NU Online News Service, Nov. 18, 2003, 1:50 p.m. EST – Rate increases and the exit of some carriers from the market have made the recent past challenging for long-term care insurance agents. But the future for the industry is far from bleak, says Marc Cohen, president, LifePlans, Waltham, Mass.

The recent troubling trends create “a challenge for agents because in some sense, agents are selling this as a product to provide long-term security, and if customers are less certain that as they age they will be able to use the product, it makes it harder to sell,” he says.

There’s also the ongoing challenge of selling to a young person who might not use the product for more than 20 years, Cohen says. The industry has responded to this challenge by selling access to a pool of benefits, rather than just to nursing home care, he says.

“So the issue is not, if you become disabled and need nursing home care; it’s if you become disabled, you can use the benefits in a variety of areas,” he says.

Future trends bode well for the LTC insurance industry, Cohen says.

“The population demographics are working in the industry’s favor,” he says. Also, he notes, “the fact that the federal government has a long-term care program [for federal employees] sends an important message.”

To seize the upcoming opportunities, carriers should simplify their products, Cohen says.

“In an attempt to differentiate themselves, insurers add bells and whistles that add to the price of the policy and are difficult for consumers to evaluate,” he says. “Insurers are going to need to return to simplicity in the product.”