Desjardins Insurance will stop selling its standalone long-term care insurance product on June 15, 2018. As a result of this decision, and Manulife's recent decision to cease selling LTC, there will be only three individual long-term care product suppliers remaining in the market: Blue Cross (Quebec and Ontario Blue Cross), Sun Life Financial and La Capitale.

Desjardins’ announcement came on the heels of Manulife’s decision to pull its product off the shelf on Nov. 30. Desjardins spokesperson, Jacques Bouchard, told The Insurance and Investment Journal that the decision was made due to low sales.

"Unfortunately, although we rank second in the market for sales, they have not been as strong as we expected. This has been an industry sales trend. In 2016, it is estimated that life insurance sales were in the range of $2 billion, while total sales of long-term care insurance amounted to about $10 million," revealed Bouchard.

Not related to genetic testing

The sustained low interest rate environment has caused other LTC providers to leave the market in the recent past. However, Bouchard indicated that this factor did not influence Desjardin’s decision.

He also said the new federal Genetic Non-Discrimination Act that came into effect last May did not play a role in Desjardins’s decision either.

The new Act makes it illegal for an insurer or employer to require a person to undergo genetic testing or release the results of previous tests as a requirement to get insurance or any other contract agreement.

Concerns have been raised by the insurance industry that this means a consumer could learn through genetic testing that he is vulnerable to a particular disease and then purchase insurance, such as LTC. This creates a risk for the insurer that actuaries call anti-selection.

Read more on this topic in the January 2018 issue of The Insurance and Investment Journal.