In-force LTCI repricing & closure of Sun LTCI to new business

In-force LTCI repricing & closure of Sun LTCI to new business

  • We’re repricing in-force LTCI policies – Sun and Clarica - beginning August 1, 2021.
  • This reprice will unfold over five years – until 2026. Clients will only see their premiums increase once their five-year premium guarantee period ends.
  • We’re also closing Sun LTCI to new business on June 14, 2021.
  • We’re not increasing rates for Sun Retirement Health Assist (RHA) at this time.

Delivering news of a premium increase can be uncomfortable, but Clients will look to you for guidance and support as they determine how to deal with the change. We’ve got resources to help you every step of the way as you assess the impact on your business, reach out to those affected and continue to seek out long-term-care insurance solutions for Clients

What’s happening and why

Click to expand for everything you need to understand the impact of these changes to you and Clients.

In-force LTCI premiums are increasing beginning August 1, 2021

Beginning August 1, 2021, premiums will go up once a policy’s five-year guarantee period ends. Increases can range from 4% to 40%.

To help limit the impact on policyholders while managing future claims, we’ve capped increases at 40% for issue ages 65 and under. For issue ages 66 and over, we’ve capped increases at 25%.

Why the increase?

LTCI premiums are adjustable and we regularly review our rates. We’re increasing premiums after looking at various factors, including long-term care insurance claims, interest rates, other investment returns, lapses, taxes and other expenses.

The two factors affecting this premium increase are:

  • increased claims costs due to increases in life expectancy (claims will last longer than we expected because people are living longer than ever)  
  • the ongoing low interest rate environment (interest rates have been low for many years and this affects the funds we’ve invested to pay future claims)

How we’re reaching out to Clients

We’re sending letters to Clients at least 10 weeks before their premiums will increase. We’ll continue to do this as each policy approaches the end of its five-year guarantee period.

The letters help explain why we’re increasing rates and what that means for Clients and their policies.

How we’re supporting you

You’ll receive the names of affected Clients, and their premium increases, through Activity Centre. You’ll have this about two months before we notify them. You’ll also receive copies of Clients’ letters when we send them. This cycle will continue until 2026.

Clients will look to you to understand this change and their five-year guarantee period. The advisor toolkit below has resources to help you reach out to them.

What the increases look like

Premium increases can range from 4% to 40% depending on these four factors:

  • the original product purchased
  • the premium paying period for the product  
  • the age of the insured person at the time of purchase
  • the birth sex of the insured person

Average premium increases

Clarica LTCI (all series)

Issue ages

Male

Female

Limited Pay

Life Pay

Limited Pay

Life Pay

21-30

N/A

N/A

N/A

N/A

31-50

40%

40%

40%

40%

51-60

34%

34%

34%

34%

61-65

30%

30%

30%

26%

66+

25%

25%

25%

25%

Sun LTCI 2005

Issue ages

Male

Female

Limited Pay

Life Pay

Limited Pay

Life Pay

21-30

40%

40%

40%

40%

31-50

40%

40%

40%

33%

51-60

34%

34%

34%

27%

61-65

30%

30%

30%

20%

66+

25%

22%

25%

13%

Sun LTCI 2013

Issue ages

Male

Female

Limited Pay

Life Pay

Limited Pay

Life Pay

21-30

12%

14%

10%

12%

31-50

21%

21%

15%

16%

51-60

22%

23%

18%

17%

61-65

18%

16%

14%

12%

66+

10%

6%

4%

4%

Sun LTCI is closing to new sales on June 14, 2021

On June 14, 2021, Sun LTCI is closing to new sales as well as conversions from Sun Critical Illness Insurance.

On June 14, we’ll also update Eos to remove Sun LTCI. You can download Eos V7.4 by clicking the download button in the software or from the Sun Life Advisor Site.

If you have saved Sun Long Term care cases in Eos, you may want to follow the steps below to save the cases in PDF file before you install Eos V7.4.

Steps to save the case in PDF on your machine:

  • From the Eos menu bar, select File and click Open.
  • Select the saved Sun Long Term Care Insurance case and open the case.
  • Click Report Preview and save the PDF report on your machine.

