The world of long term care insurance has gotten so very complicated. Policy language, definitions, riders and bells and whistles all differ greatly from one contract to the next. Attempting to stay on top of these variations is a difficult task. Carriers continue to introduce "new and improved" plans and insist that they are simpler to sell. In addition, the current trend is for that carrier to continue sales on the older, existing product line. The fact of the matter is that every time a company brings another product to market, the scene gets even more complex -- certainly not simpler. This is because the advisor is now being forced to learn the new while still having to remember the old. In so many ways, selling the product has taken over selling the need for the coverage itself. Are we missing the boat? Why have so many sellers out there stopped talking to prospects about the basics?
As an advisor today, one must understand the policy that is being sold in order to present it. They at least need to know how to access that information from a trusted source. But more importantly, advisors should be concentrating on the actual reasons people buy, and focusing completely on that when talking with a client. For more than a decade, the industry has been told that the two main reasons people buy LTC insurance are to preserve assets and maintain independence.
But let's dig down a little further than that.
One of the best ways to really understand what your prospects are thinking is to listen. Imagine that! Listening is truly priceless. Take good notes. Let them tell you about their lives, their work, their family and experiences. Learn about who they really are and use this information later if and when you are facing objections from them. There is your reason for taking good notes. Do all of this in the very beginning of the interview so they feel comfortable with you. Remind them why they are there (because they expressed an interest in long term care planning) and explain to them what you will be going over regarding LTC.
Now, make sure you find out what they do for a living or what they did if they are retired. Focus on this and let them spend time talking about it. From here, you should go right into discussing the need. This is what you say: "Mr. Smith, you've worked hard." (They've just told you all about their work history.) "You have worked hard to save for retirement. You have worked hard to protect assets and do well for your family. If a long term care event were to happen to you or a member of your family, it could interfere with your plans and dreams. It could interfere with your plans and dreams. Is this something you want to avoid?" Of course, the answer you get will most often be a resounding yes.
Next comes the storytelling. Let them tell you a story about a family member or a friend who needed long term care. Once again, listen. Ask questions about how it was dealt with. How it affected them emotionally. How it affected them financially. Then it's your turn. You tell your story. Spend time on this because this is where it all starts sinking in. The reality of true life stories really brings it home for most people. They start thinking about how there is a possibility that this could happen to them. By the way, if they do not believe that this could happen to them, you're wasting your time. Without the possibility of that belief, you are going nowhere fast. This insurance is not for everyone. Sometimes you just have to be OK with that and walk away. There are lots of other fish in the sea, right?
Make sure you mention what the costs of care are like. Discuss the current rates that are being charged across the country and how, depending on the type of care needed, the costs do vary. The prospect should also be reminded that 20 or 30 years from now, these costs are going to be much, much higher. This is where you spend a little bit of time on the funding sources that are out there. You tell them that health insurance is for skilled medical expenses and disability insurance is for replacing income. Go over the fact that Medicare is primarily used for short periods of rehab that are skilled in nature and Medicaid is for people whose assets have been spent down. Medicaid can also limit your choices. So, what else is there? Self funding, right? Ask your prospect if this could or should be a choice for them. Remind them that the goal generally is to protect assets and income for themselves and their family, not liquidate them. At this point, it is time to ask them if they can think of any way to insure for the risk of needing long term care that makes sense other than with a long term care insurance policy. Let them respond.
Please note that you would have now gone through almost the entire presentation and you have yet to bring up product. No proposals shown. No product comparisons. Nothing. They should be at a point where you can just direct them here by telling them in a simple, easy manner about the choices that are part of the product you are selling. Briefly explain things like benefit amount, benefit period, elimination period, inflation and partnership (if it applies in your state). Ask them how much they would be willing to set aside per month or per year to fund this need.
Don't get caught up in the minutia of policy language with your client unless they take you there. You should absolutely give full disclosure and explain all the important issues, but spend the most time on making sure they understand the need. If this is exactly what you are already doing, then I congratulate you. You should be extremely successful. I honestly believe though, that most of the independent agents in America are not doing this. Maybe you did 15 years ago and have stopped. Maybe you never were told that this is the way to approach LTC sales. Maybe you just think that the easy way out is to begin with a quote in hand. Whatever the circumstance, I implore you to just try it out if you are not currently presenting this way. Someone once said that if you continue to do the same thing, you will get the same result. Well, make a change -- even if it is a slight change -- and expect success! Happy selling.
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