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The Situation

Your client understands the need for Long-Term Care Insurance (LTCi), but feels the premium is too costly – they want the policy, but can’t afford the premium.

The Sales Solution

With all the options available on LTCi products, you can help your client “dial down” the premium to fit their budget.  After all, some Long-Term Care Insurance is better than none.

You can dial down premium in a number of ways:

• Adjust the inflation protection option.
• Reduce the monthly benefit amount.
• Reduce the maximum monthly benefit amount for assisted living.
• Adjust the benefit period.
• Adjust the elimination period.

Here’s how it works:

• If you’re making a partnership qualified sale, the inflation protection option must meet state requirements based on the client’s age at application.  In this case, you may not be able to adjust the inflation protection option and may have to adjust the monthly benefit amount instead in order to reduce the premium.
• If inflation protection is not a factor, look at using an inflation protection option other than 5% lifetime.  You might consider the 5% 20-year option, which provides a compounding benefit increase for the first 20 years of the policy.  You also could use a 3% or 4% lifetime option or the 5% simple option.
• If your client feels they may not need the maximum monthly benefit for assisted living facility, they have the option to reduce that benefit by as much as 50%.
• You also can help the client select from seven different benefit periods and six different elimination periods to help reduce the cost of the policy.

Your Competitive Advantage

Having the ability to show your client various benefit combinations allows you to tailor a policy that meets their needs while staying within their budget.  And that gives you a competitive advantage in the LTCi marketplace.

For more information contact your LTC Specialist today.

Why is it that the most important item on an insurance application is allocated so little space?  Why is it that the second most important item gets equally parsimonious treatment?

All that other stuff is necessary from either a practical or a legal standpoint, but when the dust of policy issue and underwriting have settled and the contract is in force, all that really matters going forward is who owns the policy while the insured is alive and who will get the dough when he or she dies.

Now, having so simply acknowledged this truth – look at the room given on most applications to set down in writing the intentions of the applicant.

The dangerous psychology of the inadequately small boxes is that they seem to suggest that if more room is needed then a client, or an agent or advisor making recommendations, must be excessive at best and obsessive at worst.

The little boxes encourage short, compulsive answers that seem workable at the time, but that could result in disaster if not later re-addressed and cleaned up.

Real-life case in point:

The business owner/proposed insured needs coverage for anticipated estate tax liability (we’re talking several million in coverage).  Time is of the essence because the clock is running on a good underwriting offer.  Everyone is so busy (and hey, who isn’t?) that the advisors and clients can’t get together to talk through the proper structuring the policy.

Finally, the day before the offer will be withdrawn, word comes that for now the policy should be owned by the company (heck, why not, it will be paying the premiums), and the beneficiary will be the insured’s wife.  The first of only two items of good news is that, at least, there is coverage in force.  The other is that the designations commanded are so short that they fit nicely into the boxes on the application.

Other than that there are several potential problems:

• An “unholy triangle” had been created.  The owner, insured and beneficiary are different parties.  Payment of the death benefit to the spouse could create an income taxable event.  Depending on the manner in which the company was taxed and some other factors this may not be a problem, but nobody took time to think it through.
• The joint taxable estate of the insured and his wife stands to increase by the amount of the benefit at his death.  Policies purchased to help with estate taxes are held by third parties – usually irrevocable trust whose beneficiaries the same as the insured’s heirs.  This takes planning during the underwriting stages of case.
• No instructions are given regarding who should be the beneficiary if the wife dies first (maybe it is just as well given that there was no more room in the beneficiary box on the application).  Depending on the contract language the default beneficiary could be either the owner, or the estate of the insured if they are the same.  So now the millions could go into probate court where they are subjected to the expense delay and publicity that attends that process.

Accept three good rules to live by:

• Be prepared to submit ownership and beneficiary instructions on a separate sheet of paper that is referred to in and is a part of the application.
• Always submit complete descriptions that include contingent owners and beneficiaries where the primary parties are natural persons.
• Ask us for help – we will assist as you draft thorough instructions for designation of primary and contingent parties to a policy and will, when necessary, get the blessing of the claims department of the carrier involved.

