There are some major misconceptions about long term care insurance that really hinder a broker’s ability to sell the coverage to employers. Understanding the trends in the LTC insurance market can help brokers be prepared to answer questions, dispel the myths and make valuable recommendations for plans that fit an employer’s needs.
This article seeks to help you understand how you can use trend information to guide discussion on LTC insurance with your employer clients.
Misconception: LTC insurance is too expensive for me to cover my employees.
The trend to talk about: Not only are LTC insurance rates affordable, they are also stable. Those are 2 features every employer can agree are important, considering their health insurance rates rise each year unpredictably.
Everyone knows about the cost pressures facing employers today. But employers who wish to remain competitive have to start looking at ways to expand their benefit options. LTC insurance is not a stretch. In fact, an employer could pay as little as $15 a month per employee for a base plan that includes a $2,000 per month benefit as well as professional home care. And LTC insurance premiums, unlike health insurance, aren’t an unknown from year to year. Group LTC insurance rates have changed little since the product’s inception in the 1980s.
Misconception: LTC insurance isn’t something my employees want to spend their benefit dollars on.
The trend to talk about: Employees are becoming more involved in the benefits process, but they still look to their employer to guide them on important benefit decisions. Employers who make LTC insurance a priority will find their employees doing the same. In fact, 92% of cases sold in 2006 by Unum had some level of premium contribution from the employer. It just takes the employer deciding that LTC insurance is important. And it is.
LTC insurance could arguably be one of the most important insurance offerings employers can offer. Consider that long term care costs can range from $33,000 a year for a private room in assisted-living care to $70,000 for a private room in a nursing home. Those rates can drain even a well-planned nest egg in short order.
Think also about the finding from the U.S. Senate Special Committee on Aging that expects LTC costs to double by the year 2025 and nearly quadruple by 2050.
Misconception: My employee population isn’t old enough to be interested in LTC insurance.