Long-term care insurance can and should be sold in much larger numbers than the current rate, said Phyllis Shelton, president of LTC Consultants, Nashville. She spoke here last week at LIMRA International’s annual meeting.
“Other product” jealousy is partly to blame for anemic sales, she said. Many agents assume that selling a long-term care policy means losing a life insurance sale.
“That’s not true,” Shelton said. In fact, she calls LTC coverage “a door-opener.”
Also contributing to low sales figures is lack of comprehensive agent training. Failure to sell inflation coverage is a sure sign that an agent has received inadequate training, Shelton said. Without inflation protection, a policyholder will receive coverage at the rate services and products were selling when the policy was purchased. In just a few years, lack of inflation protection can significantly decrease the value of the policy, she said. A person purchasing LTCI from her never leaves without inflation coverage, Shelton said.
Another sign of poor training is when an agent sells coverage for room and board and not the other charges involved in a nursing home stay that can be up to 20% of the total charge, Shelton said. The consumer should know what the out-of-pocket expenses will be for a nursing home stay, Shelton said.
The “quagmire” of compliance rules is another deterrent to selling LTCI, Shelton said. An organization using one of Shelton’s brochures for selling LTCI continues to use the 1998 version, even though it has been updated every year since. Shelton said the organization would like to update along with her, but can’t because it takes too long to get approval from the local compliance department.
Not teaching agents how to network with long-term care insurance providers and other professionals is also a mistake organizations make that result in sales that are far less than what they could be, Shelton said.
The way LTCI is marketed can also have a negative impact on sales, according to Shelton. Marketing is usually directed to people ages 50 and older. She said a person with a remote control in his hand who comes across a commercial of an elderly person with a walker going into a nursing home will not hesitate long before changing the channel.