Long Term Care Guild

How has the economy and market downturn changed your approch to selling LTCI?

Comments anyone?

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Here's what Steve Cain of Marsh PCLIS gave as some bullet points during the last phone teleconference last week.

If people are going to self insure, the cost of care is rising, (5-15%) no argument there. And for those that are expecting to self insure, the market left most with declining portfolios (30-60%.) The spread between the cost of care and the money available for it is growing. You won't be able to self insure with this environment.

The current environment we are experiencing now is a preview of a LTC event!

We are culturally conditioned to statements (bank, brokerage, etc) but we don't get one with LTC.

When the client objects to the price of LTCI, ask "What did you think it would cost?"
Elaborate on the "What did you think it would cost?" question. What are you trying to accomplish? To be honest, I ask it, but I'm not really sure why, if that makes any sense!
Simply, when people object to the "high cost of LTCI" they are bulking at a price that they think is unrealistic. If you ask what they think it should cost, then you have a basis upon which to modify the search to fit their expectations. Like any other insurance, they have some set price in their minds on what it should cost. If it is too high, then that's an excuse not to buy, but if you can keep the price within their expectations, you have more control.
I haven't changed my approach. I'm finding more people interested now than last year--and even more than 2007.
No major change in approach for me, YET, but I am finding far more "uninsurables" interested and inquiring than in recent years. Even with enhanced efforts to "pre-qualify," I've found many more people willing to outright falsify / withhold significant medical history to me in order to get an application in to a top rated carrier and take their chances with medical records and underwriting at that level...especially among the higher socio-economic groups. It's generally one impaired spouse rather than two. It's most likely that spouse has been declined in the past or not allowed to apply for that person. I lost over $25,000 in annual commissions the 1st quarter of this year alone to such situations. I realize that underwriting gets tougher in hard markets, but these cases were not even close to being insurable once medical records were examined. These medical conditions were obviously known by the applicants.

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