3 traditional LTCI alternatives expedition reports

San Antonio — Some of the long-term care insurance (LTCI) community players who came for the Intercompany Long Term Care Insurance (ILTCI) conference this week are trusting in the raw care-financing power of traditional LTCI to get them through the current hard times.

Attendees are watching eagerly to see whether National Guardian Life, for example, is going to roll out a new traditional LTCI product. Rumors about the product have been circulating for months.

John Hancock, Genworth and other carriers are promoting new, and relatively new, next-generation traditional LTCI products that are designed to withstand a low-interest-rate universe.

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Traditional LTCI players have been known for their passion for the raw long-term care (LTC) services financing power of traditional LTCI, but this year some longtime traditional LTCI market loyalists are here to talk about projects in other, nearby sectors.

For a look at what three of those explorers are saying, read on.

John O'Leary

1. John O'Leary

John O'Leary, a veteran LTCI product development consultant, ran a session on a new product concept he's working on: simple, inexpensive term life insurance that turns into an LTCI policy when the insured turns 65. The insured would cope with inflation with a coverage purchase option, rather than a built-in inflation adjustment feature.

O'Leary showed analyses suggesting that, for a 45-year-old purchaser, an issuer could hold the monthly premium for a policy like that with a $100,000 death benefit and a $135 daily LTCI benefit to about $50 per month.

O'Leary said he wanted to hear other people's reactions to the concept. "The objective of this session is to see where the leaks in the boat are," he said.

O'Leary said regulators in California, Minnesota and Nebraska seem to be interested in the product concept.

One audience member said he had run into trouble with a similar product development effort years ago: At that time, regulators had viewed a hybrid product that provided LTC protection only after retirement as a "long-term care insurance product with a 35-year exclusion period."

(Image: James O'Leary. LHP/Allison Bell)

2. Bill Jones

Bill Jones is the former president of MedAmerica Insurance Company who now leads the National Alliance of Insurance Agencies Inc., an organization that connects manufacturers of short-term care insurance (STCI), annuity-LTC hybrids, life-LTC hybrids, noninsurance products, and other alternatives to traditional LTCI with independent insurance agents and agencies.

One product that excites him is a family of group life products from Transamerica that offers workers access to life-LTC combination features.

Jones said he looks for agents who are already active in the market and offer them products that complement what they're already selling.

For insurers and other product manufacturers, the key to getting the attention of the best agents and brokers is to offer tools that fit in with the new virtual sales processes, Jones said.

Today, he said, agents may sell through conference calls and webinars rather than physical meetings. To support that, the product makers need to offer electronic signature capabilities, electronic application submission systems and other tools.

"We're all in the service business," Jones said. The product makers need to support the agents, just as the agents need to support the consumers, he said.

(Image: Bill Jones. LHP/Allison Bell)

3. Jonas Roeser

For Jonas Roeser, the co-founder and chief executive officer of AgentReview.net, an insurance agent directory and review site, business and investor support have been strong enough that Agent Review could sponsor the ILTCI Conference keynote speaker.

Roeser explained that the directory service offers free, basic entries for all agents who choose to participate. Agents can pay more for richer entries.

Insurers and other big organizations are starting to pay for rich directory entries for agents in bulk, Roeser said.

One challenge is that real estate agents already know they have to pay $300 per month for Zillow, but insurance agents still resist paying even $50 per month for a directory entry, the AgentReview CEO said.

But Roeser explained that the attention a review site gets from consumers makes participating in it a great investment. Getting consumers to visit a traditional, stand-alone agency site is difficult, and real estate agencies have found that rich directory entries can increase their level of business by 100 percent to 200 percent, Roeser said.

"Every industry has been able to find one [directory site] that rises above the others," Roeser said.

Agents can already promote themselves through general review sites, but Roeser said he thinks having a review site that focuses on insurance, with an understanding of agents' needs, is better than relying solely on a general-purpose site.

The CEO said, for example, that he now offers an app agents can use to help happy clients provide testimonials quickly and easily — and to get the necessary signatures on release forms, to make sure the agent is complying with marketing requirements that a plumber or lawn service might not have to worry about.

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