Time to Shake the Trees

Property-casualty insurance is in the doghouse because the world has gone kablooie. If a fire, an earthquake, a nuclear disaster or mold doesn't get whatever the insurer has been insuring, chances are hackers or solar flares will do it in, any way.

Backing annuity guarantees is in the doghouse because the issuing life insurer could lose money on its investments.

LTCI is in the doghouse because the issuing insurer may have a hard time making much money on its investments, given how low interest rates are, and because it turns out that, 20 years ago, actuaries, or the product designers who made use of the actuaries' work, turned out to be too pessimistic about how much consumers would cling to their LTCI policies, and somewhat too optimistic about how likely the insureds were to avoid using nursing home care or home care.

But Slome, AALTCI and the long-term care insurers and distributors that support AALTCI are trying desperately to free the industry from the maze for reasons of self-interest, because they know they're needed. Members of the Silent Generation are about to join the ranks of the old old, and a few of the oldest, unluckiest baby boomers are already starting to need help with activities of daily living.

"Almost everyone who buys [LTCI] has had someone in their family who needed care," Slome said in an interview.

Now , Slome said, some boomers are starting to learn from their parents' experience, or their own experience, about the importance of long-term are (LTC) planning and LTCI, but someone has to try to reach the boomers who have not yet had personal experience with LTC and warn them about what's coming.

If the boomers take too long to learn why they need LTCI, they may develop health problems that will make it next to impossible for them to actually buy coverage, Slome said.

"You have some very dedicated distributors who focus almost exclusively on long-term care products," Slome said.

Slome expects to see more carriers come out with new life and annuity products with LTC benefits features.

"Sales are going to be up," he predicted.

But, despite what to the insurers, wholesalers and producers is an obvious, huge need for LTCI, "it's a slow-growth marketplace," Slome said. "There is no more low-hanging fruit. If you're going to be in this business, you'd better get a ladder."

AALTCI plans to hold its next LTCI producers summit in November in Las Vegas, and there Slome expects programming to focus on two ideas: Strategies for reaching people who have not yet had a personal LTC experience, and strategies for reaching prospects over the Internet and over the telephone.

In the past, LTCI producers were everywhere, and they often met in-person, one-on-one, with prospective customers.

Today, Slome said, LTCI producers are covering a broader territory and relying on technology to extend their reach. One carrier has tod him that it gets about one-third of its LTCI sales from Internet sales and telephone sales.

Slome said he is hoping the conference programming can help keep the LTCI market viable by encouraging 500 to 600 agents to stay in it.

AALTCI also is organizing a conference aimed at representatives from the carriers, field marketing organizations and brokerage general agencies in the Medicare supplement (Medigap) insurance market. Medicare Advantage events are common, but Medigap-only events are rare, and the people in that industry are hungry for opportunities to network, Slome said.