Discussing general insurance matters with your clients is difficult enough. However, when the topic is the complicated, emotionally charged issue of long-term care insurance (LTCI), you are now involved in one very difficult presentation. Clouded by fear, denial, confusion, and procrastination, your client often shuts down. The trick to having a successful LTCI discussion is in knowing how to handle these very strong emotional components.
In my work as a LTCI specialist, I have found that there are five mistakes agents often make with respect to long-term care planning. These mistakes can undermine your good intentions and may cause your client not to act. Overcome them, and you will significantly increase your value to your clients while growing your practice.
Mistake #1: Acting "Average"
Do you consider yourself average? Certainly your clients do not think of themselves as average. It is easy to get bogged down in statistics, such as the average cost of care, average length of care, and average age that care is needed. However, no one person is average, and sharing facts that are irrelevant to your clients' circumstances will only cause confusion and ultimately derail your efforts to help them. Your clients need to understand the facts in a context relevant to their lives.
A successful LTCI discussion is accomplished through a discovery process in which you and your clients educate one another. You learn about their specific issues and concerns, and they learn about facts and concepts relevant to their circumstances. You must tailor your presentation to fit their specific world. Remember, it is always the agent's job to find solutions that fit the client's world and belief system, not the other way around.
For example, if you are working with more affluent clients, recommending benefits or quoting costs of care based on national or local averages has no relevance to them. They are in a position to receive levels of care and assistance far superior in quality and much greater in cost than the "statistical averages." Recognizing this and framing the discussion around their needs and resources will have a significant impact on your success.
Mistake #2: Positioning
How do you want your clients to see you? Would you prefer to be perceived as a salesperson or as your client's advocate?
As with other products, there is a lot to master in LTCI. Changing product designs, the Pension Protection Act, the Deficit Reduction Act, HIPPA, state Partnership Programs, hybrid annuity and life products, specialized executive and employee programs — they all have important implications. If this makes your head spin, imagine how your clients feel.
It is very difficult in this business to be an expert in every kind of product or service. In fact, it is close to impossible. The good news is that by bringing in specialists, you can provide a higher level of service while improving your positioning. The use of an expert — either by phone or in person — gives you the opportunity to position yourself on the side of the client, direct thoughtful questions to the specialist, and truly advise the client in making the right decision.
Take a look at your LTCI production and ask yourself:
? Am I actively promoting LTCI to clients who might need or want it?
? Are my clients going elsewhere for this service?
If you are not actively offering LTCI, is it because you don't believe you have the time within your practice, or because you feel it takes you out of your comfort zone?
Your clients need to know that whatever educated decision they make is perfectly okay and that they are never under any pressure to buy anything. This puts both you and your client at ease, creating a less emotional environment so that the issues may be seen more clearly.
Teaming up with a specialist who is 100 percent committed to the LTCI marketplace will provide your clients with expert opinion, analysis, and answers to all of their questions. Position yourself as their advocate. Sit on your clients' side of the table, ask questions on their behalf, and together decide on the solution that best fits their personal circumstances.
Mistake #3: Ageism
Believing that the purchase of LTCI is only for your elderly or older clients is contrary to the fundamentals of insurance and risk management. As with death, the risk of "functional disability" is random and unpredictable throughout our general population. In fact, much like death, the risk of requiring extended personal care becomes almost certain at ages over 80. Would you tell your 40-year-old client supporting a family not to buy life insurance today because he is not likely to die until after age 80? (If you would, there is no need to read any further.)
Do not make this mistake with LTCI because of the stigma it carries with it. There is no magic age to consider this protection; the time to purchase it is when a person is healthy enough to qualify and financially able to pay for it.
Mistake #4: Avoiding the Issue
Because we know the discussion of long-term care is difficult, it may seem safer and easier to wait until our clients ask us about it. However, by avoiding this topic, we are doing a disservice to our clients and our practice.
The brokers who have been the most successful in adding income to their practice through the sale of LTCI have all implemented a proactive process that systematically reaches out to their clients and prospects.
This process is not a reinvention of the wheel or a huge undertaking. It is merely a simple addition to their current health insurance or financial planning presentations. Regularly communicate to your clients the importance of exploring LTCI and remind them that you can help them understand and evaluate their options. Do this before they purchase the coverage from someone else and tell you, "I'm sorry, I didn't know you did that."
Mistake #5: Making Decisions That Are Not Yours to Make
Have you ever convinced a client he does not need LTCI because he has enough money to self insure? Don't.
Insurance can play a very different and appropriate role in the lives of the affluent.
People purchase the health and financial products we offer because they want them, not because they need them. They want them because, through education and awareness, they have come to realize that this insurance puts them in a far better place than they would be without it. Whether your clients are struggling to make ends meet or have amassed great financial comfort, it is your responsibility to present concepts and recommendations that will improve their lives.
LTCI gives your clients more control over their lives just at the time when they feel they will lose control. The dollars a policy can pay affords them more freedom to choose when, where, and how they receive care. They know it will be much easier emotionally for their loved ones to spend the insurance company's dollars on care, rather than the family's dollars.
As with all of life's challenges, individuals who have planned in advance are always in a significantly better position than those who have not. Long-term care planning is not simply a way for agents to add an income stream and increase commissions. As agents, it is our duty to fulfill our role as educators and protect our clients. Take the position of educator, advisor, and advocate, not that of a salesperson. Provide your clients with personalized and appropriate information, be proactive in informing them about LTCI planning, and do not assume they want to self insure. Introduce the concept of LTCI at all ages, and align yourself with the appropriate experts.
Michael Teller is president of All Vest Associates in Delray Beach. He also serves as president of the Palm Coast Association of Health Underwriters. He may be reached at 561-272-0720 or 888-855-5700; e-mail mteller@avaplans.com. Company information is available at www.avaplans.com.
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