiratory disorders and leg ulcers.

Answering the questions on the application will help you determine whether you should submit the application. The final step is to provide details about the previous decline. 

The process to assess a client's eligibility is simple, doesn't take long, and will be more accurate with up-to-date information provided by the client. This allows you to move more quickly to submitting the application and allows the Underwriting team to focus on complete, submitted applications.

How much long term care insurance can one person purchase from Sun Life Financial?

The maximum weekly benefit amount for all LTCI coverage on one insured person is $2,300 per week. This applies to coverage from all sources in Canada.

Are LTCI benefits taxable? Will payment of an LTCI benefit affect a client's government benefits?

Any cash benefits from an income-style long term care insurance plan, such as Sun LTCI, should not be taxed when the policy is owned by and the benefit is payable to an individual.

With an income-style plan, actual medical expenses (e.g. nursing care, facility care, drug costs) may still be used when calculating the medical expense tax credit because the long term care insurance plan provides a cash benefit, not a reimbursement of expenses.

The benefit from the policy is not reported as income, so it should not impact other government benefits, but Sun Life Financial cannot guarantee this.

What is LifestageCare™? Is this similar to Best Doctors® services? 

These services are not the same. Both are value-added services provided to policy owners. Best Doctors services are available for most Sun Life Financial policy owners with critical illness or personal health insurance.

LifestageCare is available to all new and existing long term care insurance policy owners of Sun Life Financial. It's an additional service provided to policy owners and is not a guaranteed feature of the product. The policy owner can access this unique service immediately after the policy is issued and without having to make a claim for benefits, as long as the policy remains in force. LifestageCare services are for the policy owner's personal use but can also be used to help any family member. The service helps families find and assess services in their own community to help with elder, child and personal care.

Click on the following link for more information about LifestageCare services.

Sun RHA FAQs

What is the coverage effective date on Sun RHA, and how does it impact claiming for the benefit?

The coverage effective date is unique to Sun RHA. It is the date from which a claim for benefits may be submitted. It is the later of:

  • five consecutive policy years from the policy date, or
  • the policy anniversary immediately following the insured person's 65th birthday. If the policy anniversary is the same day as the insured person's 65th birthday, then the coverage effective date is the insured person's 65th birthday.

When the insured person's dependency begins on or after the coverage effective date, the waiting period starts on the date they first require assistance for two or more activities of daily living or the date they first require continual supervision. The claim must be submitted within 120 days of the start of the insured person's dependency.

What if the insured person becomes dependent before the coverage effective date?

If the insured person's dependency begins before the coverage effective date and continues beyond the coverage effective date, the waiting period starts on the coverage effective date. We must receive a claim as soon as possible and no later than 120 days after the coverage effective date.

  • When dependency begins on or after the coverage effective date:
    • The waiting period starts on the date they first require assistance for two or more activities of daily living or the date they first require continual supervision. The claim must be submitted within 120 days of the start of the insured person's dependency.
  • When dependency begins before the coverage effective date and continues beyond the coverage effective date:
    • The waiting period starts on the coverage effective date. We must receive a claim as soon as possible and no later than 120 days after the coverage effective date.

There are two types of Return of premium on death (ROPD) for Sun RHA. What are the key the differences?

The first Sun RHA ROPD is automatic ROPD. It is built into to the Sun RHA coverage, and there are no extra premiums to pay for this added protection. 

This means that if the insured person dies before the coverage effective date and before being eligible to make a claim for benefits, we will return all premiums to the ROPD beneficiary named in writing, or if none are named, the owner of the policy or their estate.

The second Sun RHA ROPD is optional ROPD.  The client must choose to add this benefit and pay additional premiums to extend their ROPD coverage for the life of the policy.  This means that if the insured person dies at any time while the policy is in force, we will pay the returnable premium amount to the ROPD beneficiary named in writing, or if none are named, the owner of the policy or their estate.

The returnable premium amount is calculated in the same way as for Sun LTCI:

  • the sum of all premiums paid for the policy including optional benefits
  • minus any benefit payments made
  • minus any unpaid premiums plus interest

Should I sell Sun RHA in combination with Sun CII?

Sun RHA, with a two year waiting period, is a very cost effective way to add long-term care protection to existing critical illness insurance (CII) coverage - especially for those clients deciding whether to keep their CII coverage in retirement. The CII lump sum benefit can be used to deal with the immediate impact of an illness and the Sun RHA benefit is then available to help with any lingering dependencies that result from the illness.

Can the Long term care conversion option on Sun CII be converted to Sun RHA?

