As one of Seneca Group’s Financial Advisers both my wife and I each have Enduring Power of Attorneys in place but most people I talk to don’t seem to have a clear understanding of what an Enduring Power of Attorney is and if they do they don’t always understand the compelling reasons they should have one so even fewer have anything in place. Not too long ago I faced a scenario as a Financial Adviser that really drove home to me the importance of making sure others are also aware of its importance as well.
Maybe for many people not familiar with the phrase, it is the words themselves that are the problem – they after all quite legalistic. Having had a look at a Thesaurus I found a way where I can use a quick example that seems to fix that issue though and shine light where it may have been previously murky by using this more ‘plain English’ description with clients.
I find if I replace the word ‘enduring’ with the word ‘ongoing’ and also remove the word ‘Attorney’, replacing it with ‘supporter’, I get a more user friendly phrase - the “Ongoing Power of a Supporter”.
Now we all know what ongoing means, and we know what it means to support. I can then use the phrase without mystery - the Ongoing Power of a Supporter - which describes well the role of someone where someone appoints another to act in their place when they are unable to and that in essence is what an Enduring Power of Attorney is. It allows someone you trust to look after you, and/or your finances or property when you are no longer able to do so for yourself. There are usually two Enduring Power of Attorney’s needed – one in respect of our personal property and the other about our care & welfare.
Why it matters..
I know this really matters because late last year I had a client diagnosed with a very aggressive cancer. They went in for a visit to the hospital on a Friday, but came home on the Monday in a hospital bed. An appointment was made for me to meet with them that Friday but by the time Friday came around they were under the strong influence of morphine to manage the pain and in and out of sleep. They were also in and out of knowing what was going on and processing information.
Luckily I was able to talk to the partner and then I began organising the paperwork for a terminal illness claim, as the prognosis was not good - it was clear where things was heading.
A Terminal Illness Benefit - which most modern day life insurance policies will have - enables the insurance company to pay out on the policy prior to actual death, so concern over money can be set aside at what is already a very stressful time. A Doctor’s written confirmation of the likely death within a specified period (usually 6 or 12 months) is needed to evidence the claim.
The family were very thankful (as they had been unaware of the Terminal Illness Benefit) and they got on with sorting out the arrangements for the funeral but then we struck a snag as the client was no longer easily capable of signing any paperwork as the Policy Owner so the claim could not be submitted without their signature. In the absence of an Enduring Power of Attorney related to her personal property the only alternative left was to wait for her death so the claim could be submitted by the Estate – something that can take a number of weeks (even months) depending on if the person leaves a Will or not.
The pending unexpected death of a loved one is already a very stressful time and the additional worry of finances makes it even worse. In this instance it was not a pleasant situation for all concerned despite there being an insurance policy in place. If only the client & her surviving partner had that piece of paper that appointed the partner as her Enduring Power of Attorney. It would have been all the difference.
As it turned out in this case, prior to her death the client had a short window of time where she was lucid & capable – despite the medication – and she was able to provide her signature on the claim form.
Consequently the Terminal Illness Benefit was paid out and the partner was overwhelmingly thankful and able to cancel the appointment he had made to go cap in hand to the bank for assistance to cover things financially till the claim was settled after his partner’s death.