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LTC Detective Work – 6 Things You Need To Do

Long-Term Care can be a tough subject.

Often times, you have to do a little detective work to ensure your cases are processed through Underwriting quickly.

Here are six things you can do to help uncover important information the underwriter needs to issue your case.
 
Ask about specialty physicians.
  • If your client had bypass surgery, ask whether they have a cardiologist.
  • If they had joint replacement, ask if they have an orthopedist.
  • If they have rheumatoid arthritis, ask if they see an arheumatologist.
  • If your client is taking multiple medications for depression and anxiety, ask if they have a psychiatrist.
  • If they have diabetes, ask if he sees an endocrinologist.
Pay attention to the date of diagnosis.
A recent diagnosis (within six months to one year) may not be enough time to assess the client’s stability.
 
Note the date of the last doctor’s visit.
If it’s been over two years since your client’s last physical exam and lab work, they won’t qualify for preferred underwriting. Also, pay attention to recent doctor’s visits. Ask your client if they have a follow-up visit planned. Knowing an applicant is undergoing treatment allows the underwriter to order an attending physician’s statement immediately, instead of waiting until the client mentions it during the personal health interview.
 
Listen carefully for these things:
  • Pending tests – Be sure to ask if the client is scheduled for a test that has not yet been performed.
  • Recent surgeries – Ask what type of surgery the client had. Was a malignancy found? Has the wound healed? You also should ask if the client is released from care or requires further follow-up.
  • Physical therapy – Ask about the diagnosis. Is the pain or condition resolved? Do they require further treatment? Find out if the physical therapy helped or if surgery has been recommended.
Try to identify the diagnosis behind the medication.
Many people refer to a medication in terms of the symptoms it addresses. For example:
 
  • Your client says they take a “water pill for fluid.” This can mean several things, from occasional lower extremity edema to something more serious, like heart failure. Also, pay close attention to the medication dosage as this can be a clue to your client’s condition.
  • Many applicants will indicate they take a “blood thinner.” Ask about the diagnosis. Is there a history of stroke or mini-stroke? Has the client had any type of heart surgery and, if so, when? Has the client had blood clots? If so, how long ago? Has the client had surgery of the leg?
  • If your client says they take a medication for “bones” or to “prevent osteoporosis,” ask if they’ve had a bone density test done in the past two years and what the doctor told them about their bone density. Typically, these medications aren’t prescribed unless bone density tests have indicated the applicant has some type of bone loss, which impacts insurability.
  • If your client mentions taking a medication for “arthritis,” you should suspect rheumatoid arthritis or another serious condition and rate accordingly.
  • If your client lists pain medications, specifically narcotics, it’s very important to find out the reason the medication is used, how often it’s taken and how long the client has used it. For example, does your client use it only after they mow the lawn or do they have pain on a daily basis?
Question everything.
If you have a client who is young, but not working, ask why. Do they have chronic health conditions that prevent them from working? Are they collecting disability benefits? The underwriter needs to know.
 
Please contact your LTC Specialists for more information.
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Yes, Long Term Care Insurance Can Be Affordable

While it’s a common belief that designing affordable Long-Term Care (LTC) coverage may prove difficult, if not impossible, there are ways to ensure manageable costs.

An LTC insurance policy is only as expensive as you make it.

Flexibility in plan design and product features enables this coverage to be available to meet most budgets. When putting a plan in place for your clients, keep these cost reducing tips in mind to prevent sticker shock:
 
Suggest An Asymmetrical Case Design
 
You may have some clients who want LTC coverage for themselves, but not for their spouse due to cost. While two fully loaded policies may prove costly, coupling a “token” benefit policy for one spouse can save a significant amount on their premium.
 
What can they expect to save?
 
  • One of our strategic carrier providers offers a 40% discount for a married couple applying together (both approved) versus no discount for a married person applying alone.
  • Other carriers will offer a 20-30% discount for a married couple applying together (both approved).
 
Take Advantage Of Age And Health
 
The earlier your clients start thinking about long-term care, the more options they’ll have to consider, and the more affordable those options will be. The ideal age to start the planning process is between 45 and 60.
 
Here are two big reasons why:
 
  • The younger the clients are, the lower their annual premium will be versus a comparable policy purchased at an older age.
  • The younger the clients are when they apply for coverage, the better chance they’ll qualify for a preferred health discount. The older they are, the more likely the application for coverage could be denied.
 
Adjusting To Fit A Budget
 
Regardless of a client’s age, they likely have a variety of other competing financial priorities on their mind. LTC insurance coverage doesn’t have to be an all-or-nothing decision.
 
