Establishing the valuable role long-term care insurance (LTCI) can play in safeguarding your clients’ retirement is a great way to start the LTCI conversation.
Once clients understand how LTCI can help them maintain the highest possible quality of life, the path to action becomes much clearer.
That’s not to say that price becomes irrelevant. Clients may still have questions about the price of coverage.
I’ve found that one of the most effective ways of disarming price objections — or preventing them in the first place — is to show clients the enormous potential leverage contained in any long-term care policy.
Emphasizing a policy’s daily benefit tends to distract clients from the much more powerful potential of a long-term care policy. Consider, for example, an agent who describes a policy as offering “a $200 daily benefit for two years with a 3% cost of living adjustment.”
When the benefits are described in that manner, they can be confusing and — even worse — underwhelming. After all, if a client is weighing a several-thousand-dollar annual premium that may be paid for decades, a $200 daily benefit may sound somewhat insignificant.
Long-term care recommendations are much more compelling when the potential benefits are aggregated. For example, the very same policy could be described like this: “We’ve designed a plan so that, if something happens, you’ll have access to $200,000 in five years and more than $400,000 after 15…and it’s all paid out without incurring federal income tax.”
According to the American Association for Long-Term Care Insurance, Westlake Village, Calif., only 27% of applicants are below age 55. I think our industry has an opportunity to do a better job with that segment of the population and, particularly, with those in their late 40s and early 50s.