How is the Best Way to Do a Large "Stop Loss" LTC

kennethbroyles

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I met with a GA couple yesterday and after putting a pretty typical JH $150/day, 90 day elimination period $249k max benefit , $4359/yr for this very healthy , both 64, NT, well built ,husband on RX for HBP only Meds. Here are the notes after meeting. What would you offer?


1. They want LTC protection as a "stop loss" after some significant amount paid by them, with a much higher higher "Benefit Pool." I also discovered that a lower "stop loss " might be OK. He said the reason he used that number was because it was the "Maximum Benefit" on that JH policy, and it worried him more for cost above that $200K amount on up to $1M or so.

2. XXXX told me she had talked to a friend, who's LTC allows unused benefits form a spouse goes to the surviving spouse.

3. He he didn't really answer when I asked why he wanted that protection above that "stop loss". Legacy goals for family or charity I suppose; or maybe fear of living to long. I don't know. I pushed as far as I could, at the time, to discover that answer.

I just remembered, he said to me "It seems, if a insurance company has someone willing to pay, where the most risk usually is, why wouldn't they want to offer something at a reduced price for coverage over that amount?"

I don't do a lot of LTCi, and was wondering how more experienced brokers would handle this case.

Thanks in advance for all helpful suggestions.
 
I met with a GA couple yesterday and after putting a pretty typical JH $150/day, 90 day elimination period $249k max benefit , $4359/yr for this very healthy , both 64, NT, well built ,husband on RX for HBP only Meds. Here are the notes after meeting. What would you offer?


1. They want LTC protection as a "stop loss" after some significant amount paid by them, with a much higher higher "Benefit Pool." I also discovered that a lower "stop loss " might be OK. He said the reason he used that number was because it was the "Maximum Benefit" on that JH policy, and it worried him more for cost above that $200K amount on up to $1M or so.

2. XXXX told me she had talked to a friend, who's LTC allows unused benefits form a spouse goes to the surviving spouse.

3. He he didn't really answer when I asked why he wanted that protection above that "stop loss". Legacy goals for family or charity I suppose; or maybe fear of living to long. I don't know. I pushed as far as I could, at the time, to discover that answer.

I just remembered, he said to me "It seems, if a insurance company has someone willing to pay, where the most risk usually is, why wouldn't they want to offer something at a reduced price for coverage over that amount?"

I don't do a lot of LTCi, and was wondering how more experienced brokers would handle this case.

Thanks in advance for all helpful suggestions.


It sounds like he wants a policy with a lifetime/unlimited Benefit Period and a very long elimination period.

Since he lives in Georgia, he can't get a very long elimination period (I think 180 day ep is the longest I've ever seen approved by the GA DOI.) But you can give him a lifetime/unlimited benefit period from, to name a few, Berkshire, Genworth, Mass Mutual, Mutual of Omaha, Transamerica, United of Omaha.
 
I met with a GA couple yesterday and after putting a pretty typical JH $150/day, 90 day elimination period $249k max benefit , $4359/yr for this very healthy , both 64, NT, well built ,husband on RX for HBP only Meds. Here are the notes after meeting. What would you offer?


1. They want LTC protection as a "stop loss" after some significant amount paid by them, with a much higher higher "Benefit Pool." I also discovered that a lower "stop loss " might be OK. He said the reason he used that number was because it was the "Maximum Benefit" on that JH policy, and it worried him more for cost above that $200K amount on up to $1M or so.

2. XXXX told me she had talked to a friend, who's LTC allows unused benefits form a spouse goes to the surviving spouse.

3. He he didn't really answer when I asked why he wanted that protection above that "stop loss". Legacy goals for family or charity I suppose; or maybe fear of living to long. I don't know. I pushed as far as I could, at the time, to discover that answer.

I just remembered, he said to me "It seems, if a insurance company has someone willing to pay, where the most risk usually is, why wouldn't they want to offer something at a reduced price for coverage over that amount?"

I don't do a lot of LTCi, and was wondering how more experienced brokers would handle this case.

Thanks in advance for all helpful suggestions.

I would start by NOT showing them a pricey Hancock plan. Suggest you show a shared plan....as it plays the odds well. A 10 year shared plan is not that that much more than two separate 5 year policies with the right carrier

In Georgia, you can actually go to 365 day elimination period with some carriers (most are only 90)....as the rules have changed with some of the newer plans available in the state. That saves a little money.

Hope this helps....else suggest you solicit help from someone who specializes in LTC options.
 
Not sure about GA, but Genworth Classic Select offers a 365 day elimination period in Mississippi. You might want to check on this. I agree. Unlimited with 365 elim would probably work. The rates for unlimited versus say 6-8 year BP are less that you think. Also, his wife is referring to shared. This can be done on this policy too, with up to a 120 month shared mutiplier with a 365 elim. One of these should make them happy. Hope this helps.
Bill
 
I suggest you consider partnering with Herman Bruns as he's in Atlanta. Knows LTC backwards and forwards.

You know he'll do what's right for your client and you'll gain some valuable knowledge.

Rick
 
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