If you sell long-term care insurance (LTCI), you may find it a difficult sale these days. Your clients probably have many misconceptions about why they don’t need it and typically offer various objections. We often counter these by telling them how more and more people are entering nursing homes these days and pointing out the extended life spans of many individuals.
Unfortunately, these responses do not persuade many to sign on the dotted line or help them plan for this event. While statistics are important, what will really sway your clients lies in a message from an old Beatles’ song title: “All You Need Is Love."
SHOW YOUR CLIENT THAT HE CAN’T AFFORD NOT TO BUY LTCI.
Put yourself in your clients’ shoes. Why would you buy LTCI? Is it because you want to protect your assets, you want to get your care at home, or you don’t want to go to a nursing home? No. It is most likely because you love your family and want to protect them and your spouse’s retirement. Just as with life insurance, it is not the family member who has died that has a problem. It’s the remaining family members who have to deal with the debt and problems of a premature death.
When you’re selling LTCI, that’s the position you need to take. It’s not about statistics; it’s about what happens to the family you love when a mother or father becomes chronically ill.
At a seminar our company sponsored, Harley Gordon, president of The Corporation for Long-Term Care Certification Inc., provided a strategy for properly positioning LTCI as a fundamental part of everyone’s health-care plan.
Start by putting your client at the center of your conversation and establish three key agreements:
- That the client believes he will live a long life and, when he does, he may get sick and may need care.
- That long-term care is a family issue and will have a devastating effect on the family and the best thought-out retirement plan.
- That nothing will pay to protect that family and retirement plan except LTCI.
At retirement, a client puts together with his financial advisor an investment strategy that protects his principal and creates an income to live on. He usually asks his advisor to make sure the income lasts until at least age 90 because he plans on living a long life. Impart the understanding that long-term care is a significant risk the older we get.
There is no question about who will take care of your client in his older years—his children. However, long-term care rarely brings families together; in fact, it tears them apart, mainly because siblings generally don’t share parental care equally. Children take care of their parents because they love them and are concerned for their safety. While they may not want to be the caretakers, they usually can’t be talked out of it. “Therefore,” Gordon says, “don’t present LTCI as an alternative but as a complement. It doesn’t replace what families do, but builds on an existing infrastructure of support, allowing caregivers to provide care better and longer by offering help with the things the family may find the most difficult or embarrassing to perform."
When you position your services as the family’s support structure, they begin to see you as their partner, and you turn them into proponents of LTCI.
Paralleling life insurance
Actually, selling LTCI is exactly the same as selling life insurance, with word substitutions. In a life insurance presentation, you would say, “I need to talk to you about the consequences an early death could have on your family.” In selling LTCI, you would say, “I need to talk to you about the consequences living a long life would have on your family.” Continue to follow the steps you would follow to close a life insurance sale.
As you work through your discussion, establish beyond a reasonable doubt that without LTCI, nothing will pay for the care of family members, except assets and income otherwise allocated for retirement. Then propose a way to protect the person’s or family’s retirement fund and family from this risk. By making recommendations on how to improve the client’s portfolio to meet retirement needs, you position yourself as a trusted advisor. Then suggest purchasing a “medi-gap” policy.
A common objection is that LTCI is too expensive. Show your client that he can’t afford not to buy LTCI. Remind him that you’ve calculated the payout on living to age 90 and that at that age, disability income and term insurance policies are no longer in force. Suddenly, it becomes apparent that his only protection is the nest egg he worked so hard for.
Clients who have already bought LTCI from you did so because they understood the risks and connected those risks directly to themselves. Once your client firmly believes those two points and realizes that you are saving his retirement fund, there’s nothing left for him to do but sign on the dotted line.
Tom Riekse Jr. is executive vice president of LTCI Partners, LLC, a nationwide brokerage agency serving the long-term care industry. For more information, call 800-245-8108.