Another Major LTC Player Making Sweeping Changes

[ltcadviser]

I guess as a salesperson this is where the rubber will hit the road. You will have to make decsions in which you have to look at the best interest of your client or the best interest of you family. If a company is paying less commission but may have the better plan, there could be an ethical dilemma as to offer a lesser plan with a higher commission.

I gather you always have this dilemma, but it seems in certain situations it may magnify itself. It's easy to give a good policy that offeres a good commission. However, it may not be as easy to give the good policy with a lower commission.

Interesting.

Actually, you might have missed the point here. The compensation is irrelevant. The differential of 15% means nothing to anyone. It sure doesn't to me. I would give up 25% today of my total Genworth compensation to be able to write Genworth policies as they are priced today; or I would give up 25% of my Genworth compensation today to have the AARP Genworth policy be incorporating the same changes as Privileged Choice Flex.

The problem is the fact that Genworth just took my driver out of my bag and I have to compete on a Par 5 with only 5 irons. The ethical problem is I know for now the AARP Genworth plan is the best policy for a consumer in many situations, and I can't write it.

If you can't write the best policy you might not write any business. I would have Genworth reduce my Genworth compensation by 40% to have kept the status quo.

I hope you understand our recommendations aren't affected by the compensation. Genworth Privileged Choice Flex may or may not be the best option for our clients of the policies we are able to write. If it is we will recommend it; if it is not we won't.

The problem is we make 0.0% compensation if we tell someone to go call 1-800-AARP BY Genworth.

Genworth unevened the playing field. It immediately created one distribution channel that is 15%-60% higher than a second distribution channel.

That is the ethical delimma. We are reduced to being completely OUT of business with full disclosure. I am not in business to be OUT of business but Genworth will not allow me to independently write the AARP Genworth policy.

 

[billberry12]

Ltcadviser,

Chill out friend. It's not the end of the world. Genworth will change the AARP plan ASAP I assure you. Just a matter of time. The AARP
plan is not the best plan on the market in many cases.

Here's a simple solution. If and when the need for an AARP policy arises in the next few months until they change it, simply find a career AARP Genworth agent in the area, and split the deal with the agent 50/50.

Seems fair to me.
Bill

 

[CALTCAgent]

I guess as a salesperson this is where the rubber will hit the road. You will have to make decsions in which you have to look at the best interest of your client or the best interest of you family. If a company is paying less commission but may have the better plan, there could be an ethical dilemma as to offer a lesser plan with a higher commission.

I gather you always have this dilemma, but it seems in certain situations it may magnify itself. It's easy to give a good policy that offeres a good commission. However, it may not be as easy to give the good policy with a lower commission.

Interesting.

There should be no ethical dilemma IMO. You give the client the best policy, period. People shop around, they are going to go with the "best" for them. We make money not just on first year compensation, but by keeping business on the books (residual income). If we don't, we won't stay in business very long.

Work with an independent agent that can shop all of your options. Also find out how long they have been in the LTC business, just IMO.

Example: I have a couple come back at Standard rates. I tell them they were accepted at standard rates, they are happy and were going to take the policy.

I call underwriter and find out why they didn't get preferred. I find out there is a test Dr. wanted them to take and they didn't. Of course because of HIPPA laws it was "whispered to me".

They are going to take the tests and most likely get preferred rates. They are happy and I am happy knowing I have secured the best rating, policy, policy structure on the market for their particular situation.

They would not have been preferred with Genworth/AARP.
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The AARP plan is not the best plan on the market in many cases.

Bill

I agree. Once again why you want to work with an independent agent that can look at all of your options. Each situation is different.

 

[ltcadviser]

Ltcadviser,

Chill out friend. It's not the end of the world. Genworth will change the AARP plan ASAP I assure you. Just a matter of time. The AARP
plan is not the best plan on the market in many cases.

Here's a simple solution. If and when the need for an AARP policy arises in the next few months until they change it, simply find a career AARP Genworth agent in the area, and split the deal with the agent 50/50.

Seems fair to me.
Bill

Well, with my business model it is a little more complicated. The situation might arise 5 times per day.

 

[billberry12]

So...why not refer a prospect to a career AARP agent 5 times a day, and make your customer happy, the AARP Genworth agent happy, and make a little money for your efforts and know you put the client first, as you always do.

Why is this a problem?

 

[ltcadviser]

So...why not refer a prospect to a career AARP agent 5 times a day, and make your customer happy, the AARP Genworth agent happy, and make a little money for your efforts and know you put the client first, as you always do.

Why is this a problem?

Can an AARP agent put a non-AARP agent on the credit line for a split? I have been told "no."

 

[billberry12]

"Can an AARP agent put a non-AARP agent on the credit line for a split? I have been told "no."

I think that's changed. At first one could not, but I believe now, it's a simple form to fill out or something. I'll find out and get back with you.
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ltcadviser,

You are correct, AARP deals can be split, but only between AARP-authorized career agents.

 

[Mr_Ed]

Isn't the AARP policy NOT PQP in most states?

 

[billberry12]

I believe most states do have it approved for Partnership.

 

[CALTCAgent]

Another note about Genworth:

No "First in house" protection. Used to have it for 90 days, but no longer per home office.

Scenario:

I took an application from a lady in May. Today I found out an Ameriprise agent went and took another application for same plan with Genworth end of June. She wanted to keep everything with her new "financial advisor" and through Ameriprise.

Didn't they used to be American Express Financial Advisors?

She never had a financial advisor when we first met.

She was happy with me, until she talked to Ameriprise, the advisor told her only way to keep things "together" with Ameriprise was change agents.

Of course she risks not getting accepted if her health changes.

Note: Genworth has a contract with Ameriprise. Not sure the details. Does anyone know?

Makes me wonder how she got in contact with Ameriprise after I met her.

With the different distribution channels and products they have, I think this "first in house" rule would make me a lot more comfortable with them.