Most have little confidence they have financial resources to cover costs of recovery
WATERLOO, ON, July 4, 2002 – Most Canadians expect they
will need to dig into their savings and investments to finance expenses incurred from a
critical illness, according to a new survey funded by Manulife Financial.
While most Canadians are aware that expenses like travel to
medical appointments, child care and home care might not be covered by their provincial
health care plan or employee benefit plan, only 16 per cent of this group are very
confident that they have the financial resources on hand to cover the costs of recovery.
Seven out of 10 unaware of coverage available
The survey also notes that 71 per cent of Canadians are not at all familiar with a
relatively new insurance product in Canada called “critical illness” insurance.
“This reconfirms our belief that Canadians need to
learn more about the financial benefits critical illness insurance can provide,” says
Michael Doughty, Vice President Individual Life Marketing and Product Development.
“It’s designed to ensure people have the financial resources they need so they can
focus on getting better. The last thing they need is to be weighed down with the stress of
managing to cover costs associated with their recovery or worrying that they’re depleting
their retirement savings.”
Among those surveyed who expect to pay extra recovery
expenses, 23 per cent said they would likely tap into their RRSPs to do so.
Fully one-third of those expecting to pay extra expenses
would draw on their savings accounts and other investments. Twenty per cent would take out
a bank loan, 18 per cent would borrow from family or friends, 13 per cent would sell some
property or possessions to pay recovery bills, while 12 per cent said they might re-mortgage their home.
Provides lump-sum payment
Critical illness insurance eases the financial burden of a
life-altering illness by providing a lump-sum cash payment upon survival of a waiting
period (30 days in most cases) after the diagnosis of one of several critical illnesses.
Generally, people choose to use the proceeds to finance other treatments, hire a nurse or
caregiver, pay off a mortgage, replace lost income, maintain RRSP contributions, or take a
vacation to help them recover from their illness.
“More and more Canadians are realizing that a serious
illness can be very disruptive to a family’s finances,” says Paul Rooney, Senior Vice
President, Individual Insurance. “Critical illness coverage gives our customers a
simple, hassle-free way to obtain a level of financial protection that is not available
through their life insurance policies.”
Almost half of those surveyed by Market Facts estimated
they could expect to pay more than $10,000 themselves for costs while recovering from
cancer, 19 per cent suggested it might be less, 10 per cent did not expect to pay anything
themselves, while the rest would not make an estimate.
All Manulife Lifecheque policies provide protection against
cancer, heart attack, stroke and coronary bypass surgery, which represent approximately 83
per cent of the critical illness cases in Canada. However, depending on the insured
person’s age and coverage chosen, Lifecheque policies may cover up to 18 critical
conditions, including Alzheimer’s disease, Parkinson’s disease, multiple sclerosis and
receiving an organ transplant.
“Critical illness insurance fills a gap not covered by
traditional products,” says Mr. Rooney. “That may include helping with the cost
of keeping a home or business during recovery, illness-related travel costs, special
medical treatments or other expenses. Many people don’t realize that if you are under the
age of 75, there is a far greater likelihood of getting seriously ill than dying
prematurely. We’re confident that people who know about critical illness insurance will
want to make it an integral part of their overall financial plan.”
The poll for Manulife, conducted by Market Facts between
April 17 and April 21, 2002 surveyed 1002 Canadians aged 18 and older. The results have a
margin of error of +/- three per cent, 19 times out of 20.
About Manulife Financial
Manulife Financial is a leading Canadian-based financial
services group operating in 15 countries and territories worldwide. Through its extensive
network of employees, agents and distribution partners, Manulife Financial offers clients
a diverse range of financial protection products and wealth management services. Funds
under management by Manulife Financial were Cdn$146.7 billion as at March 31, 2002.
Manulife Financial Corporation trades as ‘MFC’ on the TSX,
NYSE and PSE, and under ‘0945’ on the SEHK. Manulife Financial can be found on the
Internet at www.manulife.com.
Critical Illness insurance and Manulife
Critical illness insurance was originally
developed in South Africa in the early 1980s by Dr. Marius Barnard, brother to heart
transplant pioneer Dr. Christiaan Barnard. He noticed his brother’s patients were
surviving their operations and needed financial help as they recovered.
Manulife became a leading provider of
critical illness insurance to Canadians when it acquired Commercial Union of Canada in April 2001.
Manulife offers four different Lifecheque
critical illness plans. Customers can choose from different coverage types and amounts
that can range from $25,000 to $2 million. Depending on the type of plan, a client could
receive a lump-sum payment after a 30-day waiting period or more, depending on the
specific condition covered, if they are diagnosed with any of the following conditions:
- Heart Attack
- Coronary Artery Disease requiring surgery
- Cancer (Some exceptions apply.)
- Multiple Sclerosis
- Loss of Speech caused by physical disease or injury
- Kidney Failure
- Major Organ Transplant recipient
- Loss of Limbs
- Alzheimer’s Disease before age 75
- Motor Neuron Disease (ALS or Lou Gehrig’s Disease) before age 75
- Occupational HIV Injury
- Parkinson’s Disease before age 75
- Severe Burns