You’ve been referred to a couple as prospective long term care insurance buyers, and because of family experience, they are highly motivated to buy policies. As you speak to the clients over the phone, you discover that one spouse was diagnosed with diabetes more than 10 years ago. How you handle it from here will go a long way toward determining whether you get the policies approved or even place them.
No one wants to enter into an exercise in futility by submitting applications to a company that won’t even consider your applicant. Just as important, it’s crucial that agents who are presenting LTCI understand they often become the face of the industry for many prospective applicants. Handling the presentation and applications with sensitivity and care can result in a win/win for you and the client and enhance the overall image of LTCI.
Conduct good field underwriting
If you do an awesome underwriting job up front while addressing the client’s insurance goals, you’ll improve your chances that they will happily provide referrals to friends and family. Worst-case scenario, if you discover the client is uninsurable with all insurance companies, you can provide an invaluable service by offering resources about alternate strategies. This might include an attorney or financial planner experienced in elder law or long term care planning.
Know your carriers’ standards
Long term care insurance companies can differ quite a bit in how offers are made. Some insurers will only evaluate an application on an “accept or decline” basis, while others add a preferred or good health discount as a third category. Still others can make offers that are in higher premium or substandard rate classes. What could be a substandard offer with one company might be standard or even a decline with another, depending on the final evaluation by the insurance company; by the same token, what could be standard or select with one company could be preferred with another. You can save your clients (and yourself) a lot of money and aggravation by doing your homework.
Manage challenges up front
If you become aware of some challenging medical history, you should be prepared to sensitively discuss this with clients. Since few of us are medical experts, you may need to research which questions you should ask in order to get as full a picture as possible of your client’s situation. If you find yourself with limited opportunities to research these questions in advance, you might consider asking the following:
- What was the date of diagnosis?
- What kinds of treatment resulted?
- What was the prognosis?
- Are they still receiving treatment?
- When was the treatment completed?
You also need to know about any related or unrelated recent prescription drug history and current height and weight. Details matter, so keep digging for a full picture of the health history.
Use your resources
After the medical interview, call the hotlines of the insurance companies under consideration, particularly if your client’s answers aren’t as clear as you would like. A good phone representative should be able to suggest a tentative offer or range of possibilities. These individuals can also suggest other questions for you to ask the client that will help narrow down a possible opinion.
A helpful tool is a subscription to www.mycltcassistant.com. This Web-based service offers useful resources for you to research medical histories, prescription drug use, and possible underwriting outcomes from some long term care insurance companies. The site also offers accessible PDFs of the insurance company’s underwriting guidebooks, as well as hotline phone numbers.
One word of caution, however: You must recognize — and be careful to convey to a client when you are discussing this information with them — that these opinions are only preliminary and cannot be finalized until a full application has been reviewed. Any additional requirements must be satisfied before a firm offer can be made.
Evaluate your options
While most of us have favorite insurance companies we work with, your first or second choice might not be the best choice. Research will help you remove carriers that may not offer coverage because of a particular health condition. The result is you will be able to submit an application with confidence.
Remember: To do right by your LTCI prospect, you’ll most often achieve the best outcome for your client and yourself by paying attention to details. Obtaining the best result for your client might not always be your first or second choice, but it could be the best choice.
Stuart H. Armstrong is a John Hancock Life Insurance Company agent with Centinel Financial Group. He can be reached at 617-424-0005 or [email protected].