Selling long-term-care insurance (LTCI) can be lucrative, but it’s more challenging today. There’s more competition, as seniors are deluged with more direct mail. Buyers are more educated and skeptical, and many have already talked to an agent.
The low-hanging fruit has been picked, but there are still plenty of golden apples on the tree. You just have to know where and how to harvest them—and be better than the next agent.
People can buy LTCI, annuities and life policies from anyone. To get them to buy from you, you’ll need to fine-tune your relationship skills and offer more innovative solutions.
Take the prospect into the future and help him envision a time when his health is declining.
Put the client first
As a cutting-edge advisor, you’ll listen more to your clients and prospects. You’ll fill more of their needs and show them different, innovative solutions. You’ll demonstrate that you have their needs in mind, and before you sell anything, you’ll establish trust—the basis of all fruitful relationships.
Unfortunately, many insurance companies’ training programs are too product-focused. Yes, you do need to know your products inside and out, but that’s only the start. Don’t go into any sale with your “product hat” on. You never want the prospective client to see you as a product pusher just looking for the next sale. Instead, you want to be positioned as an advisor who will search out and find the best solutions available. It’s all about clients and their needs—not you or the product.
Creating a need
The key is to create the need in the prospect’s mind. No need, no application. It’s that simple. To create this need, you must take the prospect into the future and help him envision a time when his health is declining. Usually, the older the prospect, the easier that job is. A 70-year-old can more easily imagine that than someone who’s 55.
Still, at any age, you’ll run into a wall of denial—the “It won’t happen to me” wall—particularly among men. “What do you plan to do when your health changes?” is a powerful question that can start to punch the first hole through the wall of denial. Long-term care sales training can help you learn how to overcome denial and create need. It’s vital for both newcomers to the senior market and for veterans who want to polish their skills.
Once you’ve established need, then you can offer various solutions, which might call for LTCI, life insurance, annuities or a combination of products. Determining what’s most appropriate gives you an edge over someone who’s only focused on selling LTCI and assumes that one size fits all.
Get their attention
Direct mail is still a great way to create prospects, but people often discard it unless they see something special on the envelope or postcard. Creativity pays off, as does repetition. Recipients often will toss out the first two mailers from you but open up the third.
Try different wrinkles with your marketing. How about a seminar on dealing with the economic changes brought about by the death of a spouse? How can surviving spouses still maintain their lifestyle despite a drop in Social Security and perhaps other benefits? How can they plan and make sure their beneficiaries on their various policies and retirement plans are correct?
Informal market research can pay off. Even if you think you know your marketplace, you may be surprised at what you’ll find out. Here’s one idea: Meet with 10 people in the age group you like sell to—seniors, Boomers or whatever. Hold a mini-focus group. Find out what type of mail they respond to, which seminars they’d attend and what bugs them most. You’ll hear war stories that will give you valuable ideas. From seniors, you may hear comments like: “I like agents who aren’t too pushy” or “I don’t like it when they try to sell me too many products at the same time.” You’ll get a good understanding of their key buying indicators.
Reviewing the prospect’s whole financial picture will help you develop alternatives.
When someone responds to your mailer and calls to ask for more information, remember that your objective is to get in front of the client. On the phone, don’t talk about yourself. Ask the prospect a few questions, but don’t probe too deeply. After that brief conversation, you can reply: “Here’s what I suggest. Let’s get together and see if we can find something that meets your needs.” If you leave the topic wide open, you’ll get less resistance to arranging a meeting at your client’s home or your office.
Service after the sale is the right thing to do, and good will pays off. I recently helped an 81-year-old woman fill out the paperwork for long-term care benefits on a policy I sold her in 1996 as well as a policy she subsequently bought from another agent. The other agent told her she could complete the forms herself—but she couldn’t. I got three good referrals in return for my help.
Innovative product solutions
While the cost of long-term care is the biggest financial risk facing seniors, traditional monthly-pay LTCI isn’t always the best or most appealing solution—especially with today’s higher premiums. Reviewing the prospect’s whole financial picture will help you develop alternatives.
Many Boomers and seniors have life policies that no longer carry surrender charges and have built up substantial cash value. The old policy can be swapped for a new one, tax-free. Older policies cover only one circumstance: death. Today, you can tell prospects that you can offer them a better policy that provides more benefits they can use while they’re alive. Life policies with accelerated benefits typically cover critical care, terminal illness and nursing-home care. Some policies offer accelerated benefits through a rider that doesn’t cost anything extra until the benefits are used; some charge extra for the riders. A few companies offer a separate LTCI policy wrapped within a life policy, the earnings from which pay for the LTCI coverage.
These combination policies are a perfect planning tool for Boomers, particularly business owners in their 50s who aren’t yet terribly concerned with long-term care but have a nagging feeling they should take care of it somehow. With that age group, you might start out with a combination policy and add an ordinary LTCI policy later. The combination policy also makes a good supplement for seniors who already have an LTCI policy that doesn’t provide enough coverage.
Taking withdrawals from the client’s existing annuities is another creative way to pay the premiums on a multipurpose life policy without creating a cash drain. This is a taxable event, but in return, the client creates future income-tax-free income from the new policy at no risk.
By offering these solutions, you position yourself as an advisor who’s offering something new and different that prospects haven’t heard about from other agents. Marketing savvy and topnotch face-to-face sales skills plus product knowledge will put you in position to harvest the gold of these markets.
Wilma Anderson, The LTC Coach, in Littleton, Colo., specializes in sales training for the senior market, offering services from individual coaching to sales systems and videos proven to boost production. Contact her at 720-344-0312 or Wilma@TheLTCcoach.com, or visit www.TheLTCcoach.com.