Long Term (not So Rare) Care

Oct 18, 2011

  1. bobwise23
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    bobwise23 Super Genius

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    Hello fellow Threaders and Posters,

    Recently i acquired my Life Insurance producer's license. Immediately after i got back from receiving this, it was recommended to go for Health Insurance and get a LTC certificate. This sounds like a very huge market considering the baby boomers, and Medicare(weather they cut back on coverage or not).I figure this would really add diversification to our business. Can anyone inform me about the commission and success rate? Also, anyone in the business have good advice on going into this market would be much appreciated.

    Thank you fellow bloggers

    www.thirdlakefinancialcorporation.com
     
  2. sluggo08
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    sluggo08 New Member

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    It can be a great market. Just be ready for your biggest competitor....client denial! LTC sounds great to most people, until they see the premium...then they start talking about all the ways they can get around buying it!
     
    sluggo08, Oct 18, 2011
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  3. CALTCAgent
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    CALTCAgent Guru

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    1. What do you want to be informed on in particular about the commission?

    2. Success rate of agents? (Its very low, generally speaking.)
     
  4. Mr_Ed
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    Mr_Ed Guru

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    Unless you have a passion for LTC insurance, you will not succeed in it.
     
    Mr_Ed, Oct 18, 2011
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  5. bobwise23
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    bobwise23 Super Genius

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    As far as an average premium with a normal product. Is it similar to Life Insurance commission?

    -Bob
     
  6. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    Depending upon the product, carrier and the amount of business that you do, first year's comp ranges from 50% to 70% and renewals range from 4% to 8%.
     
  7. ltcadviser
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    ltcadviser Guru

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    Term life, universal life or whole life?
     
  8. bobwise23
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    bobwise23 Super Genius

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    Either Term Life or Universal life is what i am looking for.

    -Bob
    - - - - - - - - - - - - - - - - - -
    Either Term Life or Universal life is what i am looking for.

    -Bob
     
    Last edited: Nov 21, 2011
  9. ltcadviser
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    ltcadviser Guru

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    Well, as you know most term life insurance and UL commissions are front-loaded. So, of course there is a range depending upon carrier, hierarchy and amount of production but life insurance FYC is typically between 80%-120%; however renewals are minimal; often times 0% on term; 1%-3% on UL.

    As Arthur correctly mentioned LTC offers between 50%-80% with renewals between 5%-10%. Some companies drop the renewal % in years 11+; some don't. Again, it depends upon carrier, hierarchy, and production. LTC compensation is most similar to disability income compensation.

    So, in the long run an LTC policy can pay more compensation on a percentage basis than a life insurance policy due to the renewals and the persistancy.

    However, an LTC policy almost always will be "one and done." A replacement is virtually impossible and never in the policyholders best interest if the initial policy was done correctly.

    With life insurance, multiple sales over a client's lifetime is the norm, due to changes in the insureds needs, personal and business coverage, estate planning, etc.

    So, the bottom line I guess is both products compensate the agent fairly, although in slightly different ways.

    My best advice is to cover all protection bases for your clients---life insurance and disability income, and long term care planning. The compensation, whatever it is, is just a derivative of the work and advice you provide.

    Bob, I don't believe you will have a problem succeeding with LTC. If you are comfortable protecting your clients' income and assets with life and disability insurance, protecting a nest egg LTC will be easy for you. The only mental challenge with LTC is the decline rate. With life insurance, the UW will offer a table rating; with DI the UW may place an exclusion within the policy; With LTC, an impaired risk is often declined. To me, that might be the biggest challenge initially. Once you are comfortable with the morbidity UW, you will do fine.

    Best of luck.
     
    Last edited: Nov 21, 2011
  10. Frank Stastny
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    Frank Stastny Guru

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    I use to sell a lot of LTCi. Toughest insurance product I have ever sold.

    In addition to "denial" the biggest hurdle I constantly ran into was the prospects selfishness. More often than not they would say something like, "my kids love me, they would never put me in a nursing home".

    My response was, "I love my kids, I would never want to destroy their quality of life by making them stay home all day every day and have to change my dirty diapers". They very seldom had anything to say after I said that.
     
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