Life-Quotes.ca is pleased to announce a new insurance product available for Ontario and Quebec residents. Ontario Blue Cross has released a life insurance policy that can be combined with Long Term Care and Critical Illness Benefits. Until now, life insurance and LTC insurance policies were purchased separately.

Tangible offers the policy holder some very unique options in their insurance planning. With a hybrid policy, you have insurance that reflects your different needs throughout your life. You have life insurance coverage with a level and guaranteed premium. Coverage starts at $5,000 and goes up to $1,000,000 in increments of $1,000, so you can choose the amount that best suits your individual needs. It also gives you payment options such as whole life, 20 years, paid up at 65, and the rates are affordable.

As well as having life insurance coverage, you have the option of combining Long Term Care coverage. By having this hybrid policy, should the need arise; your policy can be converted to suit your changing needs. By having this plan, you can avoid the traditionally more expensive LTC rates, as this plan only converts if and when needed. The rates are leveled and guaranteed, so you can avoid purchasing a separate LTC policy with rates that are subject to being raised. If you suddenly find yourself needing LTC, you can convert either 2 or 5% of the initial amount. Benefits are paid monthly and are tax-free. Critical Illness coverage can also be purchased with this policy, thereby covering every possibility that may occur in your lifetime.

There are some health questions needed in order to be eligible for this type of coverage. If you currently suffer from such conditions as HIV/AIDS, Alzheimer's disease, Angina, have suffered a stroke and/or heart attack, you are not eligible. Be advised as well that for people with a family history of certain genetic hereditary conditions, you may still qualify for these valuable benefits, at an adjusted premium. Please call Life-Quotes.ca for more information, or consult with a broker to see if this coverage is right for you.

As parents get older, circumstances can sometimes be reversed, and the children assume the care of their parent(s). Loss of a spouse, health concerns and/or advanced age are factors that can affect your parent(s) independence. This role reversal can be a difficult transition for both the parent and the child. However, with open communication and patience, this transition period can be made less difficult.

An issue that can be difficult to discuss with your parent(s) is their financial status. However, in case of sudden death or illness, you need to be aware of insurance policies, bank accounts, etc. If you need to talk to your parent(s) about their finances, here are 5 questions you should ask them in order to obtain the information you need.

Ask for a complete and thorough list of all their assets. Besides the obvious assets, such as a home, cottage and/or vehicles, you need to know exactly what their assets are. This includes bank accounts, real estate investments, pensions, RRSP's, etc. Get copies of all their financial documents, and keep them together in a file folder. In case of illness or death, you will need to have access to these documents.

What are your parents total liabilities? You need to be aware of any current debts that they owe. This is also a good time to discuss different finance options, such as debt consolidation. If they have co-signed for another person's debt, make sure you obtain this information as well.

Are your parents going to need financial support in the future? Realistically look at their income from pensions and/or savings. Will this be enough to support them, and for how long? How much income is generated from their investments? If your parent(s) have not managed to adequately save enough, this is the time to talk to your sibling(s) or other family members about financial support. You may want to consult with a financial planner about investment options.

Do your parents have insurance coverage? Ask to see all current insurance policies your parents have. Health insurance is critical at this stage in life, as well as life insurance. This includes any policies that they may have from employee benefits, as well as any that they have purchased. Check to see what kind of coverage they have, and any terms and conditions of the policies. If they have term life coverage, check to see when this expires. If they do not have adequate coverage, this is the time to consult with your insurance broker and obtain the policy that is right for them. You also need to be aware of who is named as the beneficiary, and update this if necessary. Get copies of all insurance policies so you have access to the information if needed.

Discuss Power of Attorney. Although this can be a very sensitive topic, you need to discuss what will happen in case of sudden and/or prolonged illness. Talk to your parents about who they would like to take on this responsibility, as well as their wishes. Talk to them as well about their wishes in regards to a living will.

It is important to discuss these financial issues as soon as possible. By having a complete picture of your parents' financial status, you can make plans accordingly. If you discover that your parents don't have sufficient life insurance coverage, you may want to consider a Guaranteed Issue policy. There is no medical questionnaire and acceptance is guaranteed. This is beneficial for those who have current health issues. There is also Guaranteed Issue Health Insurance, for those who do not have coverage. This also does not require a medical exam. Health insurance is imperative for the elderly, as their risk for developing health problems increases. Talk to your parents and your insurance broker to ensure that they have adequate coverage.

