What Makes Assumption Life’s Final Expense Solution Different?

Today we are discussing Assumption Life’s Final Expense Solution with two Assumption Life experts:

Cameron Walker (Senior Product Manager, Individual Insurance) andDaniel Audet (Associate Vice-President, Individual Insurance and Investments).

Here are their answers about the product:

How has the final expense marketplace changed in Canada in recent years?

More than 5 million Canadians will turn 65 in this decade (note: in 2020, 6.8 million out of 38 million Canadians were 65 and over) and this will significantly increase the number of individuals looking to sort out their affairs in the last phase of their life. The Baby Boomers have left a big imprint in our society over their working lives, showing the way with their buying patterns. They will certainly continue to impact consumerism as they retire.

Turning to an insurance focus, a recent CLHIA survey shows that the number one reason for Canadians to have life insurance is to cover final expenses. Not surprisingly, this growing opportunity has recently attracted new entrants to this market, looking to meet market needs while also finding ways to wrap the insurance “core” offering with additional benefits, products and services to better differentiate and add value. We’ve seen free wills, powers of attorney documents, executor kits, and grief and funeral concierge services being offered, just to name few.

One of the biggest changes, however, is happening right now with the recent pandemic. Seeking to innovate in the digital solution arena, insurers are providing Canadians with simplified life insurance solutions with an easier and faster client experience than before, and from the comfort of their own home. Advisors have been seeking innovative ways to tap into this market with the use of technology and the tools provided by the insurers.

Why is life insurance an effective product to cover final expenses?

Final expenses include funeral and burial costs, the final tax return, estate related expenses, and debts. These expenses are the largest concern for aging Canadians. Life insurance is a tax-free tool that is highly effective in covering these costs. The beneficiaries should have fast access to the benefit, without having to endure a long legal process. During their lifetime, the life insured should retain control over who will have access to the benefit. With this setup, families have peace of mind.

Why should Canadians be weary of “no questions asked” guaranteed issue policies?

Those of advanced age or that have a pre-existing health condition tend to like guaranteed issue’s “no questions asked” aspect. However, since these policies come with a high cost, a two year deferral, and low coverage cap, they should only be used as a last resort.

Instead, applicants should first consider a simplified issue solution, which can provide immediate coverage with fewer questions. These applications tend to be more forgiving than a traditional insurance option. If the applicant can truthfully answer ‘no’ to all the questions on a short questionnaire, they can get more affordable coverage when compared to guaranteed issue policies. It is important to note that going through a simplified issue process ensures a much better guarantee of the solution, whereas a “guaranteed” issue product would, ironically, not pay the claim if the death occurs for any reason other than an accident within the first two years (however, the premium is returned to the family).

What is unique about Assumption Life’s Final Expense product lineup when compared with other Canadian carriers?

Assumption Life has one of the largest numbers of immediate simplified issue products in Canada, including for both whole life and term. Our solutions provide affordable whole life options up to age 85 and term options up to age 70. The benefit can cover final expenses ranging from $10,000, $25,000, or more. All our simplified issue plans include additional benefits. For example, clients can access up to 50% of their death benefit if they become critically ill. If necessary, they may be able to access additional funds (beyond the death benefit) of up to $2,000 to help with the cost of returning the body if the death occurs far from home.

Are there times when Assumption Life is best suited for Canadians?

Assumption Life has 25 years’ experience in offering simplified final expense solutions with no medical tests. Canadians who suffer from conditions such as diabetes, obesity, cancer, stroke or heart attacks may qualify for our product. Certain health conditions that the applicant experienced within the last 12-24 months do not necessarily exclude them from qualifying for life insurance coverage without any medical tests.

More about the authors

Cameron Walker FLMI

Senior Product Manager – Individual Insurance, Assumption Life

Daniel Audet MBA

Associate Vice-President, Individual Insurance and Investments, Assumption Life