The most important thing is to make sure to put some level of protection in place, versus ignoring the risk altogether. Having a pool of money in place enables clients to hedge against the risk of needing care someday.
 
We’re here to help you design a plan that is both affordable and the best solution for each of your clients’ needs – contact your LTC Specialist today.
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Inflation Protection: One Size Doesn’t Fit All

Increasingly, people are recognizing the need for Long-Term Care (LTC) Insurance earlier in life.
 
Since your clients may purchase a policy 20 to 30 years before they might need to use their benefits, it’s important to consider inflation protection when you design their Long-Term Care Insurance plan.

Inflation protection riders can help protect your clients’ assets against the rising costs of LTC.

With so many riders available, which one should your clients choose? Which option is the best for a particular client depends on many factors, including their risk tolerance, personal preferences and budget.
 
3% or 5%?
 
When it comes to compound inflation protection options, your clients’ choice is often between the 3% or the 5% benefit increase riders.
 
Historically, the 5% compound inflation protection option was often considered the best choice because it maximizes the potential pool of benefits. However, the cost of long-term care is now rising at a lower rate than in the past.
 
For many years, nursing home and other long-term care costs increased at around 7% per year. Currently, the average five-year annual growth of facility care was about 4%. The cost of home care has been increasing at an even slower rate, with average five-year annual growth of just above 1%.
 
Compared to the 5% compound inflation protection option, the 3% option is less expensive, and the data suggests it may provide adequate inflation protection to keep up with the rising cost of home care.
 
Know Your Client
 
Your clients have several alternatives to help protect them from the rising cost of care. A 3% benefit increase rider may be the right option for those clients looking for dependable inflation protection at a lower cost.
 
Talk to your clients about their priorities, and help them choose the best inflation protection option for them.
 
We’re here to help you design a plan that is both affordable and the best solution for your clients’ needs – contact your LTCi Sales Rep for guidance.
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How LTC Insurance Can Lower Your Clients’ Tax Bill

How do you get people to sit up and take notice? Talk taxes. Tell them you have a way to help them reduce their state and federal tax bill.

A Long-Term Care Insurance (LTCi) policy has the potential to help people lower the amount they pay in taxes.

And at the same time, LTCi provides valuable insurance coverage that can help them remain in their home, protect their retirement nest egg and ensure they won’t have to rely on their kids to take care of them.
 
LTCi Premium May Be Tax Deductible
 
Each year, the federal government sets guidelines for tax deductibility. Individual policyholders may be able to deduct a portion of the premium paid for a tax-qualified LTCi policy. This is called eligible premium.
 
Business owners who use business dollars to purchase LTCi can also experience significant tax savings based on the tax structure of the business:
 
  • Self employed business owners may deduct eligible premium paid for the owner, spouse and dependents. They also may deduct the total premium or actual premium paid for employees.
  • Owner/employees of C Corporations may deduct actual premium for the owner/employee, spouse, dependents and employees.
Policy Benefits May Be Tax Free
 
Benefits received under a tax-qualified LTCi policy are intended to be tax-free as long as they do not exceed the greater of actual qualified LTC daily expenses or the IRS’ per day limitation.
 
Out-of-Pocket LTC Expenses May Be Tax Deductible
 
Generally any LTC expenses the policyholder pays out-of-pocket may be claimed as a medical deduction on a federal income tax return. The only exception is payment for home care provided by a family member who is not a licensed health care professional.
 
Some States Also Offer Tax Deductions
 
Currently a number of states offer tax deductions and/or credits for people who purchase qualified LTC Insurance policies. And these state deductions and credits are in addition to those offered by the federal government.
 
There’s No Better Time to Talk Taxes
 
Everyone is looking for ways to save, which is why now is a good time to talk to prospective clients about the tax advantages of purchasing LTCi. They’re sure to be more receptive when they learn that purchasing the coverage they know they need also can help them reduce their tax bill.
 
For more information, contact your LTC Specialist today.
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Controlled Executive Bonus With LTC Benefits

A Controlled Executive Bonus Plan, also known as a Restrictive Executive Bonus, or Section 162 Plan, is an agreement between an employer and its key employee(s) to provide a death benefit, supplemental income, and now includes long-term care benefits.
 
The employee applies for and owns the life insurance policy, with the right to designate the beneficiary(ies) of the policy.  The company then pays the “bonus” premium directly to the insurance company.

The employee’s right to receive the cash value of the policy through loans, withdrawals or surrender is restricted during a time period based on age, years of service or other conditions agreed upon by the company and the employee.

