Layers, part 2

Jesse Slome has been talking at events and interviews about coming up with a new paradigm for long-term care insurance (LTCi) and long-term care (LTC) planning.

Last week, we published the first part of a presentation he gave recently at the National LTC Insurance Summit. There, he talked about the need to move to a New & Improved LTCI strategy.

Here, he talks about what that strategy might look like.

Welcome to the world of New & Improved Long-Term Care Insurance.

In the old world, the world of the Hummer, we used a “one and done” approach. Now we have to move toward a more flexible, layered approach that might start when consumers are in their 40s or 50s and evolve over the years.

Let me compare “old think” ideas with “new think” ideas.

Old think: Inflation protection is mandatory.

Okay, I can feel the hairs on the back of many of your necks rising. I’m touching the third rail of LTCi: Inflation protection.

Inflation protection was always an option. It certainly served a purpose and provided a value. But it was … and is … an option for those who can and will pay for it. It just was not sold that way.

New think: Some coverage, even if it doesn’t grow, is always going to be better than no coverage.

People understand that some money saved in a 401(k) is always better than no money in a 401(k). People understand that some health insurance, even if that means having a high deductible, is always better than no health insurance.

People always find ways to manage their benefits. In the new economy, we are all getting even better at managing our benefits.

Long-term care insurance is no different.

If doubt still lingers: Ask any claims department person, and they’ll tell you that no beneficiary or family member ever complains about getting $100 towards the cost of care, even if the cost of care is $200. Some agents call it a $100 coupon towards the cost of care.