Who wants to think about growing old? What about the idea of not being able to take care of yourself, of needing help in and out of bed, the shower, the bathroom? The potential indignities and loss of independence are too much to swallow, so we push it out of our heads. We ignore the issue until it's too late, telling ourselves we'll take care of it eventually or that we don't need it because we'll be full of vitality until the day we die.
It's the same reason why 22 percent of American households have no life insurance coverage: Nobody wants to think about the unthinkable, be it death or old age. But what's worse: confronting the future, or having it sneak up on you when you're least prepared?
According to a recent study conducted by the Agent's Sales Journal and the American (AALTCI) Association for Long-Term Care Insurance (which begins on page 12), many prospects shy away from long term care insurance because they believe the premiums are too high. There are, however, ways to lower those rates. There are spousal discounts, good health discounts, and more. And, of course, the younger you are, the lower your premiums.
And then there's the alternative: According to a 2005 MetLife study, an assisted living facility costs an average of $2,905 a month, or $34,860 a year. And keep in mind that the average length of stay at an assisted living facility is 2 1/2 to three years, according to an AARP report.
Comparatively, if your client is 55 and qualifies for spousal and good-health discounts, they'll pay only $772 a year, according to the latest price index from AALTCI. At $772 a year for an LTCI policy, your client pays $2.11 a day in premiums. If they don't, they could owe $34,860 a year for long term care, or a whopping $96 a day.
And while cost is the foremost barrier to an LTCI sale, there are many ways to conquer objections such as "It's too expensive," "I'll buy it later," or "I don't need it." Try asking thought-provoking questions such as, "Are you comfortable with your family taking care of you should you lose your ability to perform basic daily activities?" "Do you have enough money to pay for long term care without depleting your assets?" "Do you want to be dependent on somebody else at some point in your life, for the rest of your life?"
Some may answer "yes" to those questions, but many will answer "no". And that's when you can show them how they can save money, why they should buy now rather than later, and why they do need the coverage. It pays to know the facts, the figures, and the motivation behind a purchase. Make sure you can offer all that and more to your clients, and you'll all be rewarded in the end.
Market research
In our LTCI survey, conducted in July in conjunction with AALTCI, we asked more than 700 agents about their impressions of and experience in the long term care insurance marketplace. We asked them why they offer LTCI, why their clients buy it (and why their prospects don't), how well wholesalers and insurers meet their needs, what types of policy features they're selling, and more. The survey results kick off our LTCI Selling Guide, beginning on page 12, which contains expert advice on prospecting for LTCI clients; selling to untapped markets such as prospects under 50 and women, and how to make the sale using groundbreaking selling strategies. You'll want to hang onto this issue for a long time.
A month of awareness
Have you heard of Life Insurance Awareness Month, held every September? Are you making the most of it? If not - or even if you feel you could use a boost over last year's production - turn to our special Life Insurance Awareness Month handbook on page 50. Learn what resources are available to you, how to motivate clients to purchase life insurance, and how to keep your momentum through September and beyond. We know life insurance is essential. But do your clients? Take this chance to show them why.
Sincerely,
Christina Pellett
Managing Editor
Christina@AgentMediaCorp.com