The health problems associated with obesity are quickly rising, leaving Canadian healthcare facilities ill-equipped to deal with the issue. It is estimated that 11 million Canadians are overweight, with a half a million being morbidly obese. Statistics Canada has reported that 2 out of every 3 adults are overweight or obese. The obesity rate in children has tripled in the past 25 years.

Canadian clinics and hospitals are being overwhelmed with the volume of patients needing healthcare due to being obese. Experts are calling for a major infusion of money into the healthcare system in order to be able to deal with the added burden on clinics and hospitals. The effects of obesity on the healthcare system is rapidly rising, and could soon eclipse those of smoking. Being overweight or obese means an increased risk of serious diseases and/or conditions such as:

• Hypertension
• High blood pressure
• Coronary heart disease
• Diabetes
• Stroke
• Gallbladder disease
• Osteoarthritis
• Sleep apnea
• Respiratory problems
• Breast and colon cancer

For most Canadians, being overweight or obese is a reflection of the changes in society. The workforce is more technologically oriented, with more people sitting in front of a computer. For children, TV and video games have replaced more physical activities. This means more people are living a sedentary lifestyle. Hectic lifestyles make less time for exercise, with the added option of fast food/takeout food. Quite simply, Canadians need eat less and be more active.

Being overweight or obese can impact your life insurance rates. When applying for a life insurance policy, you will be asked about your health status. Higher health risks means higher premiums. As with smoking, behavior that has a negative impact on your health means you will not be eligible for the preferred health status.

Many Canadians receive group insurance, otherwise known as employee benefits, from their employer. These plans usually include some form of health and/or life insurance coverage. Group insurance comes in different funding formats. Employers can choose from different funding methods to suit their company's needs.

There is a wide range of funding methods. Fully pooled plans are where the insurance company sets the premium and also absorbs all the risk. Self insured plans have the employer bearing the risk, with the insurer paying the eligible claims. Experience rating occurs where all or part of the risk is shared by both parties. The funding method that is best for your company depends on many factors, such as:

• Number and/or type of employees
• Type of risk you wish to cover
• Premium volume
• Prior claims patterns
• Employer’s ability to accept risk

For a business with a smaller number of employees,  a non-refund or non-retention accounting plan is a good option. Benefits which are payable infrequently (i.e. death or long-term disability benefits) are usually pooled so that these claims are combined with those of other groups. Due to the low incident rate of these types of claims, it is better for the insurance company, rather than the sponsor (employer), to determine required premium rates based on analysis for the entire block of business. There is some funding flexibility available for short-term disability benefits. The sponsor can purchase a weekly indemnity benefit, as well as be self-insured through a sick leave and/or salary continuation plan. Additional supplementary health and dental benefits are usually insured, although their cost will often be adjusted to reflect your actual experience. The larger your employee group is, the more likely your plan will be experience rated, with past claims patterns establishing your future premium requirements.

A fully pooled basis plan does not participate and/or share in the financial results generated by the experience of the plan. The insurance company keeps any profits generated if the amount of premiums paid exceeds claims and expenses. However, the insurance company is responsible for absorbing the costs of any losses if claims and expenses exceed the premiums paid.

For a business with a larger amount of employees, there are different options for group insurance. Benefits such as accidental death and dismemberment (AD&D) and business travel accident are typically fully insured due to the fact that these claims are infrequent and usually in high amounts. As a group grows in size, more funding methods become available as the claiming patterns tend to be more predictable.

Prospectively Rated Approach: This is similar to a fully pooled group in all aspects except for the setting and/or renewal rates. However, unlike a pooled group, premium rates for a prospectively rated plan are determined either in whole or part by the group's claims experience. Although future rates are determined by past claims, this plan is similar to the pooled approach in that the insurer assumes the risk of any shortfalls, but also benefits from any surplus.

At the other end of the spectrum are plans for large employers where a large amount of small claims are expected. This plan can be set up on an ASO Basis "Administrative Services Only". With this arrangement the employer bears the expense of the total amount of claims paid each period plus a handling charge to the insurance company. An ASO account can be set up in 2 ways, depending on what works best for you.

Billed In Advance: Rates are established based on prior claims activity. At the end of the policy year, total premium paid is compared to claims paid. The sponsor is fully refunded any surplus, and assumes immediate responsibility to pay the insurer any deficit which may be owed. This plan offers the sponsor the advantage of level plan funding throughout the year.

