Sun Life Financial recently grafted a conversion to long-term care insurance (LTC) option onto its basic critical illness product. The insurer also plans to market a long-term care product for the independent advisor network starting in the second quarter of 2009.

The convertible long-term care market had been a relatively empty playing field, apart from pioneers such as RBC Insurance. Interest in LTC hybrids recently took off spectacularly, ignited by the launching of Blue Cross' hybrid product Tangible in 2007, followed by UL Mutual's AdaptCI Hybrid+ in 2008. Both products combine critical illness and long-term care in one policy.

Critical illness policy rider

Sun Life is offering LTC as a rider on its critical illness policy. Policy holders can convert the product between ages 60 and 65.

"Our product is different from other products because we guarantee that an LTC product is available at the time of conversion. Also, insured do not have to answer questions about their health when they convert their policy," David Baker, assistant vice president, individual health product development at Sun Life explains.

Mr. Baker points out that Sun Life is the first insurer in Canada whose critical illness product covers acquired brain injury. Loss of independent existence decline has been added as an optional benefit, and children can be insured starting at the age of 30 days.