It always works better when you think outside the box.

• Life Insurance for Family Needs
• Life Insurance for Business Needs
• Buy/Sell Planning Fact Finder
• Estate Planning Analysis
• Estate Liquidity Fact Finder
• Retirement Planning Needs Analysis

While not every question or category will pertain to any given client, the depth of the fact finding analysis forces both agent and client to consider all potential items that may have relevance to their financial situation.  At the end of the process, clients feel a sense of ownership in the process as the assumptions are based on information they provided.

Make sure you’re prepared to help steer your clients through this vitally important process.

Contact your Life Sales Rep to learn more about our fact finding tools and how we can help you zero in on the true need for each of your clients.

Diabetes, there’s no way to candy-coat it – this all too common yet serious disease can present some challenges in life underwriting.

An estimated 1.7 million Americans are diagnosed with diabetes each year.  Complications can include heart attack, stroke, cardiovascular and kidney diseases.

The good news is diabetes can be well managed with proper diet, exercise and medication and in turn helps to reduce the chances of developing complications.

There are several factors that underwriters look at when reviewing diabetes cases

These include the type of diabetes (Type 1 or Type 2), the current age of the client, age at time of diagnosis, A1c levels (average blood sugar), treatment and any diabetic complications.  Type 2 diabetes is the more common form in which the body is resistant to insulin.  Ratings are generally more favorable for Type 2 than they are for Type 1.

Some top carriers have programs that could be the icing on the cake to getting the best possible offers for your diabetic clients.

Take a look at these examples:

• Type 2 Diabetes: 75 year old male non smoker, diagnosed with 10 years ago, A1c levels have averaged 7.0 or better, 5’10 207 lbs, blood pressure is 143/90 and cholesterol is 270 with a cholesterol ratio of 6.0 – PREFERRED rating!

• Type 2 Diabetes: Age 50 and older with excellent diabetic control, treated with diet and oral medication only, no complications – STANDARD PLUS is possible!

• Type 1 Diabetes: Over age 50 with excellent control and no complications – TABLE B is possible!

Our Underwriting Team is ready to help get you the sweet deals you need in order to get your impaired risk cases placed – contact us today.

Women often try to find the right balance between juggling careers, spending time with family, and caring for loved ones.

With women living longer, and providing more caregiver services, they become more vulnerable to long-term care issues.

Now is the perfect time to increase your focus on existing and potential female prospects to expand your LTC Insurance business.

How You Can Help:

Women may spend their entire lives taking care of other people.  You can help them create strategies to plan for their future and help protect their retirement assets.  An LTC Insurance policy can help protect their assets and help them maintain independence in the future.

To increase your reach and help your female clients take the first step to long-term care planning, consider these scenarios:

• Married Couples:  Husbands often need care first, leaving less assets for the wife to use for her own care.  Review your clients’ long-term goals to ensure both parties have a care plan for the future.
• Same-Sex Couples:  Current financial planning rules can make it tricky to access a partner’s assets when care is needed.  Help your clients design a plan to share each other’s benefit dollars.
• Widowed/Divorced:  When a woman becomes divorced or widowed and has no children, there may be no one to take care of her.  Almost 70% of women age 75 or older are widowed, divorced, or never married, compared to only about 30% of men.  Explain to your female prospects the value of Long-Term Care planning and how a policy can help them protect their future.
• Adult Children of Aging Parents:  In helping adult children with their own LTC planning, they can purchase coverage and have access to our Caregiver Support Services Benefit, which is a great source for advice and helpful information should a long-term care event arise for an uninsured family member, especially Mom.

Reasons to Plan:

• 60% of LTC Insurance policies are issued to women, indicating that women are acknowledging the need for care.
• 80.6 years is the current life expectancy for women.  The current life expectancy is 75.2 years for men.
• Over 1 million women are in nursing homes; versus only 400,000 men.

