Younger Canadians more worried about catastrophic illness: Poll

(January 14, 2003) Younger people are more worried about suffering a severe illness such as a stroke, cancer or heart attack than middle-aged or older Canadians. And Canadians who have a financial advisor want their advisor to tell them about their options, according to a poll by Ipsos-Reid and RBC Insurance.

The survey, conducted in October, found that just over half of Canadians (54%) believe they will have enough money to manage their expenses if they suffer a critical illness. Men were slightly more likely than women to believe they had enough savings.

While critical illness coverage is one of the fastest growing areas of the insurance market, only about half of Canadians have heard of the coverage, the survey found.

"People know that a serious illness such as cancer, stroke or heart attack can have a dramatic effect on their family’s financial security and lifestyle," said Kathryn Giffen, president of the RBC Life Insurance Company, a division of RBC Insurance. "It’s also important that Canadians be aware that there are products that will allow them to recover from illness and maintain their quality of life without the stress of taking on debt or depleting retirement savings."

Critical illness polices provide a lump-sum payment to those who survive an illness. For Canadians, the top concerns about surviving an illness were maintaining their lifestyle and paying their bills. Other concerns included being able to support a family, coping with job loss and being able to contribute to RRSPs.

Older Canadians were less worried about suffering a critical illness or having a family member suffer a critical illness than younger or middle-aged Canadians, with 70% of older Canadians expressing concern compared to 85% of younger Canadians and 79% of middle-aged Canadians.

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The survey also found that Canadians without critical illness coverage were interested in hearing more, and that roughly two-thirds of those who have a financial advisor but do not have critical illness coverage expect their advisor to tell them about it.

About half of younger Canadians polled were interested in hearing from an advisor about critical illness insurance, compared to a third of middle-aged Canadians and about 23% of older Canadians.

"Canadians should ensure their financial plan takes into consideration all their insurance needs," added Giffen. "Critical illness insurance is one of the components of a comprehensive financial plan."

Advisor.ca will have coverage of the inaugural world critical illness insurance conference in Vancouver, starting on Friday.

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Are the survey results consistent with your findings in your practice? How do you effectively deal with your clients’ insurance needs? Can raising the topic of insurance help or hurt your relationship with your clients? Share your views in the “Insurance” forum of the Talvest Town Hall on Advisor.ca.

Filed by Scot Blythe, Advisor.ca, sblythe@advisor.ca.

(01/14/03)