Government statistics around the globe reveal an aging population that is projected to trigger significant economic dilemmas — including long-term health care costs.
In an effort to alleviate the burden of health care costs among an aging population, Advocis, the Financial Advisors Association of Canada, updated the Registered Health Underwriter (RHU) designation, which enables financial planners to become experts on living benefits.
Advocis representatives believe that a major risk for people who live longer, and for those who care for them, is the increased financial burden associated with medical treatments and health care facilities. Taylor D. Train, chief operating officer of Advocis, says providing clients with timely information on living benefits could help mitigate the risks associated with age-related health ailments.
“It is of critical importance that financial advisors and planners have the most up-to-date information for their clients,” Train says. “With Canadians living longer and more needing this kind of financial protection, there will be more clients looking for this kind of advice.”
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He says Advocis has been working on the revamped designation for a couple of years. “Back in 2006 we had a look at the courses we offered and realized that the material had not really been brought up to date since its inception in 1995.” Train says. “Then we looked at what had happened in the Canadian marketplace and the influx of health-related products. This, combined with the fact that there is no valid designation that addresses the need for living benefits, and we decided to revamp the Registered Health Underwriter’s courses.”
Train also confirmed that the update — which called upon industry-leading specialists in underwriting, claims and marketing to coordinate the revision and review of the content — was to ensure the course reflected the realities of the current Canadian marketplace.
The RHU is the only living-benefits designation available to financial advisors and planners in Canada, explained Train. With the successful completion of the RHU program, advisors and planners are able to provide strategic living-benefits advice in all areas including income replacement, group benefits, critical illness protection, health insurance and long-term care issues.
While Train recommends that advisors ask their clients if they are facing concerns regarding elderly parents, he also prompts advisors who hold the RHU designation to talk to their clients about living-benefit protection before their retirement and senior years.
“These products are not just for people getting older. They are there to ensure that all people have the flexibility and choice to protect their dignity and financial health, should a sudden and life-threatening health situation arise,” he says. “If you don’t have a plan in place that includes insurance coverage for events like a stroke or heart attack, this can be a big financial threat to your family.”
Through the RHU course, Advocis offers financial advisors and planners the opportunity to become better educated about these new financial realities, said Train. This educational program ensures that advisors and planners are prepared to give a client the most up-to-date advice about long-term care, disability and critical illness insurance.
While Advocis cannot mandate the RHU designation as a prerequisite for advisors selling living benefits, it is strongly promoting that advisors seek out this designation and that clients expect this designation from their living-benefits advisor.
“This designation is recognized by the industry, and while we cannot expect this designation [of all advisors], we are working with regulators and pushing for clients to expect their financial planner to have this expertise,” he says. “The only difference that any financial planner has, these days, is their ability to command knowledge. This designation gives planners, compliance officers, head-office personnel, underwriters, and others up-to-date information on living benefits.”
Currently, 700 financial planners hold the RHU designation in Canada, said Train, and since its inception as an industry designation in late 2006, there have been more than 1,000 enrollments in the course.
“Canadians have a lot of misconceptions about who will help when they are threatened with a long-term illness or disability,” continued Train. “The reality is that there are social safeguards in place, but they will not necessarily address all your financial needs. This is why individuals must act to protect their financial well-being. An RHU-designated financial advisor or planner is prepared to help ensure that the plan is in place. And a diligent person can complete the course work in a year,” explained Train.
Filed by Romana King, Advisor.ca, Romana.King@advisor.rogers.com
(08/19/2008)