As an agent selling long-term care insurance (LTCI), staying informed about key industry facts is essential. Your clients rely on you to guide them through the complexities of LTCI, and having the right knowledge can set you apart from the competition. Here are the top five LTCI facts every agent should know to educate clients and close more sales.
1. LTCI covers more than just nursing homes.
Many consumers mistakenly believe that LTCI only pays for nursing home care. However, modern policies offer a wide range of care options, including:
- Home Care: Professional caregiving services in the client’s own home
- Assisted Living Facilities: Coverage for residential care and assistance with daily activities
- Adult Day Care: Supervised programs that provide medical and social support
- Home modifications, hospice care, and more
Agent Tip: Clients often want to age in place, so emphasize policies that support home care and alternative care settings. This flexibility is a major selling point.
2. Purchasing LTCI early leads to better coverage and savings.
Waiting to purchase LTCI is one of the biggest mistakes clients make. The best time to buy is in their 50s or early 60s, when they’re still in good health. Why?
- Lower Premiums: Premiums are based on age and health, so waiting increases costs.
- Better Approval Odds: Health conditions that develop later in life may lead to higher premiums or even denial of coverage.
Agent Tip: Use real-life cost comparisons to show clients how much they can save by purchasing now rather than delaying. A 55-year-old may pay half the premium of a 65-year-old for the same coverage. The cost of waiting is twofold: higher premiums and the risk of no longer qualifying due to their health.
3. Customization is key—one size doesn’t fit all.
LTCI policies are highly customizable, allowing clients to adjust coverage based on budget, care preferences, and risk tolerance. Key customization options include:
- Daily Benefit Amount: The amount the policy will pay per day for care
- Benefit Period: How long will benefits last (e.g., 3 years, 5 years, or lifetime)
- Elimination Period: The waiting period before benefits start (similar to a deductible)
- Inflation Protection: Younger clients will want to consider an inflation option that will increase their benefits yearly without increasing their premium. This ensures their benefit will keep up with the rising healthcare costs.
Agent Tip: Help clients balance affordability and protection. Some clients may opt for a longer elimination period or a shorter benefit period to reduce premiums while still securing meaningful coverage.
4. Hybrid LTCI policies are a game-changer.
One of the biggest objections that clients have is, “What if I never need long-term care?” Hybrid LTCI policies solve this concern by combining life insurance with LTC benefits. If LTC is needed, the policy pays for long-term care expenses. If LTC is not used, the policy provides a death benefit to beneficiaries.
Agent Tip: Clients who are reluctant to pay for “use-it-or-lose-it” coverage may be more open to a hybrid policy that offers dual benefits. However, keep in mind that hybrid policies are generally more expensive than traditional coverage because they have a dual role of offering a long-term care benefit and/or a death benefit.
5. Underwriting is the gatekeeper to LTCI coverage.
LTCI isn’t guaranteed. Clients must go through medical underwriting to qualify. Common factors that affect approval include:
- Pre-existing Conditions: Dementia, Parkinson’s, and certain chronic illnesses can lead to denial.
- Medications: Some prescriptions signal higher risk and can result in higher premiums or ineligibility.
- Family Health History: Some insurers consider hereditary conditions when assessing risk.
Agent Tip: Be up front with clients about health requirements and encourage those in good health to apply early before any medical issues arise.
As an LTCI agent, understanding these key facts will help you better serve your clients, address objections, and close more sales. By emphasizing the flexibility of long-term care insurance coverage, the importance of early planning, and the availability of hybrid policies, you can help clients feel confident in their decision to protect their future care needs.