No. G-22/94
- General

Recommended Practices for Living Benefits

This bulletin presents 14 "best practices" for the provision and administration of living benefits, also known as "accelerated death benefits."   The Commission is recommending that life insurance companies adopt these practices even though there is no legal requirement to do so.

While the Commission recognizes that most life insurance companies have already taken the initiative to introduce living benefits, not all the practices have yet been implemented.

With adoption of all these practices, the life insurance companies which are licensed to operate in Ontario can set a new standard in the province - and in Canada - for policyholders who are terminally ill.  For those companies which have yet to introduce a living benefits program, the recommended practices provide a convenient framework on which to do so.

In developing these recommended practices, the Commission has consulted with life insurance companies as well as community groups who are involved in issues related to the terminally ill.

Some of the recommendations are as follows:

• All life insurance companies are asked to offer living benefits, subject to limited exceptions for certain types of policies.
• These benefits would be made available, at a minimum, to insured persons with a life expectancy of less than two years.
• Life insurance companies should improve their communications programs so that both their agents and policyholders will become better aware of the living benefits option.

If you require clarification or further information regarding this bulletin, please contact Paul Braithwaite at the Commission at (416) 590-7161, or write to him at the above address.

[Original signed by]

D. Blair Tully
Commissioner

October 25, 1994

Attachment (PDF):

• Recommended practices on living benefits ("accelerated death benefits" or ADBs)