LIMRA On Increasing LTC Sales
LIMRAs summer 2001 quarterly report outlines factors that could bolster and hinder the insurance industrys attempts to increase its long-term care insurance market penetration, which currently tracks at less than 10%.
Potential boosters are:
–Better information on how policies are performing for claimants. According to LIMRA, recent surveys show that benefits fall short due to inadequate inflation coverage, reduced home health benefits and an inadequate daily/monthly benefit because the benefit consultation doesnt consider that nursing homes cost an average 20% above room and board for drugs and supplies.
–Attention to the LTCI market from estate planners and group benefit specialists.
–New Medicare prospective payment rules for home health care that provide an incentive to do fewer visits and teach family members to provide care.
–A new credit against mortgage insurance premium when a reverse mortgage is obtained to fund LTC insurance premium.
–New estate recovery legislation that says “undue hardship” wont be granted to people who have transferred their assets to qualify for Medicaid.
Potential hindrances are:
–Lack of comprehensive agent training; the norm is two to four hours of product training, LIMRA says.
–Not putting equal advertising dollars behind LTCI as other products. Companies need a “Got LTCI?” campaign, LIMRA says.
–Defining LTCI as appropriate for a narrow band of clients (i.e., with assets from $50,000 to $1 million).
–Positioning LTCI primarily for seniors, which means ignoring the marketing opportunity of executive carveout and voluntary plans.
–Not treating LTCI as a core product, thereby not treating it equally for agent trips and bonuses.
Reproduced from National Underwriter Life & Health/Financial Services Edition, August 27, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.