Yes - because the Sun RHA benefit period is unlimited, it qualifies as a product offering under the Long term care conversion option on Sun CII.  Sun LTCI continues to be available as well.

What is the commission for Sun RHA?

Sun RHA pays 10% on the first $400 of premium and 8% on the balance. Sun RHA is eligible for NAFYC.

Sun LTCI FAQs

How does the Palliative care provision on Sun LTCI work?

The Palliative care (end-of-life care) provision is only available on Sun LTCI.  Regardless of the waiting period, a claim may be submitted 30 days from the diagnosis if the insured person:

  • has been diagnosed with a terminal disease or illness by a qualified physician or another health care professional acceptable to us,
  • requires substantial physical assistance for at least four activities of daily living, and
  • is receiving palliative care that is supportive and provides comfort.

If someone purchases a Sun LTCI policy with the maximum weekly benefit amount of $2,300, can they also purchase Inflation protection option B which will grow the weekly benefit amount by 2% on every policy anniversary?

Yes they can!  There are no caps on increases. If an applicant wants to obtain coverage for more than the maximum weekly benefit amount of $2,300, this can be achieved by selecting Inflation protection option B. With this option, the initial coverage amount will double in approximately 35 years. Option A also increases the benefit beyond $2,300 by 3% annually while the benefit is being paid.

How do I explain the Spousal waiver feature on Sun LTCI to clients?

This product feature is unique to Sun LTCI. Spousal waiver is not available on Sun RHA.

With Spousal waiver, premiums will be waived if one spouse dies or if we're paying benefits on either spouse's policy (even after we've paid benefits for the entire benefit period on the spouse's policy).

To qualify for Spousal waiver, each spouse must have a policy issued by Sun Life Financial that:

  • includes Spousal waiver and
  • has been continuously in effect with no approved claim, from the dates they came into effect until:
    • both policies have reached their 10th policy anniversaries, or
    • both spouses have had their 86th birthdays.

Once the criteria are met, premiums are treated as follows:

  • When one spouse qualifies for a claim, the other spouse's premiums are waived along with the premiums of the claiming spouse. Premiums continue to be waived even if the claiming spouse's benefit period expires.
  • If one spouse dies, whether or not we are paying benefits at the time, premiums for the surviving spouse are waived.

What happens if the client's financial situation changes and they're unable to make their normal premium payments?

With Sun LTCI, if the client is unable to make premium payments, they may be eligible for an extension of time during which the contract stays in effect. The benefit amount, benefit period and waiting period do not change during this extension. For more information about this policy feature, read the section on Extended term insurance.

Sun RHA does not include the Extended term insurance provision.

Plan changes

This document describes how we handle Sun Retirement Health Assist (RHA) plan changes and internal replacements.

Changes requested during the underwriting process

If the client (the applicant) wants to change the plan before the policy is issued, additional underwriting may be required if the change will increase the risk for us. Please submit the request in writing along with a fully completed Statement of Continued Insurability Form 4398 (SOCI).
Examples of an increase in risk are:

  • increasing the weekly benefit amount
  • decreasing the waiting period, or
  • adding the Return of Premium on Death option.

If the change has no impact on risk, no additional underwriting is required. Examples of no impact
on risk are:

  • decreasing the weekly benefit amount
  • increasing the waiting period, or
  • removing the Return of Premium on Death option

For plan changes of this kind, please submit a request via Request center or e-mail ServiceNow.
Also:

  • There is no fee to process a plan change if the policy has not been issued.
  • Plan changes requested during the underwriting process are effective on the application date and not the date the change was requested.
  • The adjusted premium will be charged as of the application date and not the date the change was requested.

Plan changes after the policy has been issued

To request a plan change after the policy has been issued, complete form E220 - Change form - Long term care insurance
. Please note that only the types of changes listed on the E220 form can be handled as policy changes, all others are handled as internal replacements - see below.

Effective date of the plan change:

  • Plan changes will take effect the month the change form is signed and dated.
  • Premium changes resulting from the plan change request will also take effect the month the change form is signed and dated.

Internal replacements

Some internal replacements require full underwriting. A new policy is issued at current age and current rates. The following transactions are treated as an internal replacement:

Note: In Quebec, advisors must follow the replacement procedure.

  • increasing the weekly benefit amount
  • decreasing the waiting period (i.e. a 2 year waiting period to a 1 year waiting period), or
  • adding the Return of Premium on Death (ROPD) option

Also:

  • If the client applies for an internal replacement for a transaction that is really considered a plan change, we will process it as a plan change. A fee may be applicable and is payable by the client.