For Clients with long-term care insurance needs

We remain committed to the long-term care insurance market with Sun Retirement Health Assist (RHA). Sun RHA is a great offering for Clients seeking an LTCI solution. It offers simplified underwriting and an unlimited benefit period. Rates are not increasing at this time.

On June 14, we’re lowering the minimum weekly benefit from $500 to $125 to help make this solution even more accessible to Clients.

For Clients who purchase Sun LTCI in spring 2021

Clients who purchase Sun LTCI before June 14, 2021 will receive this premium increase in five years, after their premium rate guarantee period ends. Their illustration will not show the actual increase they will experience at that time.

Transition rules

To ensure a smooth transition, please take a moment to review the following rules:

Processing your application for New Business

Application status

How we will process the application?

Signed and received by June 25, 2021 at 11:59 pm EST
Email:  wholesale.new.business@sunlife.com  Fax: 1-866-693-0324

We’ll process applications as applied for.

Received after June 25, 2021 at 11:59 pm EST.

Application will be returned to firm

Reissue requests received after June 25, 2021 at 11:59 pm EST.

Requests will not be accepted, please contact the New Business Wholesale team for exceptional circumstances.
Email:  wholesale.new.business@sunlife.com 

All cases must be settled and placed by September 30, 2021.

Exercising the Long-Term Care Conversion Option from Sun CII

The last day we will accept Sun CII conversions to Sun LTCI is June 25 at 11:59pm EST. After that time, Sun RHA will be available for conversions.

For more information, please contact your Regional sales director or the Advisor Experience Team.

Advisor toolkit

Sample Client letters 

Standard Client letter

RE:   Your long-term care insurance policy
Policy LI-9876,543,2
Policy start date: October 23, 2002   
Name of insured person: Jane Doe 
Premium payment period: Lifetime  

We value your business and have some important information to share with you.

Beginning on your next policy anniversary, your premium is increasing on your long-term care insurance policy.

Long-term care insurance provides a weekly benefit when declining health leads to a need for substantial assistance from others. The premiums you pay for this coverage can vary based on factors like how old the insured person was when this policy was issued and their birth sex. Your premiums are adjustable and we regularly review these policies. When deciding if we need to change your premiums, we look at various factors, including claims, interest rates, other investment returns, lapses, taxes and other expenses.

Why are we increasing your premiums now?

The two biggest factors affecting this premium increase are:

  • increased claims costs, and
  • the ongoing low interest rate environment (interest rates have been low for many years and this affects the money we've invested to pay future claims).

What does this mean for your policy?

Your current monthly premium is $83.00. On your next policy anniversary, October 23, 2021, the premium will automatically increase to $96.98. We guarantee this new premium will stay the same until October 23, 2026. After this guarantee period, if we need to adjust your premium, we'll let you know well before the effective date.

This premium adjustment doesn't change your coverage.

  • A weekly comprehensive benefit of $385.
  • The benefit is payable for unlimited weeks.

Questions?

You may want to review your policy for detailed information about your coverage, including the premium guarantee. Your advisor, George Lucas, is available to help you review your coverage. You can reach them at 519-123-4567.  You can also reach us at 1 877 SUN-LIFE (1 877 786-5433). We're here to help.

Sincerely,

The team at Sun Life

Letter for Clients whose premiums are being waived

RE:   Your long-term care insurance policy
Policy LI-J123,456-9
Policy start date: October 8, 2006
Name of Insured person: Jane Doe
Premium payment period: Lifetime
We continue to waive your premiums

We value your business and have some important information to share with you.

Beginning on your next policy anniversary, your premium is increasing on your long-term care insurance policy.

Long-term care insurance provides a weekly benefit when declining health leads to a need for substantial assistance from others. The premiums you pay for this coverage can vary based on factors like how old the insured person was when this policy was issued and their birth sex. Your premiums are adjustable and we regularly review these policies. When deciding if we need to change your premiums, we look at various factors, including claims, interest rates, other investment returns, lapses, taxes and other expenses.

Why are we increasing your premiums now?

