Many consumers live in the short term, even considering interest rates a short-term event and using credit cards to pay for everything from their daily latte to vacations and household expenses. Resolutions to save and some important financial decisions are often put off.
These mounting credit card expenses may have an impact on a consumer’s long-term financial goals. According to the Federal Reserve Board, consumer debt hit $2.2 trillion in 2005, up from $1.8 trillion four years earlier. This figure represents credit card and car loan debt but excludes mortgages.
The long term care challenge
As agents, we’re faced with a continuing challenge: How can we sell long term care insurance in a short-term world?
As in most sales, the more you can tailor coverage to address customers’ personal needs, the more they will be satisfied with coverage–maybe even willing to pay more for the options they want. To bring about this awareness, we as agents must commit ourselves to homework, problem-solving and learning how to enhance base policies with riders.
In its most basic form, long term care can be considered an ever-changing array of services aimed at helping people cope with limitations in their ability to live independently as they age. As more service options become available, the more we need to adjust the way we sell.
During the past 20 years, we’ve seen companies enter (and exit) the business, partly because they may not have understood fully such issues as product pricing, lapse rates and the sales cycle. According to a 2004 America’s Health Insurance Plans report, in 2002 only 104 insurers were selling LTC insurance in the U.S., down from 127 in 2001, the smallest number the researchers recorded since 1987, when the market just was beginning.
This rough beginning may mean we, as an industry, have failed to connect with real solutions for our customers. The rest of the responsibility may be human nature.
Fortunately, we have ways to customize policies–both to offer more appropriate coverage and to address the issues customers most care about. Companies have made an enduring commitment to educate their agents, and the industry has established accredited certification courses.