If the employee terminates employment during this restricted period, the company must agree for the employee to have access to policy cash values.  The employer, at that time, may require repayment of some or all of its “bonus” premiums from the policy’s cash value in exchange for its agreement.
 
*Subject to agreement
 
A Controlled Executive Bonus Plan has two advantages to the employer:
 
  • Pay key employee(s) a bonus in the form of a life insurance premium
  • Can take a current deduction for the bonus
Benefits of a Controlled Executive Bonus Plan
For the employer:
 
  • Can select which key employees can participate
  • No mandatory eligibility and participation rules
  • No IRS restrictions or approval
  • No government forms or reports, minimal administration
  • “Bonus” premiums are tax-deductible
  • Recruit, reward and retain key employees using “golden handcuffs”
For the employees:
 
  • Income-tax free benefits paid to surviving family at death
  • Permanent life insurance protection
  • Long-term care benefits available
  • Tax-deferred growth of policy cash values
  • Income-tax free death benefits
  • Although the employee must report the life insurance premiums paid each year as taxable compensation, impact of this can be minimized by the employer providing a cash bonus to the employee sufficient enough to cover both the premiums and income taxes due
  • Unrestricted ownership of policy and its values after the restricted period ends
The endorsement is executed by the employer and employee and filed with the insurance company.  For a specified period of time agreed to by the employer and the employee, the endorsement restricts some of the employee’s ownership rights in the policy.
 
During the restricted period, the endorsement restricts the right of the employee to surrender the policy, assign the policy as collateral, change ownership or make a policy loan, unless the employer also agrees.  The restrictive endorsement is typically designed to expire at a defined point, usually between 5-15 years.
 
For more information about the long-term care benefits included in a Controlled Executive Bonus Plan, please contact your LTCi Sales & Marketing Manager.
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Profitable Prospects Lie In Multi-Life LTCi Sales

Multi-life LTCI continues to be one of the leading sales opportunities in the long-term care insurance marketplace today. Usually the hardest part of making a sale is finding the prospect, however, a multi-life prospect might be as simple as opening your client files.

Chances are, you already have clients who could be excellent contacts to expand your LTCI worksite business.

Look for existing clients who meet one or more of the following hidden multi-life triggers:

  • Owns a business or holds a professional occupation such as an attorney, physician, CPA or consultant
  • Holds a high level position or has influence in the executive decision making process
  • Runs a successful business that’s looking to offer more benefits to its employees
  • Could benefit from the tax incentives of purchasing LTCI with company dollars
  • Owns a business with employees who could benefit from discounts and possible underwriting concessions

Keep in mind that your best prospects may be organizations that are willing to pay some or all of the premiums for five or more policies.

Gaining multiple LTCI sales from a single contact benefits you, but what about your clients?

Not only are there a variety of carve-out benefits to choose from; there are additional benefits they should be made aware of:

  • Generally not subject to ERISA
  • Employer paid premiums are often deductible as an ordinary business expense
  • May qualify for reduced underwriting and discounts
  • Unisex pricing

To learn more about the multi-life sales opportunity, please contact your LTCI Sales Rep today.

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Asking The Tough LTC Questions

When you meet with your clients to fill out a Long-Term Care application you are faced with asking tough questions. At times, not all clients feel comfortable telling you which medications they are on or why, or how much they weigh.

As an agent, it is your job to be thorough when completing the application in order to get your client the best offer available.

Here are some tips on asking the tough questions:
 
Set the Stage
 
Let your clients know why you are asking these personal questions. You could say something like this:
 
“Mr. and Mrs. Client, you don’t have to be in perfect health to get Long-Term Care Insurance, but you do need to be in relatively good health. It’s my job to gather that information, so I need to ask you some questions about your current health and about any medications you may be taking.”
 
Get An Accurate Health Picture
 
Just as a doctor needs complete and accurate information to make a diagnosis, you need it to make the best recommendation for your clients. Encourage them to be completely honest and thorough when answering health questions.
 
Learn The Story Behind The Medication
 
The medications your client takes usually tell the story but you should dig deeper to find out what conditions a medication has been prescribed to treat. It is a good idea to familiarize yourself with common medications associated with uninsurable conditions.
 
Here are some common medications you should be familiar with:
 
  • Prednisone is prescribed for COPD and Rheumatoid Arthritis
  • Requip is prescribed for Parkinson’s Disease
  • Aricept is prescribed for Dementia
  • Avonex is prescribed for Multiple Sclerosis
Don’t Guess How Much Your Client Weighs
 
Ask them and remember to use build charts to assist you when filling out applications.
 