Expand Your Target Market

Look for local women’s organizations in your area and consider hosting an LTC planning seminar to educate women on the risk of not having a plan and the comfort of having one.

Contact Us

Our expert team can offer advice on discussing Long-Term Care with women and how to approach their concerns. Contact us today to learn more.

Let’s suppose you are the primary provider for your family, which depends completely on your income to support all of its household needs.

Consider this:

Recently, you’ve been hunting for a better job and now there are two offers on the table:

• Your first offer comes from an employer who will pay you $100,000 a year, but you must personally assume the risk associated with suffering a disabling injury or illness.  If, at age 35, you get sick or hurt, your lost earnings could amount to as much as $5.2 million dollars assuming only 3% annual increases over your working career.
• The second offer comes from a different company that will pay you $98,000 a year salary and provide a guaranteed income benefit of $65,000 annually in the event you suffer a long-term injury or illness that prevents you from working.  If you become disabled at age 35 and are unable to return to work, those benefits could equal as much as $2.2 million.

The Council for Disability Awareness statistics show 1 in 4 of today’s 22 year-olds will become disabled before they retire and that the average long term disability work absence is 2 ½ years.

Now you are aware of the disability statistics, I am certain you recognize the value the second employer’s offer, and would accept, and are glad to have the choice to have the protection for you and your family.

Our job as advisors:

• Help educate our customers about the risks associated with being sick or hurt and unable to go to work.
• Give our customers a chance to vote on whether they would like to hand off that risk to an insurance company.

Over 100 million working Americans don’t have private disability coverage and I suspect most of them have never been given a chance to vote.  Help your clients make the right decision.

Contact your Disability Income Insurance Specialist today for more information on these types of Disability Income Insurance scenarios and more.

A simple coin toss is the most popular form of settling disputes or making decisions.  Subterfuge is often used to improve a participant’s odds.  If the caller sees through the “heads-I-win/tails-you-lose” ploy then the flipper can introduce a GMO known as a two-headed coin, usually a Washington quarter, available for a few bucks at any novelty store.

All this to illustrate that, for all the similarity of circumstances that the obverse and the reverse have on the dime, they can dictate significantly diverse patterns of events.  We use the phrase two sides of the same coin to describe the different, but closely related features, of an idea or course of action.  And so it is with certain non-qualified executive benefits.

All employers want economical ways to keep their key people.  You make your coin by helping them decide which side of the opportunities available best meet their needs and goals.

An Executive Bonus plan (EB) is the most common selective benefit format in the business marketplace, and a Death-Benefit-Only Plan (DBO) is the most overlooked.  Both have as their primary purpose to keep a key person with the company by providing life insurance protection.

Their primary difference is the amount of control the employer has – should the executive choose to leave.  Both are easy to explain, implement and administer.

With an EB plan, simply put, the employer pays for the executive’s personal insurance coverage.  In a DBO plan the employer promises to pay a benefit to a named beneficiary if the executive dies while employed, then buys a company-owned policy to fund against the contingency.  In either case the vehicle can be a permanent or term product.

Often with a DBO the employer chooses to roll the policy out to the executive at the time of retirement.  Even with term coverage the conversion privileges can make the transfer attractive if the executive has had health issues.

Consider the different sides of this coin:

Call to talk about executive benefits in particular and business planning issues in general that you should be discussing with every business client and prospect you have.

Executive Benefit Opportunities:

For what it’s worth – the simplest of all Super Bowl wagers made by bettors is on the outcome of the opening coin toss.  Those who prefer the NFC did well around and after the turn of the century.  The senior conference won the toss from 1999-2012 defying the odds (going in) of 16,384:1.

Principal National Life Insurance Company has announced a significant expansion of their Accelerated Underwriting limits which makes it easy and more efficient to sell Principal Life Insurance products.

What are the benefits of Accelerated Underwriting?