The two biggest factors affecting this premium increase are:

  • increased claims costs, and
  • the ongoing low interest rate environment (interest rates have been low for many years and this affects the money we've invested to pay future claims).

What does this mean for your policy?

Your current annual premium is $9249.10. On your next policy anniversary, October 8, 2021,  the premium will automatically increase to $9702.70. We continue to waive your premiums. We guarantee this new premium will stay the same until October 8, 2026. After this guarantee period, if we need to adjust your premium, we'll let you know well before the effective date.

This premium adjustment doesn't change your coverage.

  • A weekly comprehensive benefit of $550.
  • The benefit is payable for unlimited weeks.
  • A weekly facility care benefit of $150.
  • The benefit is payable for unlimited weeks.

Questions?

You may want to review your policy for detailed information about your coverage, including the premium guarantee. You can reach us at 1 877 SUN-LIFE (1 877 786-5433). We're here to help.

Sincerely,

The team at Sun Life

Letter for Clients receiving an IP offer and premium increase

RE:   Your long term care insurance policy
Policy LI-9876,543-2
Policy start date: October 23, 2002
Name of Insured person: Jane Doe
Premium payment period: Lifetime


We’re writing to you about your premiums and inflation protection benefit.

Beginning on your next policy anniversary, your premium is increasing on your long-term care insurance policy.

Long-term care insurance provides a weekly benefit when declining health leads to a need for substantial assistance from others. The premiums you pay for this coverage can vary based on factors like how old the insured person was when this policy was issued and their birth sex. Your premiums are adjustable and we regularly review these policies. When deciding if we need to change your premiums, we look at various factors, including claims, interest rates, other investment returns, lapses, taxes and other expenses.

Why are we increasing your premiums now?

The two biggest factors affecting this premium increase are:

  • increased claims costs, and
  • the ongoing low interest rate environment (interest rates have been low for many years and this affects the money we've invested to pay future claims).

What is the amount of this inflation protection offer?

You may choose to increase your weekly benefit by 13 percent without providing medical information. Currently, your policy provides a weekly benefit of $683. The benefit is payable for unlimited weeks.

How does the premium increase and accepting the inflation protection offer affect your policy?

Your current monthly premium is $128.32.

If you accept the inflation protection offer, on your next policy anniversary, October 23, 2021, the weekly benefit amount will increase to $772 and the premium will increase to $206.02.

If you don't accept the offer, your weekly benefit amount won't increase and your premium will increase to $151.37.

We guarantee we can't adjust your premiums before the premium guarantee date - October 23, 2026. If we need to adjust your premiums in the future, we'll let you know well before the effective date. If you accept future inflation protection offers, your premiums will increase.

More information about inflation protection offers

We make inflation protection offers to you every three years. The amount of each offer is based on provincial long term care statistics we track. These offers stop when:

  • you've declined two offers,
  • you've received benefit payments,
  • we're waiving your premiums,
  • your policy is paid-up and we require no further premiums, or
  • the insured person reaches the age of 85.

Accepting an inflation protection offer does not change your premium guarantee date. 

To accept the inflation protection offer, return the attached form in the envelope provided.  If we don't receive your completed form postmarked by September 14, 2021, you'll have declined this inflation protection offer.

Questions?

You may wish to review your policy for detailed information about your coverage including the premium guarantee. Your Customer Care Centre is here to help toll-free at 1 877 SUN-LIFE (1 877 786-5433).

Sincerely,

The team at Sun Life

Key dates to know about

April 27, 2021

First lists of affected policies sent to advisors and firms. Advisors will receive lists of Clients affected in August (April 27) and in September (April 29). Lists will continue monthly.

May 14, 2021

First round of Client letters mailed - sent to Clients at least 10 weeks before their rate change takes effect.

June 14, 2021

Sun LTCI closed to new business. Updated marketing materials available online.

June 14, 2021

Sun LTCI removed from Eos.

August 2021

Clients begin to see premium increases.

NEW CLIENT LETTERS AND LISTS ARE SENT EACH MONTH

2026

Reprice cycle finishes.

Support team contacts
  • In-force policies
  • Close of new business