Parents Are A Powerful Motivator For Boomers Own LTC Buy
Agents who have had success in the long term care insurance market say convincing boomers to think about LTCI is a matter of finding the right prospects, hammering home the idea that health care can consume huge amounts of retirement cash and tactfully reminding people of their own morbidity.
Ron Brie, a producer with LTC Financial Partners, gets many of his sales through referrals from the parents of boomers. Brie also gets referrals from attorneys and CPAs, he says, but “the most powerful suggestion comes from parents.”
After more than 10 years in the business, most of his original prospects are now in their 80s, he points out.
“I now have 1,100 active clients, and whenever I speak to a client I ask them about their children,” he says.
Jack Stayer, president of Northern States Brokerage Inc., says a strong belief in LTC helps convince clients they need it.
Stayer has been a believer since he and his wife both saw their fathers become the main caregiver for their mothers late in life.
“My wife and I agreed we were not going to let that happen to us,” he says.
A few years after taking out a policy, Stayer began selling LTC himself.
“Ive been preaching that the market [for LTCI] was boomers,” Stayer says. “People looked at me peculiarly because the big market was supposed to be people 72 years old or older.”
But boomers, if they havent found out already, soon realize through their own parents experience that LTCI is necessary to protect their families from the risk of having to take care of them for many years, Stayer argues.
If the client balks at price, Stayer points out its cheaper to buy sooner than later. He uses a computer program to help clients look at how much it would cost them to wait.
“I point out that if you wait 10 years, you may have to pay practically double what you would pay now,” he says.
Stayer also strives to convince boomers that LTC is a social responsibility, not just a practical necessity.
“If you think we have problems with Medicare, Medicaid and Social Security now, look at the population thats putting a strain on those entitlements,” Stayer tells his clients. “That size is nothing compared to what it will be like in a few years when our 80 million boomer friends are tapping into the system.
“In Wisconsin, 70% of the people in nursing homes are there on Medicaid,” Stayer adds. “Whats that going to look like if my generation decided to accept that kind of care? Well sink the ship.”
Another key to selling LTCI to boomers is recognizing that not all will be immediate prospects, advises Walter J. Robinson, director of LTC sales at Booth Financial Associates, Norwalk, Conn.
“If they are still at a stage in their life where they have tuition payments or wedding plans to take care of, it becomes difficult for them to buy long term care,” he observes. “But once family obligations are behind them, usually when theyre in their mid to late 50s, its a terrific time to buy.”
If the client balks, Robinson asks them to think of people they know who didnt have the insurance when they needed it.
Chuck Eberle, president, American Insurnet Agency, Cincinnati, says its vital for agents to understand each long term care insurance product they sell, so they can help clients comprehend it.
Eberle generally tries to position LTCI in one of two ways: as a capital transfer tactic for boomers who own their own businesses; or as the final piece in a clients existing benefit portfolio.
Health care insurance wont be there in their senior years, Eberle points out, while disability insurance only takes care of normal daily expenses. And the retirement part of a clients benefits portfolio would be in serious jeopardy without long term care.
“A lot of boomers buy LTCI to cover their parents,” he adds. “They know that if their parents need care for even 5 years, there goes their inheritance.”
Once they see that point, it eventually leads them to see the need for LTCI not just for their parents but for themselves as well, Eberle says.
Reproduced from National Underwriter Life & Health/Financial Services Edition, February 20, 2004. Copyright 2004 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.