Sun Life Financial Inc. has introduced Sun Care Whole Life, a single premium whole life insurance policy with a linked benefit that owners can apply to long term care costs, including in-home care, assisted living, and nursing home facilities.

Approximately 70 percent of people over 65 will eventually need long term care, according to the Department of Health and Human Services. Linked benefit policies can protect beneficiaries against long term care expenses while also providing the benefits of tradtional life insurance.

Currently available in 39 states, Sun Care whole life may provide a long term care benefit equivalent to as much as three to seven times the value of the policy owner’s single premium, depending on factors such as the riders selected, age, gender, and smoking status. If the insured passes away without exercising the long term care benefits, a death benefit goes to the beneficiaries, income tax-free. The policy also provides, for an additional fee, an optional return-of-premium feature, which if elected, allows policy holders to recoup the value of their original premium.

Once the policy owner pays the single premium, the policy is guaranteed to provide a benefit, either to the individual or the beneficiaries. This offers several possible advantages over traditional long-term care insurance, which only provides a benefit if the client makes a long-term care claim, requires ongoing premiums to fund the policy, and provides no death benefit if a policy owner never needs long-term care.

A recent Sun Life Financial survey of Americans aged 50 and older details the challenge of long term care planning today. Survey highlights include:

Nearly 60 percent of Americans aged 50 and older worry about long term care costs, and don’t feel confident that they’ll be able to meet those costs: Only 16 percent feel financially prepared to finance their long term care.
Despite such concerns, most people don’t grasp the scale of rising costs; based on conservative historical inflation rates, the cost of nursing home care could rise in 2030 by more than double what they expect.
Most Americans aged fifty and older (87 percent) would prefer to receive long term care at home and be taken care of by their family, if the burden on loved ones were minimal.
People are willing to trade a lot to stay at home. Most Americans aged 50 and older (83 percent) would prefer to live in their home to receive long-term care – even if that meant surviving only 5 more years — rather than live in a long term care facility and survive 10 more years.

Instant Insights /

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