Lastly, it is smart to include a cover letter with the application stating information you learned about your client that may not have been required to disclose on application. This allows you to share more with the underwriter such as your client’s habits, lifestyle and what they are doing to manage current health issues. Remember, the more you can tell the underwriter about your client, the better chance for a positive underwriting outcome.
 
For more information on how to approach your clients about Long-Term Care applications contact your LTC Specialist today.
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8 Ways To Ease Into The Talk

Some of America’s most beloved and recognizable faces — Maria Shriver, Rob Lowe, Maggie Gyllenhaal, Zach Quinto, Angela Bassett and Jim Nantz — encourage having ‘the talk’ now versus later.

While the conversation is not exactly an easy one to have, a discussion of Long-Term Care planning with loved ones is something that should not be put off.

Don’t just have the talk about long-term care planning because of star power. Do it because 90% of American adults don’t currently have long-term care insurance. Do it because 70% of Americans will need some form of long-term care in their lifetime.
 
8 ways to get the conversation started:
  1. Be Open – Tell them that you’d like to talk about these issues and ask if they would mind talking about them – everyone thinks about these things and worries about what the future holds.
  2. Be Reflective – When you’re together, ask them about their past, their childhood, and their parents. Learn about them. Then move on to the future. What do they want most? How do they perceive the future? What worries them?
  3. Discuss Someone Else’s Situation – Chances are that you, your spouse or partner or your parents know someone who is already dealing with some aspect of aging or long-term care. Talking about what’s good or bad about their situation can be a starting point.
  4. Mention an Article or Website – Give them a clipping, or link to information about planning ahead, family conversations, long-term care costs, and move forward from there.
  5. Ask for Advice – This is a great way to get the discussion rolling. Tell them that you’re starting a retirement account or preparing a will and ask for advice. Then ask how they planned ahead and if they feel fully prepared.
  6. Grab an Opening – If, for example, your mother is talking about a family member who’s in a nursing home, and says, “I don’t see how she can stand it,” ask her what she means. What would your mother want in the same circumstance? If you miss the chance, bring it up another time soon – “Hey Mom, remember when you said you couldn’t stand to live in a nursing home…”
  7. Write – If you find the whole conversation thing too daunting – write a letter or e-mail outlining your concerns and what you would like to discuss. This technique can be particularly helpful if you live far away, or otherwise have only a bit of time on the weekend to attempt this type of conversation. By writing, you pave the way and get them to start thinking about it before you get together.
  8. Get Help – Maybe you have a sibling who is more at ease talking with your parents. Maybe your parents are more comfortable talking to someone else in the family about finances or health. Don’t be offended. As long as long-term care planning gets done, all will be good.
We’re here to help! Contact your LTCi Sales Reps for support.
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3 Simple Steps To Generate More LTCi Leads

While educational seminars or direct mail campaigns are good lead generation tools, these campaigns can be costly and usually take time to yield considerable results.

So how can you build momentum and grow your Long-Term Care Insurance business without breaking the bank?

Follow these 3 simple steps:
  1. Identify price-sensitive consumers in your client/prospect database who are currently on the fence. While these leads may have grown cold, the introduction of an affordable price point could warm ‘em right up.
  2. Schedule a brief meeting with each of the prospects you’ve spoken with in the past, to discuss the type of plan that would meet their needs and budget concerns.
  3. Use tailored needs-based marketing and support. You stand a better chance of shortening your sales cycle and generating new business.
Make certain your clients have the right LTC plan in place to meet their needs.
 
Contact your LTCI Sales Rep for more information.
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Honoring The Last Wish: The Realities Of LTCi

“What’s your plan?”
 
That’s the question we encourage agents to ask their clients – because when there isn’t one, the consequences can be heartbreaking.
 
The New York Times article referenced below addresses the realities of what can happen when there is not a plan in place – through the tragic struggles involved in trying to honor a man’s wish to die at home.
 
It documents the various requirements of the healthcare system, including Medicare and Medicaid, that can make it nearly impossible to get in-home care.

When you read the story of Joseph Andrey, think about the impact you can have on someone’s dignity of life.

You have the opportunity to make sure this does not happen to any of your clients.
 
Access the New York Times Article: “Fighting To Honor a Father’s Last Wish: To Die at Home” here.
 
A comprehensive long-term care insurance policy will cover home care, adult day care, hospice, as well as, assisted living and nursing home. It also provides the insured with the dignity and independence to choose where they get their care.
 
Please contact your LTC Specialist to discuss how we can help you make a difference in your client’s lives – to design a plan that is both affordable and the best solution for your clients’ needs.

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