• More satisfied clients who get the coverage they need, without the inconvenience of labs or exams
• Smarter process that leverages digital health data (DHD) whenever possible
• Easier access with no separate AU checklists to complete or requests to submit

What are the eligibility guidelines?

Call your Life Sales Marketing Manager to learn more about this exciting new program.

One of the most important aspects to placing more business is a knowledgeable underwriting team to be your advocate for those challenging cases.  Our Life Underwriting Team has a philosophy we call “never say never”.

We don’t give up on a case because it’s difficult.  We take on the challenge and look outside the box for solutions.

This innovation sets us apart from the rest and helps to get more cases placed for your clients.

Here’s a recent example:

We were presented with case on a 53 year old seeking $2 million of IUL coverage.  Initial tentative assessment of the case was a Table 6 due to a long history of Chronic Kidney Disease with abnormal kidney function testing and impaired fasting glucose, subject to review of additional records.  The client then submitted a formal application at the Table 6 rating.

• Upon review of the additional required medical records, the case was later declined due to elevated A1c (average blood sugar) of 6.5% found in the additional records.
• The lab report was of somewhat poor quality and our Underwriting team questioned the true A1c reading.  We reached back out to the underwriter to discuss and they agreed to review a clearer page of the report to further confirm the A1c.
• We obtained a clearer copy showing the A1c reading was actually 5.8%.  As a result, the case was approved at the initial Table 6 rate class, as applied!

If we had not gone back to the carrier for reconsideration, the case would have remained a decline on the books.  Another way we made a difference to our broker and the client.

Let our Underwriting Team help you with your challenging cases and generate more sales this year.  We look forward to hearing from you.

Some of America’s most beloved and recognizable faces — Maria Shriver, Rob Lowe, Maggie Gyllenhaal, Zach Quinto, Angela Bassett and Jim Nantz — encourage having ‘the talk’ now versus later.

While the conversation is not exactly an easy one to have, a discussion of Long-Term Care planning with loved ones is something that should not be put off.

Don’t just have the talk about long-term care planning because of star power.  Do it because 90% of American adults don’t currently have long-term care insurance.  Do it because 70% of Americans will need some form of long-term care in their lifetime.

8 ways to get the conversation started:

• Be Open – Tell them that you’d like to talk about these issues and ask if they would mind talking about them – everyone thinks about these things and worries about what the future holds.
• Be Reflective – When you’re together, ask them about their past, their childhood, and their parents.  Learn about them.  Then move on to the future.  What do they want most?  How do they perceive the future?  What worries them?
• Discuss Someone Else’s Situation – Chances are that you, your spouse or partner or your parents know someone who is already dealing with some aspect of aging or long-term care.  Talking about what’s good or bad about their situation can be a starting point.
• Mention an Article or Website – Give them a clipping, or link to information about planning ahead, family conversations, long-term care costs, and move forward from there.
• Ask for Advice – This is a great way to get the discussion rolling.  Tell them that you’re starting a retirement account or preparing a will and ask for advice.  Then ask how they planned ahead and if they feel fully prepared.
• Grab an Opening – If, for example, your mother is talking about a family member who’s in a nursing home, and says, “I don’t see how she can stand it,” ask her what she means.  What would your mother want in the same circumstance?  If you miss the chance, bring it up another time soon – “Hey Mom, remember when you said you couldn’t stand to live in a nursing home…”
• Write – If you find the whole conversation thing too daunting – write a letter or e-mail outlining your concerns and what you would like to discuss.  This technique can be particularly helpful if you live far away, or otherwise have only a bit of time on the weekend to attempt this type of conversation.  By writing, you pave the way and get them to start thinking about it before you get together.
• Get Help – Maybe you have a sibling who is more at ease talking with your parents.  Maybe your parents are more comfortable talking to someone else in the family about finances or health.  Don’t be offended.  As long as long-term care planning gets done, all will be good.

Listen to what the stars have to say about the importance of LTCI here

We’re here to help!  Contact your LTCi Sales Rep for support.