Agents who are trying to sell long-term care (LTC) products and services to consumers should file away the scary statistics and work harder at developing heart-tugging stories.
Pincus, who has a doctorate in social psychology and once worked as director of research and product development at John Hancock Financial Services, gave an updated version of how he thinks behavioral economics research findings apply to LTCI sales.
See also: Selling LTCI smarter: Prospect theory
Many insurers and government officials have assumed that consumers have been slow to buy LTCI because of a lack of awareness of LTC costs and LTCI products, Pincus said.
The LTCI community has responded with efforts to make consumers aware of how much LTC services cost and how they can use LTCI to pay the bills, Pincus added.
“The dirty secret is that education levels have gone up,” he said. “And we’ve seen a decrease in sales. I think the answer is: Don’t educate at all.”
One famous behavioral economics study found handing out a flyer about the tragedy facing Rokia, one desperately poor 7-year-old girl from Mali, brought in twice as much in contributions as giving similar potential donors a flyer telling them that 3 million people in Africa were facing starvation due to a drought and flooding.
A flyer providing both the story about Rokia and the statistics was about as ineffective as the flyer that simply gave the statistics.
The lesson is that “statistics destroy empathy,” Pincus said.
From the perspective of behavioral economics research, the best approach is to tell LTCI prospects positive stories about how LTCI can help them keep doing things they love, such as gardening or going to Broadway shows, rather than focusing either on statistics or depressing stories about the need for care, Pincus said.
See also: Nobel goes to health care economist
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