How to Up Your LTCi Sales Game

Three-quarters of Americans don’t currently have long-term care insurance—and nearly half of those with an annual household income of $75,000 or more say that’s because it’s too expensive, according to a recent survey conducted by Harris Poll on behalf of OneAmerica.

Other reasons for not purchasing LTCi include “I don’t want to pay for something I may never need” (25%), “I’ve never heard of it” (13%), “I’ve heard negative things about it” (9%) and “I don’t know how to get it” (9%).

“There’s a great need for education out there,” says Chris Coudret, vice president and chief distribution officer at OneAmerica, who notes that many people’s perceptions of LTCi are based on traditional types of coverage rather than the newer, hybrid types of policies his company provides. “People aren’t aware of the need because they’re not having the conversations with people they trust for financial advice. Where are they supposed to find these things out?”

Ouch—that means you. “Some advisers have perhaps tried to have the conversation, but they just laid out a lot of stats and made it a whole risk-based conversation, and they might have called it ‘nursing home insurance,’” Coudret says. “If I’m the client, I’m thinking, ‘Well, I don’t want to go to a nursing home—that’s not me, I’m not in that group. I don’t need that kind of insurance.’”

How do you make a coverage seem relevant to a client when the need doesn’t exist yet? Start by asking clients and prospects who are in their 50s or older to list out their anticipated expenses during retirement, Coudret suggests—mortgage, rent, food, clothing, transportation, health care, travel, entertainment and more.

Then, ask how they’re planning to pay for all of it. “You’re not working anymore, so it’s a simple process of planning. They probably have savings and other assets, Social Security, their 401(k)—those are all providing income,” Coudret says. “They look at all those things and think, ‘I’ve got money, I’m OK.’”

But if they’ve overlooked an expense as significant as LTC, they could be making a big financial mistake. If a prospect must incorporate this type of care into their budget and they haven’t planned for it, “what are they going to have to give up because of that? That’s a significant gap that needs to be addressed,” Coudret explains. “LTCi can help provide the income they need to cover that expense.”

And for prospects who don’t plan their incomes in a way that enables them to take ownership of their care during old age, “you lose control by not having your own way to pay for it,” Coudret adds. “You want your loved ones to be able to supervise that care, not provide it, if that can be avoided.”

Changing the conversation can help you do a better job positioning LTCi as a cost-effective way to manage risk. “This isn’t entirely a consumer issue,” Coudret says. “You can’t blame them for not knowing what they don’t know. The story’s just not being told enough.”

Jacquelyn Connelly is IA senior editor.