Advisor Today - November/December 2015 - (Page 25)

product spotlight LONG-TERM-CARE INSURANCE By Doug Jolley Starting the LTCI Conversation A good first step is to make your client feel empowered instead of uncomfortable. Y our clients trust you to help them with their retirement. Are you failing that trust in an area that could potentially have the greatest impact on their retirement? Clients primarily have two concerns: not having enough money to continue their lifestyle when they retire, and outliving their money. A part of addressing these concerns is getting them to talk about the need to plan for their long-term care (LTC). And that is a difficult task. They don't want to talk about the uncomfortable subject of needing help with things like continence, bathing and dressing. As a result, many agents give up because it is so difficult. This results in agents leaving their clients vulnerable and exposed to one of the greatest threats to a successful retirement plan-no plan to deal with their long-term-care needs. This problem is summed up simply by Deb Newman, a leading LTC expert: "There are not enough conversations going on about longterm care." Starting the conversation So how do you successfully address the subject and provide meaningful solutions? One way is to make your client feel empowered instead of uncomfortable while dealing with the issue. Newman suggests shifting the conversation by using the word "permission." She says some advisors frequently tell their clients that they can self-insure because they have lots of money. But when care is needed, she adds, their spouses or kids are reluctant to use cash to spend on care, and the family starts providing care. But caregiving usually takes a toll on the family. So your conversation with your client should go something like this: "By having LTCI, you are giving your family permission today, while you're still healthy, to hire someone to care for you if and when the time comes cases if they have some form of LTCI coverage. Also, let your clients know that some coverage is better than none. According to surveys, many clients have a "comfort point"-frequently between $100 and $200 a month- that they are willing to spend on LTCI. While the coverage that amount buys may not cover all their costs, it may keep them from being a burden on their families or being forced out of their own home for care. Another area of empowerment I try to give my clients is the ability to stay in control of their care. when you need care, so they don't have to be your constant caregivers. You can tell them, "I give you permission. It's why I purchased LTCI." Telling a story is also helpful. In our family, I discussed LTC with both sets of parents. My father and stepmother purchased an LTCI policy from me, while my fatherin-law declined. At the time of his death, my father-in-law was paying $6,000 a month for home care for him and his wife. My wife and I then decided to care for her mother in our home, which ended up being the last six years of her life. Mom suffered from Alzheimer's, and could not walk, talk or feed herself. It was an act of love, but it took a toll on my wife, the primary caregiver. Shortly after my mother-inlaw passed away, my mother also needed care, and she had not been eligible for LTCI. Due to her greater medical needs, we were not able to care for her in our home; so, my mother miserably spent her last four years in a nursing home. What we experienced with my mother reinforced another area of empowerment that I always try to give my clients-the ability to stay in control of their care, preferably in their own home if at all possible. And that is only possible in most New options Agents have a number of protection options these days to present to their clients, including life and annuity products that offer coverage, in addition to traditional LTCI policies. Aaron Eisenach, another LTC expert, says, "We have more product types than ever before, allowing us to help people of any income and asset levels and health status." However, he believes that there is still a clear winner in providing that coverage: "Stand-alone LTC policies still provide the most bang-for-the-buck, compared to other solutions. A client could pay a few months' or years' worth of premiums, suffer a change in health, and hundreds of thousands of dollars are available for care needs. LTC insurance also provides the most attractive inflation protection, shared benefits between couples, asset protection in most states through the Partnership program, and the widest range of options to structure a small, medium or large policy." Start having this important conversation with your clients today and help them address a key area of concern. Doug Jolley is the founder of Southern Health and Retirement Planning in South Carolina, with offices in Columbia, Charleston, Myrtle Beach and Hilton Head. He can be reached at 803-318-3684, or via email at November/December 2015 | ADVISOR TODAY 25

Table of Contents for the Digital Edition of Advisor Today - November/December 2015

From the Editor
New Products
In Step with a Winner
Finding Success in the Chinese-American Market
Dealing with Client Confidentiality
Hashtag Your Way to Social Media Relevance
Starting the LTCI Conversation
From Term to Perm
Protecting the Downside with Allocation Adjustment
Jules Gaudreau: A NAIFA Success Story
Helping Clients Cope with Market Volatility
NAIFA Government Relations
Working with Single Women
Financial Planning FAQs of Small-Business Owners
Three Retirement Conversations to Have with Clients Today
The Advent of Robo-Advisors
Moving into the Retirement Space with 401(k) and 403(b) Plans
Moving the Sales Process Forward
Cultivating the African American Market
The Lighter Side of LIfe
Advertiser Index
Back Page

Advisor Today - November/December 2015