LTC for the Super Wealthy?

[0b1kanobee]

The fact of the matter is that most advisors (CPAs, Financial Advisors, Money Managers, etc) just don't understand the product.

They don't comprehend the financial impact of a LTC event on their clients and they also don't want an insurance agent talking with a client of theirs. They are all very protective of their book of business.

But with that mind-set, they are doing their clients a disservice.

I agree which is why I think it is much easier to sell LTC by working with advisors rather than banging their client on the side. Build relationships and gain the trust of some advisors and you won't have to pitch LTC. A guy in our office works this way and he is one of the top LTC people in the state. Mention his name and LTC in the same sentence with folks in the know and they know who he is. He just works with other advisors.

 

[Franz Kafka]

I had a conversation on the phone yesterday with someone who had requested information on LTCi. They told me that their "Money Manager" told them that they do not need LTCi. They had enough money and could self-insure.

Yes, they all have these "money managers" whose mission in life is to eradicate the earth of all insurance-related products. None of them really know how to "manage money" (they all split their fees with SMAs). I don't know of any of these guys working together with insurance agents, either. It's a tough battle when the clients have been with them for many years unless you've got some letters after your name.

 

[briko3]

This is easy. Find the PAIN:

The sad reality is they have kids that look at that money as their inheritance and retirement plan. When that happens, that nice nursing facility is seen as eating into THEIR retirement and there is resentment. In some cases the parents end up in "not so nice" places.

LTC insurance is a way to insure they end up in a nice place without the kids worrying about their inheritance.

It's on every wealthy person's mind, so poke it with a stick and you should get some nice LTC sales.

 

[0b1kanobee]

This is easy. Find the PAIN:

The sad reality is they have kids that look at that money as their inheritance and retirement plan. When that happens, that nice nursing facility is seen as eating into THEIR retirement and there is resentment. In some cases the parents end up in "not so nice" places.

LTC insurance is a way to insure they end up in a nice place without the kids worrying about their inheritance.

It's on every wealthy person's mind, so poke it with a stick and you should get some nice LTC sales.

Spot on!

LTC just might be the reason they have an inheritance left. Think also of the costs with time lost from work, the worry if your parents are being taken care of properly and lost income that could result.

Every person also has a degree of larceny. That's what you put into the children's mind.

The rich like to be able to choose or have choices. "Mr. Smith, when you are receiving care and you ask for ketchup, would you prefer generic ketchup like they serve to incarcerated people or Heinz, perhaps even vein ripened? The latter of the two choices gives you a LTC prospect. They want choices.

"Mr. Smith, if we could carve out 5% of your nest egg to assure you always have the choices you are accutomed to....." THEN draw a big pie circle showing the small percentage.

 

[briko3]

Spot on!

LTC just might be the reason they have an inheritance left. Think also of the costs with time lost from work, the worry if your parents are being taken care of properly and lost income that could result.

Every person also has a degree of larceny. That's what you put into the children's mind.

The rich like to be able to choose or have choices. "Mr. Smith, when you are receiving care and you ask for ketchup, would you prefer generic ketchup like they serve to incarcerated people or Heinz, perhaps even vein ripened? The latter of the two choices gives you a LTC prospect. They want choices.

"Mr. Smith, if we could carve out 5% of your nest egg to assure you always have the choices you are accutomed to....." THEN draw a big pie circle showing the small percentage.

Unfortuanately kids of the rich can be greedy and might take those choices away in order to "save their inheritance". A lot of kids don't save for retirement thinking they will get the inheritance one day. How stressed would you be if that was you and you saw your mom in a nursing home for $75,000 a year. All of a sudden your retirement and all that debt you have will start to weight pretty heavily on you.

 

[0b1kanobee]

Unfortuanately kids of the rich can be greedy and might take those choices away in order to "save their inheritance". A lot of kids don't save for retirement thinking they will get the inheritance one day. How stressed would you be if that was you and you saw your mom in a nursing home for $75,000 a year. All of a sudden your retirement and all that debt you have will start to weight pretty heavily on you.

Exactly and that is why the LTC can be appealing to the children. It protects those assets.

 

[yankee466]

Back to some of the better LTC agents thinking that products like Moneyguard or TLC is simply not a good value.....keep in mind that the wealthy people are into estate planning.

Estate planning usually includes significant life insurance policies...hence the tendency to think MG or TLC. (which I also think are very expensive life plans)

Instead of these "rip off" life plans with LTC benefits like MG or TLC, you can always offer to sell them a much more cost effective permanent UL life policy, such as Protective Life's (WCL) UL product with "extend care" rider. True, it is no more than an accelerated death benefit (paid in cash by the way, with no receipts needed), but you are able to purchase a huge amount of death benefit and still pay monthly ( or annually or 10 pay or single pay) if you like....as opposed to MG or TLC where you have to part with huge sums to only maybe double the premium into a death benefit. It does not tie up large sums of money in a life plan, and it maximizes asset transfer to heirs. If they need LTC, the plan can write them a nice check every month, and while on benefit, they do not have to keep paying for the life insurance. If they need more LTC than the plan can provide, they can simply pay cash for it....as selling them on the aspects of a partnership eligible LTC plan is likely a waste of everyone's time.

Of course, you still have to get past the point of them paying something extra for the rider, but it is not as bad as what you actually have to pay for MG or TLC.

Just a thought. That's my take on the subject when LTCi is not going to fly. Of course these people usually will already have all the life insurance they need in place....so u can can look at 1035s where appropriate.

Luckily, I never seem to talk to very wealthy people...as I much more enjoy trying to get blood out of a stone.

 

[billberry12]

"Luckily, I never seem to talk to very wealthy people...as I much more enjoy trying to get blood out of a stone."

I think most of us fall into this category in the grand scheme of things.

 

[Arthur Rudnick]

Bill,
This is obviously not my normal group of prospects.

This opportunity came out of left field and I'm feeling my way through it. These are a group of very wealth people, many with assets over $20 million.

Here's a very interesting comment from a member of the group who is coordinating the webinar.

"One of our members has a net worth of $20-$25 million dollars. Her mother had Alzheimer's . They sent her to some facility in Costa Rica to reduce costs. She is a strong proponent of LTCi and I'll use her as an endorsement."

What do you think about that statement?

 

[billberry12]

I think you need to talk to this lady that is an endorsement. Get her to tell you why she feels LTCI is great. Use her story with her permission.