For an internal replacement that requires full underwriting

  • Complete a new application.

For Quebec residents the following are also considered internal replacements

If the client is a Quebec resident they need to complete the Prior Notice of Replacement of an Individual Disability Insurance Contract form. This form is available in hard copy only and can be obtained from the Purchase Requisition System by your financial centre purchase co-ordinator.

  • increasing or decreasing the weekly benefit amount
  • increasing or decreasing the waiting period (i.e. a 2 year waiting period to a 1 year waiting period), or
  • adding or removing the Return of Premium on Death (ROPD) option

Forward the completed form(s) to:
Sun Life Assurance Company of Canada
Document Centre, 300B25
227 King Street South
PO Box 1601, Station Waterloo
Waterloo, Ontario N2J 4C5

Sample policies

The following policy wording is provided solely for your convenience and reference. It is incomplete and reflects only some of the general provisions that may be found in some of our insurance policies. We periodically make changes to policy wording and therefore this incomplete sample may not duplicate the wording of any actual issued policy. It is not to be construed or interpreted in any manner as a contract or an offer to contract. The actual policy issued to any given client will govern that relationship.

Target market

This product is available to anyone between the ages 45 to 71, who are interested in planning for their long-term care needs and looking for a solution to help with health care planning at retirement.

Typically, Canadians will need to find their own way when it comes to long-term care. They can rely on their families, but most don't want to burden their families with prolonged care that will impact them financially, emotionally or socially. This means clients can either pay out-of-pocket or provided they know that long-term care insurance exists, they can transfer that risk to an insurance company.

As the demand for health services continue to increase, clients need to understand these costs to better plan for the when they will face these costs later in retirement.

Primary market

This group includes people who are 60 to 71 years old.

They may already be in the retirement phase of life or soon entering it. They understand their retirement income may be at risk from either living too long or from significant health care needs. Because of their age, this market may also have existing health concerns or conditions that preclude them from using Sun Long Term Care Insurance as a solution.

Secondary market

This group includes people who are 45 to 59 years old.

They're not retired, but are actively saving and planning for retirement. They are often providing care and support for their children and parents at the same time. As a result, they understand the health risks that come with aging. They are looking for ways to manage that risk and ensure they have the right plan in place.

Taxation

There are no specific income tax laws for long term care insurance. Based on current tax laws and current CRA interpretation, we believe the following about long term care insurance tax treatment:

Individual ownership

Premiums paid for private health services plans (PHSPs) may be considered eligible medical expenses when calculating the medical expense tax credit. Whether a long term care insurance plan is considered a PHSP (and therefore, whether premiums may be treated as medical expenses) depends on the design of the plan:

  • Income-and indemnity-style long term care insurance plans do not qualify as PHSPs because they do not provide for a reimbursement of medical expenses.
  • Reimbursement-style long term care insurance plans may or may not qualify as PHSPs depending on whether the plan’s list of covered expenses are eligible medical expenses and whether the plan includes return of premium (ROP) features. A plan that includes ROP features will not qualify as a PHSP.

Any cash benefits from income-or indemnity-style long term care insurance plans should not be taxed when the policy is owned by and the benefit is payable to an individual. Likewise, reimbursements made from LTCI plans are not taxed.

With income-and indemnity-style plans, actual medical expenses (e.g. nursing care, facility care, drug costs) may still be used when calculating the medical expense tax credit (because the long term care insurance plan provided a cash benefit, not a reimbursement of expenses). With reimbursement-style plans, this is not the case. However, actual medical expenses in excess of those reimbursed would be eligible for the medical expense tax credit.

Corporate ownership

If the policy is owned by a corporation, we believe:

  • Premiums would not be tax-deductible for the corporation.
  • Benefit payments flowing from the corporation to the insured employee would be viewed as salary to them and taxable in their hands.
  • Tax issues may arise if ownership of the policy is transferred to the insured employee.

Additionally, with corporate ownership, benefit payments may be subject to claims of creditors of the corporation.

If the company pays for the policy but the employee owns the plan, premiums would be considered a taxable benefit in the hands of the employee and would be tax deductible by the corporation as compensation. The benefit, though, would be payable directly to the employee and would not be taxable.

Alternatively, if the company salaried out enough money to the employee to pay the premium plus the taxes on that salary, the employee could pay for the premium with the after-tax proceeds and benefits would be payable directly to them. The company would also get a tax deduction for the amount of salary paid.

Due to the complex nature of corporate ownership, a tax professional should be consulted whenever corporate ownership is being considered.