Survivorship Series - Why Living Benefits Are More Important Than Ever
Dr. Marius Barnard drove development of the first Critical Illness policy in 1983 because he understood that after centuries of mortality improvement, death was no longer our greatest financial worry. Instead, his patients were often equally worried about the financial consequences of actually surviving a serious illness. More than three decades later, many Americans are facing the perfect storm of expensive treatments, higher out-of-pocket contributions and limited savings.
Mortality improvement is not a new phenomenon, nor has there been a common thread to it over time. During the first half of the 20th century, substantial improvement occurred in infant and childhood mortality. Conversely, toward the end of the 20th century and into the 21st century significant advancements were achieved in diagnosing and treating degenerative diseases. This served to slow the progression of chronic diseases and reduce fatality rates in the older population.
Regardless of cause or measurement, it is clear that humans are living longer than ever. This is welcome news…but it comes with a hefty price tag. Cancer and cardiovascular disease are still prominent and will continue to increase in numbers as Americans age. Rather than struggling with the financial repercussion of death, more Americans are besieged with the high cost of survival. With more than two-thirds of all personal bankruptcies citing medical bills as a cause, it becomes clear that living benefits, such as Critical Illness and Disability Income insurance, are more important than ever.
Over the next five months we will examine the core Critical Illness insurance benefit triggers, learn about changes in their associated mortality, and share why this product is more important than ever. The topics will include:
- Surviving cancer and the need for Critical Illness insurance
- Surviving heart attack and the need for Critical Illness insurance
- Surviving stroke and the need for Critical Illness insurance
- Surviving kidney failure and the need for Critical Illness insurance
- Surviving major organ transplant and the need for Critical Illness insurance
The Social Security Administration is projecting that mortality improvement will continue into the future. Its 2011 Technical Panel on Assumptions and Methods suggested that by the year 2085 the average life expectancy at birth will have risen to 88.7 years. One way of looking at this would be to assume a flat 1.26% rate of improvement annually. Our upcoming blog series will examine some of the breakthroughs that may help us to achieve this.