Article 3 - National Underwriters Article
Agents Put It Bluntly: Get Serious About LTC, Or Don't Bother
Reproduced from National Underwriter Life & Health/Financial Services Edition, January 15, 2001. Copyright © 2001 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.
"If you want to dabble around selling long-term care insurance, well, good luck!" That wry comment from Neville Verster, principal of LTC Insurance Solutions, a Fountain Hills, Ariz., LTC agency, expresses the thinking of every LTC marketer contacted by National Underwriter for this article.
Each was asked, what do agents need to do to make LTC sales soar? Every single one said the agent has to commit the time and energy to learn about LTC. "If you don’t, chances are very high you will guide the client incorrectly," cautions Julie Hurst, director of marketing and sales for LTC at MarketShare Financial, an Indianpolis exclusive producer group.
It’s not just product and features education that’s needed, stresses Susan Nastasi, regional sales manager in the Orlando, Fla., office of ACSIA Insurance Services, a LTC specialist firm. LTC agents also need to know how to get appointments, what happens during the appointment, how to do an LTC needs assessment, and how to to sell to each client’s needs and risk concerns.
"Product training is secondary to training on needs identification and risk assessment," Nastasi says. "In client interviews, agents must find out the client's health and financial situation. They also must find out what the client is trying to protect, and the reasons the client is interested in buying LTC."
Agents who start talking about product features, before ever doing this groundwork, will have a hard time interesting prospects in LTC, Nastasi insists. "You need to find the urgency, how the client can benefit."
Many people already know why LTC coverage can help them, "but they can’t see the big picture," contends Robert McCumber, a MetLife financial services executive in Waltham, Mass., who sells individual LTC. For instance, he says, they already know that:
- Baby boomers are aging, so the retirement population is growing, putting stress on Medicare and other government programs.
- Boomers often own large homes and retirement assets, so they don’t qualify for Medicaid and welfare programs in the event of LTC.
- Adult children often don’t live nearby and/or adult daughters have careers, so younger adults can’t always care for their parents.
"The agent needs to remind people of these things they already know," McCumber says. This will help them see they have something to lose--something LTC insurance can help protect. He spends the entire first interview addressing these points with clients and leaves behind a buyer’s guide and a book on LTC for further perusal. In the second visit, he answers questions, shows proposals from three insurers, and moves toward helping clients find "the best fit."Even clients who have studied up on LTC insurance require the guidance of an informed agent, adds Verster, the Arizona producer.
"They may have lots of knowledge," he explains, "but they don’t have the solution. "They need an agent with sophisticated and deep knowledge of the industry to assist them in prioritizing benefits and finding the best value."
The problem in today’s market is many producers still don’t know as much as they should about LTC products, markets, and clients’ needs, says Hurst of MarketShare.
For instance, "most do not know the rules for Medicare and Medicaid in their area," let alone how to use LTC in advanced planning, she says. Inadequate knowledge can be a "big obstacle," she says.
So, what can be done to remove that obstacle?
For one thing, agents need to take the initiative, says Brian Schroeder, president of Jack Schroeder & Associates, Green Bay, Wisconsin. They can’t rely on the companies to educate them, he explains, "because today, only a few insurers provide more than a small amount of LTC education." However, education is available, he and others say.
For instance, some LTC sales firms now provide LTC specialists on staff to support the agents in the field, says Hurst. (She herself does this, providing agents with education materials, selling tips, advance planning support, articles, fliers, and one-on-one chats.)
Also, some LTC insurers are sending LTC wholesalers into the field to teach agents about products and ideas, in much the same way that annuity wholesalers promote annuity products, Hurst says.
Third-party providers are also becoming a good source of agent education, says Schroeder. These are for-profit firms that offer a wide assortment of LTC tools, including selling systems, LTC seminars, trade magazines, Web sites, etc.
"You can also learn a lot from good marketing general agencies and brokerage firms," Schroeder says.
Yes, he concedes, LTC products are complex and evolving, but learning about them and the business "is not rocket science."
Even brand-new agents can become self-educated, he says, by reading third-party materials, company materials, information on the Internet. "Some agents can be penny-wise and pound-foolish about this," he says, noting "they will argue over a few points of commission, but not spend the time, effort or money to get educated, or even to take advantage of the free education they can get."
Getting educated can be a Catch-22 for a start-up agent, who is trying to learn and sell LTC at the same time, Verster allows. But "it’s unlikely you’ll sustain yourself or your clients for very long if you don’t find a way to make it work," he says.
What if an agent sincerely wants to sell LTC, but isn’t yet proficient enough to do so? "Set up a strategic partnership with an LTC specialist to whom you can refer cases," suggests Verster. But even when partnered with a specialist or well-educated themselves, agents need to observe practices that assure "iron-clad" protection in event of a lawsuit, Verster cautions.
His suggestions: Buy errors-and-omissions insurance; track and document client meetings and agreements on contact management software; and require clients to sign off on the choices they make. Agents lacking a long-term perspective on the business don’t do these things, Verster says. But in 10 or 20 years, when clients start objecting to certain claims decisions, they’ll wish they had.
All producers contacted for this story agree the biggest tip of all is: If you learn how to help clients solve problems, you’ll solve another problem, too—i.e., how to make LTC sales take off.
posted/updated
22 Jul 2002
author:Linda Koco
