1. LTC Insurance Sales “Disrupted” A New Approach to Selling LTC Insurance
Steven M. Cain, CLTC®
Director | Sales & Business Development
LTCI Partners, LLC
(818)

2. Excuses…excuses Why don’t advisors sell or consumers buy?
Consciousness at an all-time high
Greatest risk to retirement is healthcare…specifically, Long-Term Care

3. Industry Update What have we learned? Tougher underwriting
Gender-based pricing (all carriers)
Rising interest rates help long-tail products
Most conservative actuarial assumptions industry has seen (use IDI analogy)
Recent SOA pricing analysis – 10% chance of premium increases on today’s business…and increases are likely to be around 10%

4. What’s the Best Fit?
What are you and the client trying to accomplish? This dictates the product recommendation or solution.
At LTCI Partners, we’re not “purists” – there are now MORE options to plan for Long-Term Care

5. Typical Components of the LTC Insurance Pitch
Describe THE PROBLEM
Describe THE RISK AND THE COST
Describe THE POLICY
Behavioral Finance – each component of the “old sale” is totally undermined by our decision biases
People aren’t rational
Avoid stats – they destroy empathy
Stories & emotions are critical
Appeal to the consumer as smarter than their peers
Focus on an easy process

6. How to Influence Decisions
Principles of Persuasion
Strategy or Talking Points
Reciprocity
When you offer something first (new product, planning strategy, article, webinar replay, etc.), people will feel a sense of indebtedness, which will make them more likely to comply with your subsequent requests. We’re deeply wired to be reciprocal.
Scarcity
We’re always drawn to things that are exclusive or hard to come by (think about open enrollments & Multi-life LTCI, “fire-sales” and product changes).
Authority
We follow people who look like they know what they’re doing. Leverage your professional designations, share that you focus on retirement planning & healthcare and that Highland has a team of Long-Term Care planning consultants, etc.
Consistency
We tend to stick with whatever we’ve already chosen. The principle is to make the client commit to something (a statement/stand/identity) -- they will then feel an automatic compulsion to stick with it.
Liking
“I love North Dakota this time of year.”
We are more likely to comply with requests made by people we like -- that can range from our closest friends to complete strangers. We trust word-of-mouth recommendations from our peers.
Consensus or “Social Proof”
We tend to have more trust in things that are popular or endorsed by people that we trust (experts, peers, users, celebrities & crowds). “The average premium we’re seeing people spend is $2,200/year.” Or “we see many clients doing this…”

7. Now What? Tips for Discussions…
Keeping choices as simple as possible
Focus on the possible gain LTC will provide instead of the possible loss
Use stories, not statistics! 
Focus on now benefits, not the future
Help Guide Heuristics (“rules of thumb”)
Force a choice
Keeping choices as simple as possible.  As an advisor, you may think your job is to give a possible buyer multiple options for planning for care, such as spread sheeting several insurance carriers or comparing standalone and linked products.  However, the reality is consumers don't want this - they want a recommendation with just a few choices.  Limit the options they can consider.
Focus on the possible gain LTC will provide instead of the possible loss.  Gamblers fell worse about losses than good about wins. Likewise, people who are considering LTC Insurance don't want to think about loss when planning for care, such as how their retirement savings may be depleted.  Instead, try and focus on the fact that a small LTC Insurance premium gives the policyholder the possibility of a BIG payoff in benefits.  For example, a $2,000 annual premium could result in $300,000 to pay for high-quality care ah at home.
Use stories, not statistics!   Statistics are important for discovering trends and insights, but they are awful when used for discussing LTC planning.  Statistics destroy empathy and emotion.  People are way too optimistic about their future and think they will be on the winning side of a statistic.  Focus on stories and experience when talking about planning for LTC.
Focus on now benefits, not the future.  It's incredibly hard for people to imagine aging and needing help.  Only something like an aging suit can really give people a glimpse of how needing care will affect them and their families.  Instead, focus on the "now" benefits  of LTC Insurance.  The now benefits for LTC Insurance are harder to quantify, but they can include peace of mind, good health underwriting, and locking into a lower premium before a birthday.
Help Guide Heuristics (rules of thumb). For analytical advisors, it's tempting to use tools such as cost of care surveys that project the cost of care 40 years in the future when designing plans.  A better approach is to "follow the crowd" and recommend benefits similar to what policyholders are actually buying.  You may think that people want customized solutions, but most would feel more comfortable picking options similar to other buyers.  Recommend they do what most people are doing.
Force a choice.  When people have to make a decision, such as actively signing off the fact they have been offered LTC insurance but declined, they will be more likely to buy.  LTC planning is easy to delay, and people don't want to be told they can't delay that decision forever

8. Tax Treatment of LTC Insurance
Multi-life opportunities
IRS Code Sections:
7702B – defined Qualified LTC (accident & health insurance / tax-free benefits)
162 – ability to deduct accident & health insurance (c-corp owners are treated as employees)
213 – age-based deductibility for pass-through entities (s-corps, LLCs or LLPs)
106 – premium is not included /counted as imputed income  
Treasury Regulation – employer can create a class of select employees to offer this coverage to (ability to carve-out or “discriminate”)
IRS Notice , Q and A41 (HSAs) – tax-qualified LTCI premiums are a qualified medical expense. As a result, an individual may withdraw money tax-free from their HSA to pay tax-qualified LTCI premiums
IRS CIRCULAR 230 DISCLOSURE: Pursuant to requirements imposed by the Internal Revenue Service, any tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code or promoting, marketing or recommending to another person any tax-related matter. 

9. LTC Sales & Brokerage Support
ADVISE
Fact-finding
Field underwriting
Plan design consulting
Product recommendation
Competitive analysis
IMPLEMENT
Virtual point-of-sale-support
Application fulfillment service
Case management
SERVICE
Policyholder service and support
Rate increase consulting
Highland LTC
(844) , Option 3