Stand Alone Indemnity Plans.

Apr 16, 2019

  1. ltcadviser
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    ltcadviser Guru

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    It is fixed cost inflation adjusted ltc insurance with return of premium. Sexy as it gets.
     
  2. Mr_Ed
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    I always thought ROP was dumb. When can I get my ROP auto insurance or my ROP home insurance.
     
    Mr_Ed, Apr 17, 2019
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  3. ltcadviser
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    ltcadviser Guru

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    Is it about you or the client? Clients love return of premium for these LTC policies.
     
  4. Mr_Ed
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    Mr_Ed Guru

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    Most of my business comes from people running away from these single-premium hybrids. I keep track of the percentage of my clients who come to me after being shown a single-premium hybrid. Right now it's about 80% of my new clients.

    Yes, Mr. & Mrs. Jones, you can protect yourself from long-term care expenses. Just give us $125,000 each and you'll have about a half million LTC protection.

    Please don't visit LTCShop.com and find out that you can get the same amount of LTCi benefits for only $3,500 per year combined.

    Keep sending 'em my way!
     
    Mr_Ed, Apr 17, 2019
    #14
  5. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    MrEd states:
    ughh... it's not an indemnity plan. only 40% of the monthly benefit can be paid as an indemnity plan. reimbursement works. why would anyone need an indemnity plan?

    Possibly a cash benefit gives a policyholder more options?
    But, for some reason you have never liked any amount of cash as a benefit, whether it be 30%, 40% or 100%.
     
  6. ltcadviser
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    ltcadviser Guru

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    How much annual premium are you writing these days?
     
  7. Allen Trent
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    Allen Trent Guru

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    While I would agree with high net worth clients liking the concept, the guarantees & leverage I don't believe many actually understand the products. If I am not mistaken, the products you mention require you to 1st use your own money by accelerating the death benefit before you can access the LTC linked pool of funds. So, most people that have a short stay before death would be merely accessing their own money. not a bad thing because without such a policy they would also be paying their own way.

    the problem is too many believe it to be just like stand alone LTC. in some cases they could buy a EIA with the lump sum & use the Guaranteed WD benefit to pay for a stand alone LTC policy.

    Again, not knocking that the product version doesnt serve a purpose, just that most consumers & many agents believe or sell it as superior to stand alone LTC
     
  8. yankee466
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    yankee466 Guru

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    Convincing some people that Hybrids are good is like trying to convince a Democrat that Trump did not collude with the Russians. Sell what you believe in, whatever the client wants.......and just move on. :biggrin:
     
  9. ltcadviser
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    ltcadviser Guru

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    Allen,

    It is just an alternative solution to funding inflation adjusted LTC insurance. Not better/worse. Just an alternative funding solution.

    You can write a check for a linked benefit policy for example $100,000, or you can buy a traditional policy and pay $4000 non-guaranteed annual premiums for life.

    Either way, at age 87 you are using your premium for a short term need with either type of policy; whether you paid annually for 25 years with no guarantees on the annual premium; or you stroked a check.

    Sure there is an opportunity cost on the premium for the hybrid policy; in the same respect there is rate increase risk on traditional policies. Regardless as to what some LTCI salespeople might have you believe.

    We find that most HNW clients just want the guarantees.
     
  10. ltcadviser
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    ltcadviser Guru

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    By the way, if your client no longer cares about indemnity then Mass Mutual still has its Signature Care 500 policy available in Florida and its priced the best in Florida. The policy might not be around in Florida for much longer, however, as it was replaced in 39 states already so you should move quickly.
     
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