More Nontraditional Producers Are Selling LTC Insurance

Financial planners and other nontraditional producers will have an increasingly important role to play in the long term care insurance business, says a long term care wholesaler.

CPAs, accountants, securities broker-dealers and banks also are getting involved, giving consumers more options than ever in obtaining coverage, said Steven Cain, director of LTC with Marsh Private Client Services, during a session of the Society of Actuaries’ Intercompany LTCI Conference here last week.

For brokers and independent reps, being able to offer LTC insurance is a way of cementing greater client control, he said. “We tell them if they’re not talking to their clients about long term care insurance, someone else is,” Cain said.

Cain’s Woodland Hills, Calif., company, a division of Marsh Inc., has seen significant growth in LTC insurance sold through such nontraditional channels, he said.

Broker-dealers are getting interested because their clients are asking about it. “They are fearful of harming their client relations because they don’t understand LTC,” Cain said.

Because only about 4% or 5% of the typical broker-dealer’s sales is insurance, they are not at ease with the complicated LTC sales process, he noted. They are more familiar with the quick turnaround of an annuity or mutual fund sale.

That is where the LTC broker comes in.

“You have to transactionalize the sale for the broker-dealer,” Cain said. “It’s still a long process, but you can take them through it step by step, do all the backroom services and support, the fact-finding, getting carrier quotes, and doing the case management.”

For registered reps, Cain offers a chance to earn a share of commissions for sales to clients they already have.