Agents Hold Solution To Declining Traditional Long-Term Care Insurance Sales

Insurance agents hold the solution to declining sales of traditional long-term care insurance according to a presentation today by the director of the American Association for Long-Term Care Insurance (AALTCI), a national trade organization.

“Sales of traditional long-term care insurance continue to decline, with 2017 being one of the worst years on record,” explains Jesse Slome, AALTCI’s director.   ”Sales of linked-benefit products are surging and that is good, but linked-benefit LTC is not always the best solution and making sure that a viable market for traditional long-term care exists is essential I believe.”

Slome was sharing thoughts with a group of leading long-term care insurance professionals.  “Traditional long-term care insurers are not going to market the key messages that address the key reasons for declining sales, so it falls to agents to tell the story,” Slome declared.

Cost is a primary concern among consumers, Slome pointed out.  “News media reports show average costs for LTC insurance, typically reflecting a $2,500 to $3,000 range which is accurate for a typical couple,” Slome admits.  “But the consume reading the number incorrectly perceives this is a per-person cost and how many are willing to purchase this protection when the perceived cost can be more than $5,000 a year?  The answer is far fewer than if the cost was $100-per-month.”

A solution Slome recommends where available is to start talking about short-term care options.  “For a significant number of consumers, a policy providing up to a year of coverage will be more than sufficient and certainly far less costly,” Slome advised the group.  “For consumers where cost, age or health is an issue preventing them from applying for traditional LTC insurance, short-term care insurance could be the gateway solution.”

The importance of inflation protection is also critical Slome shared with the group.  “The vast majority of linked benefit products sold today do not include an inflation growth option,” Slome notes.  “That $5,000-a-month benefit sounds extremely meaningful to a 60-year-old buyer today.  The question to ask is what will it pay for in 2038 when you turn 80 and are approaching the age when needing care becomes more likely.”

Pointing out that a traditional long-term care insurance policy with a three percent annual inflation growth option will grow from $5,000-per-month to $8,767 at age 80 and $11,782 at age 90 can be an effective message communicates the AALTCI director.

Consumers and insurance professionals who want to learn more about long-term care insurance costs and planning options call the American Association for Long-Term Care Insurance at 818-597-3227 or visit the organization’s website at to find local LTC insurance professionals.

To learn more about short-term care insurance and find out states where products are approved, call the National Advisory Center for Short-Term Care Information at 818-597-3205.

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