Monthly Billed In Arrears: A float of approximately 6 weeks of estimated claims is taken. At the end of the month a bill is produced showing actual paid claims plus expenses. At the end of the policy year an accounting is done, with any surplus being refunded to the sponsor, and with any deficit being the responsibility of the sponsor. Under this plan, there should not be a substantial surplus or deficit, as actual claims are being billed on a monthly basis. These benefits can be insured, but their ultimate cost will equal the client's actual expenses, plus the reserve charges, a cancellation risk margin and premium taxes. There is no pooling and as such, the long term cost can be considerably higher than that under an ASO arrangement.

Larger employer's group life insurance and long-term disability typically are insured with some form of experience rating or partial pooling being applied by the insurer. The characteristics of a group and it's premium volume determine the financing method(s) chosen. A partially experience-rated contract is the closest to the fully pooled method, which recognizes the employer's experience, whether it is good or bad. If a surplus is realized at the year's end, a refund could be issued, or the premium rates could be lowered. This arrangement is known as "retention" or refund accounting.

Refund accounting establishes the rates based on prior years claims similar to a regular experienced rate account. However, it differs with regards to the sharing of the risk. At the end of the year, an accounting is performed with total claims paid being compared to the premiums paid after all the expenses and reserves are removed. If a surplus remains a certain percentage is made available to the policyholder either in a rate reduction for the following year, or in a lump sum. Deficits are the sole responsibility of the sponsor and are usually amortized over a 2-3 year period under a deficit recovery component which is built into the future rates. This type of funding arrangement requires a Claims Fluctuation Reserve, which is a specialized buffer as a safeguard against financial deficits. This is a fund established by the insurer with the sole purpose of offsetting any deficits. It is funded from previous plan surpluses. This provides the insurer with protection against shortfalls due to future poor experience, as well as the possibility of the plan terminating in a deficit. Once the CFR is fully funded, and future surplus is available to the sponsor in the form of a refund, and the "risk charge" is usually reduced.

Stop Loss – ASO and Retention: Most plans, whether fully insured, ASO, or somewhere in between have some sort of protection against catastrophic claims. Stop loss protection is a part of the financing methods which places emphasis on the maximum level of claims to be recognized by the insurer in its experience rating claims. Stop Loss is an arrangement whereby claims are either self-insured or experience rated up to a certain dollar value, after which additional claims are pooled by the insurer. The insurance company calculates the probability of absorbing this loss and charges an appropriate stop loss premium.

Stop Loss – Fully Insured Plans: As newer and more expensive drug therapies have become available, many employers experienced severe financial loss due to only a few employees making claims. This is a new addition that is available to sponsors which limits the claim amount used in premium setting to approximately $10,000, after which it is pooled by the insurers.

If you are an employer who wishes to start up a benefits package, or are looking for a new group insurance plan, please contact one of our brokers for assistance.

Parents across Canada will be sending their children off to college or university in a few short weeks. For many, this will be the first time their child is leaving home. When considering what your child needs before they leave home, you may want to consider buying them a life insurance policy if they are not already insured.

Purchasing a policy for a young adult has certain advantages. By purchasing life insurance when you are healthy, you can take advantage of cheaper premiums. If you choose to purchase whole or universal life insurance coverage, you are also starting a solid financial investment for your child. This will give your child a head start on an investment plan for their future. You can also choose term life coverage, which will cover the debts incurred by your child in case of death.

While most government student loans will be forgiven in the event of an unexpected death, students generally have other debts that will not be. The majority of young adults incur debt in the form of credit cards, car loans, etc. that will still be owed. Term life coverage can offset these debts, as well as funeral expenses. Parents can purchase a term life policy which will cover their child during their university/college years until the child is in the workplace and able to afford their own insurance.

Buying whole life insurance for your college-aged child has a lot of advantages. Acquiring coverage while the insured person is in good health means that the premiums will be lower. The premiums for whole life cover can also be spread out over a long period of time. A parent can therefore cover the costs while their child is in school, and then allow the child to take over the payments. This will give your child the advantage of lower premiums because it was bought early on. Whole life policies also have a cash value, so your child will have a head start on financial planning. This can be especially helpful throughout your child's life.

You may also want to consider the benefits of purchasing universal life coverage. This will allow you to obtain coverage for your child which is flexible. Your child can adjust his/her policy as their needs dictate, such as getting married, having children, buying a home, etc. This type of life insurance allows your child the benefits of having a policy that builds up cash value, but is less rigid than whole life.

It is advisable to discuss these options with your child to determine which type of policy fits their needs and your budget. Take advantage of their current good health status, in order to save them money in the future. Consult with one of our representatives who can assist you with any questions or concerns.