Advisor Today - July/August 2015 - (Page 26)

PRODUCT SPOTLIGHT LONG-TERM-CARE INSURANCE By Debra Newman, CLU, ChFC, LTCP Sell More LTCI By Selling Less! These four "aha!" discoveries can help you see new possibilities in your long-term-care insurance sales. T his will be a good year for the long-term-care industry-if we listen closely to what our clients are telling us and look at what they really need. That sounds simple, but new research makes it clear that we can vastly improve the methods and tools we've relied on for years. We can change direction and reverse the recent shrinking growth rate of lives we insure-a 27 percent drop last year alone. Here are four "aha!" discoveries that can help you see new possibilities, plus one magic word that can lead to winning conversations with your clients. "Aha moments" in long-term-care insurance 1. It's the premium. Your potential clients believe you. They're not waiting for a better policy and they want a solution. Six out of 10 people, however, say they didn't buy because the premiums were too high. And maybe they're right. A new Genworth study shows that the average claimant will spend just 67 percent of his monthly benefit. Maybe, we've been overselling? Consider insuring a more moderate risk. Numerous studies show that consumers will buy coverage if it meets their price points-generally monthly premiums of about $75 for people in their 40s, $100 in their 50s, and $150 for those 59-65 years old. And no need to duck client concerns about premium increases in recent years. Most will understand that the unexpected "success" of people living longer and holding their policies longer, combined with low interest rates, required that insurers deepen reserves to protect policy-holders. New policies now reflect that reality. 26 ADVISOR TODAY | July/August 2015 A policy that brings in needed help can ease that burden and become a gift of love to family members. 2. The group market offers incredible pricing. Federal law prohibits group policies from gender-based pricing. Females will pay substantially lower premiums through a worksite offering if they are the employees or even the spouses of employees. 3. Gender-based pricing benefits men, especially gay couples. A gay couple could pay about $1,400 a year less than a heterosexual couple. That could dramatically expand your market. 4. You can design plans that better meet client needs. Only 31 percent of long-term care is done in nursing homes, 18 percent in assisted living-and a whopping 51 percent where your clients most want to stay-in the comfort of their own homes. So you should show them: * A policy that fits their financial comfort level. Instead of offering a $6,000 "nursing home" benefit with lots of bells and whistles, avoid sticker shock with a more modest policy based on lower home-care costs, a three-year benefit and an option to kick up inflation protection later. The flexibility for pricing is in the inflation choices. Remember that if you are helping clients in their 50s, you can continue to review and adjust benefits later in life. * A policy providing help where they likely will use it. Yes, it will help them in nursing homes, but most important, it offers them help at home and provides relief for their families. * How it offers protection for those they care the most about. Family caregivers often grow exhausted. How did it go for their parents? Their grandparents? Many caregivers become ill and some even die from the stress. But a policy that brings in needed help can ease that burden and become a gift of love to family members. The magic word Here you have it: "permission." Nobody minds spending insurance benefits. We are creating a plan now while we are all healthy, and we are giving permission to each other to hire help when the time comes so that we do not destroy the health of the people we care about the most! More cause for optimism Look around you. About half of the producers who were once selling LTCI policies have left the market, which leaves you with more potential clients. Opportunities will grow as we listen to our clients. We just need to embrace new ways of solving their problems. Consider that half of the people who retire earlier than planned do so because of health problems or disability, and another 25 percent do so to care for a family member. These are the very people your policies are designed to protect. People still need your guidance. Deb Newman, CLU, ChFC, LTCP, is the founder and CEO of Newman Long Term Care, an agency focused on LTC insurance for 25 years. She is the past chair of Life Happens, and was an adjunct professor for the new Retirement Income Certified Professional designation from the American College. Contact her at

Table of Contents for the Digital Edition of Advisor Today - July/August 2015

From The Editor
New Products
How Do You Create the Million-Dollar-Plus Practice?
Traits of Top Performers
The Business Benefits of a Pipeline Mentality
What Does It Mean to Act Ethically?
Variable Universal Life is Back
Sell More LTCI By Selling Less!
Overcoming the Most Common DI Objections
Divorce DI
Mitigating Retirement Risks with Life Insurance
Creating Irreplaceable Capital
Closing the Gap
Financial Future Less than Rosy for Boomers and GenX
Estate Planning and Annuities?
Ignite Your Sales Potential
A Closer Look at BTID
Upholding the Tradition
NAIFA’s Candidates for Election
Addicted to Rejection
What is Keeping Your Senior Clients Up At Night?
Advertiser Index
Back Page

Advisor Today - July/August 2015