Expand & Dominate | Lesson 7

Cross-Selling Long-Term Care Insurance

Part A is your hospital insurance. Part B is your medical insurance. Part C is Medicare Advantage. Part D is Prescription Drug Coverage.

Note how none of those parts of Medicare mention Long-Term Care, or skilled nursing coverage versus nursing home facility coverage?

That’s because Medicare doesn’t cover it.

Our next ancillary product, Long-Term care insurance, or LTCi provides coverage for long-term services and support, including personal and custodial care in a variety of settings, such as your client’s home, a community organization, or other facility.

LTCi reimburses policyholders expenses up to a daily or monthly maximum benefit. This benefit is established at the time of the initial application. Unused benefits remain in the policy allowing the policy to last for a longer period of time.

Long-Term Care covers things like in-home care, home modification, care coordination, adult day care, assisted living, and nursing home care.

These products are flexible, with several different solutions that include traditional stand-alone LTCi with or without riders, Life insurance and LTCi combination versus hybrid products, Annuity and LTCi combination products, or life insurance plus long-term care or chronic illness riders. All of these solutions offer flexibility in plan design and ways to fund the premiums.

Important to note, rates are based on gender with women paying more for Long-Term Care insurance as women tend to live longer than men and file more LTC claims.

And speaking of clients, the majority of people who purchase plans tend to have known someone who required long-term care, and have been exposed to the costs of it.

Because of that exposure, they’re likely more open to purchasing LTCi.

Ideal LTCi buyers are ages 45-70, married couples, people who have financial or estate plans, and women. Women tend to have more influence in the decision-making process as they are more likely to be a caregiver.

Clients who are in reasonably good health will have an easier time passing underwriting for LTCi, so that is something to consider. We always recommend completing a underwriting pre-qualification worksheet to help determine insurability and appropriate underwriting class to quote client.

And then there’s cost. It is important to financially qualify clients to ensure affordability. Clients have a lot of flexibility to create an affordable solution considering the variety of available solutions.

LTCi coverage pairs well with any type of Medicare plan, as it adds benefits that traditional Medicare and Medicare Advantage does not cover.

Selling this product starts with education. As we mentioned earlier, many people mistakenly believe that long-term care will be covered by their Medicare plan.

Medicare only covers medically necessary care, like skilled nursing or rehabilitation, not assistance with daily living.

Start the conversation about this product by making sure your client understands exactly what they can and can’t count on Medicare to provide for them.

From there, as with other ancillary services, ask your client if they or a spouse need “extended” health care what would their plan be? And, how would they pay for it?

Feel free to mention this statistic, too: according to the Department of Health and Human Services, someone turning age 65 today has almost 70 percent chance of needing some type of long-term services and supports in their remaining years.

Those services and supports can cost tens of thousands of dollars per year right now, depending on which type your client needs.

If that doesn’t make your client more open to the discussion, keep this in mind. Planning for things like long-term care and other end of life arrangements can be confusing, it can be overwhelming, and people tend to put it off because they just don’t want to think about it.

But as people age, they tend to place a higher priority on wealth preservation, they have a desire to provide financially for their spouse, their children, even future generations. Most people do want to leave a legacy for their surviving families, and they’re willing to discuss how to plan for that. Reframing the conversation this way can keep the discussion moving forward, even if it doesn’t result in a sale the first time.

As you’re preparing your presentation, don’t forget about all the Long-Term Care solutions that exist.

Asset-based LTCi plans, like hybrid life and annuity combination plans can still give your client paid benefits even if they don’t require LTC coverage. These types of plans can be more expensive than traditional policies, but there’s a savings aspect to them that some of your clients might find appealing.

There are also hybrid annuity and LTCi products or combination life insurance and LTCi products that pair long-term care with benefits from other types of insurance that your clients may be interested in.

These combination or hybrid policies are free from potential rate increases, have a tax-free death benefit, and return of premium options.

Now, if Long-Term Care insurance seems like it has a little bit of a learning curve, don’t let that deter you! It’s easier to understand than it might seem.

Here at Ritter, we’ve partnered with experienced specialists who focus on the Long-Term Care market to bring you powerful resources, training, and top products.

These specialists work with Ritter agents who are interested in selling Long-Term care to assist in running quotes and illustrations, product comparisons, even new business case management! Their staff monitors all cases from start to finish. We can also partner with agents to work directly with clients on your behalf, splitting the commission with you.

And since these products are continuing to evolve with the market, we offer continual training resources! We host live agent training webinars monthly, led by the experts.

Long-Term Care insurance is an extremely valuable cross-sale, for both you and your clients.

We encourage you to take advantage of our resources, add LTCi coverage to your portfolio, and see the results for yourself!

Watch the Next Lesson