Why (and how) to sell long-term care insurance

With all the turbulence the long-term care insurance market has faced lately, why would anyone choose to specialize in LTCI these days? These three top producers did, though, and they don't regret it. We chatted with them recently to find out why they focus on long-term care planning and how they've been able to find success in the field.

For part two of this Producer Roundtable, see: How to sell LTCI today

Q. With the challenges the long-term care insurance market continues to face, can you share with us a little bit about the reasons you originally made the long-term care market such an important part of your business and the reasons you're still so passionate about it?

John H. Groth, CLU, CLTC, CFP, ChFC, wealth management advisor with Northwestern Mutual: I am passionate about long-term care — LTC — planning because we have planned for it as part of our overall plan to provide our family financial security. Since I have put this plan in place for myself, I think it only makes sense that I discuss it with all of my prospects and clients. They need to be aware of their options so that they can make an intelligent decision for their family's financial security.

Thomas F. Levasseur, CLU, CLTC, M.S. Ed., founder, Beacon Retirement Group: I initially started providing these risk-based products not long after I began my career. As primarily a life insurance-focused salesman for, at that time, a primary company, the protection of assets approach was similar to the use of life insurance to pay estate settlement costs. It was an asset protection sale that fit my early marketplace of small-business owners. At some point, I was introduced to Harley Gordon, the founder of the Corporation for Long-Term Care Certification or CLTC. I took the course from him personally, and that created a paradigm shift for me. The philosophical approach of developing a plan for long-term care made me more passionate about the placement of the product as part of a family's strategy for dealing with an LTC event. This strategic planning approach to product placement has permeated my whole approach to offering risk-based products to my clients and prospects.

Brett M. Sause, LUTCF, LTCP, CLTC, principal, Atlantic Financial Group LLC: I entered into the long-term care market because I witnessed first-hand the difference LTCI can make in a person's life. Even in my own family, I have seen how the cost of LTC may affect the assets of people I love because they did not have a plan in place. This inspired me to educate people about this financial tool to help protect them and their families from the potentially high costs associated with long-term care. I remain passionate about this market because I know the importance of using LTCI to help protect assets.

Q. In your experience, is the market generally informed or uninformed about the need for long-term care insurance? Do you have to educate prospects on that need, and if so, what techniques do you use to accomplish that?

Sause: In my experience, the general public is typically uninformed about the need for LTCI. Many people believe they live in a perfect world and don't think anything will happen to them. I too lived in the perfect world until age 19, when the unthinkable happened to my family. My father became terminally ill at the age of 52. Without an appropriate plan to help pay for the expense, there was a toll on my family, both emotionally and financially.

Unfortunately a crisis is sometimes the motivation necessary to get people to act. I share my personal experience with my clients and prospects in order to educate them so they may not have to endure something similar. I find my honesty and willingness to answer the tough questions with my clients fosters their trust in my ability to help them in their LTC planning.

Occasionally, I will meet a client who has seen the implications of an unexpected need in his or her family. They are almost always interested in talking about ways to plan for an LTC need. They understand the value of protecting themselves and their family, as they plan for an uncertain future.

Groth: The market is getting better informed, but there are still pockets of people, even professionals who help people with making decisions on this issue, who are prejudiced by myths and misunderstandings. The technique I depend on is showing my prospects and clients the facts with our Northwestern Mutual Personal Planning Analysis (PPA). PPA provides our prospects with an analysis of their retirement that enables the prospect to see the impact an LTC event would have on their lifestyle at whatever age they want me to analyze. When they see the impact of two different scenarios, they are ready to look at LTC planning much differently.

Levasseur: I believe the public can always be more well-informed about most financial concepts and strategies. Like with most things, the media in general, and the financial media in particular, is more interested in selling subscriptions and advertising by reporting sensational and negative stories than they are in providing information. In part, this has made consumers more cynical these days than ever before. Advisors must overcome this condition by providing fair and balanced information — information that is tailored to the individual need. In the end, the individual's truth and wisdom is what really counts. I try to ask a lot of questions and listen carefully so that I earn the confidence of people and, therefore, the right to contribute to their thinking. The CLTC approach works best because it presents a logic-based rather than a product-based strategic evaluation and decision-making process.

For more on long-term care, see:

How to transfer IRAs to LTC insurance

LTCI for everyone!

The real cost of (not having) LTCI