LTCI vs. Linked Benefits – Which One When?
By: Bob Vandy, CLU, ChFC, LUTCF, CLTC
February 5, 2015
Earlier today, we held a very successful webinar with the above title, co-presented by myself and Marketing Director Dave Michalski. I say very successful because both our reservation and actual attendee numbers were twice what they normally are for our training webinars.
How do I account for such increased interest? Well, there may be many reasons – recent volatility in the traditional LTC (Long-Term Care) Insurance market, increased availability of life products with LTC or Chronic Illness riders, and more.
The other thing that I believe the increased interest tells us is that two of our suspicions are correct; namely – number 1, that agents and advisors are recognizing that, despite the volatility of traditional LTCI, the NEED for planning is more important than ever and – number 2, that training our agents and advisors on the nuances of the various LTC Insurance product solutions – so they can make the appropriate recommendations to their clients – is critical.
We’ve all heard the statistical rationale for planning in advance for an unexpected (aren’t they always?) LTC event. The chances of needing LTC services is greater than most any other risk we face in life. Yet, historically not a high enough percentage of people in the U.S. have purchased LTCI – in one form or another. That needs to change, and we are starting to see it change.
The main message of our session today – which you can listen to and view at this link – is that there is no one “best” insurance solution to our clients’ and prospects’ LTC planning needs. In some instances, a traditional LTCI policy may be the best fit, and in others a solution that combines a life insurance or (where available) annuity base with a LTC (or “Chronic Illness”) benefit rider makes better sense.
Traditional LTCI offers a number of advantages, including the most comprehensive LTC benefits (including inflation options), income tax incentives (for both individuals and business owners) and the potential for Partnership LTC asset protection.
Linked products also offer their share of advantages, including an instant answer to the potential client concern of “what if I never use it?” (LTC benefits), a potentially “simpler” process and product to explain and the ability to combine LTC planning with broader estate & legacy planning by virtue of both the LTC/Chronic rider and the ultimate life insurance death benefit. Some products even provide a return of premium rider that allows the client to get his/her premium back if they walk away from the policy later without having used any of the benefits.
Ultimately, clients and prospects must determine which product solution best suits their needs. Our job at National-New York Long Term Care Brokers is to help our affiliated agents and advisors find the right product fit – based on affordability, ability to health qualify and overall planning goals and objectives – for those clients and prospects.
Let us help you find that right fit today!