Securing against the costs of your long-term care

Understanding the basics of long-term care insurance

Although Canadians are living longer than ever, there's a greater than 40% chance anyone over 65 will need some type of extended care not covered by provincial health insurance. Make sure you’re financially prepared.

Living longer doesn't necessarily guarantee enjoying perfect health. What would happen if your spouse or one of your parents developed an illness requiring long-term care? Who would pay for that? You may think provincial health care would pick up the tab, but in many cases, coverage is partial or for a limited time. Then what? You may very well exhaust your savings paying for nursing care, special equipment, facility costs, and medication. That's why a long-term care insurance policy is well worth the investment.

Add up the financial and emotional costs

The Canadian Council on Aging reports that two out of every three Canadian couples over the age of 65 will require long-term care for at least one spouse. If this were to happen to one of your parents, could they cover the costs? Or would you and your siblings have to carry the financial burden?

The costs of chronic care are high and continue to rise. Annual costs for a private facility, for example, can start at around $40,000 a year. Round-the-clock care at home is even more expensive. When aging parents need long-term care, the emotional and financial repercussions are likely to span three generations. Grown children may suddenly find themselves having to sacrifice key goals for their own children, such as education savings, to look after their parents.

Long-term care insurance can help your family prepare for these open-ended costs and allow you to choose the most appropriate care for a loved one, without depleting your savings or sacrificing key goals.

Ensure quality of choice and quality of care

Long-term insurance pays out benefits for care in a senior care facility or a private home. It generally covers physical problems and cognitive impairments such as dementia or Alzheimer's. Benefits can pay for 24-hour care in a long-term care facility, medical care, daily care in an adult day care centre, home services for an RN, homemaker services, respite care to allow a caregiver a break, and other related expenses.

Fortunately, there are more and more health care options available now with a greater focus on bringing services into the home. Having a greater choice and the insurance coverage to pay for it allows you to customize a long-term care plan that works for everyone.

Plan ahead for your parents – and yourself

While your parents are still healthy, work together to put a plan into place. Do they have long-term care insurance or the financial means to comfortably afford long-term care? If not, you might consider helping your parents purchase long-term care insurance, perhaps sharing the cost of premiums with your siblings.

You and your spouse may want to think about a long-term care plan for yourselves, too. Eligibility begins at age 40, and generally the younger you are, the lower your premiums will be. Your BlueShore insurance advisor can provide a variety of options to protect everyone in your family.