We Need To See The Numbers/Premiums First......

[yankee466]

having a hybrid policy is better than having no policy.
having a traditional policy is better (usually) than having a hybrid policy.

The actual cost of the single premium hybrid policy is the opportunity cost PLUS the entire single premium (because if they need care, their single premium is used to pay for their care).

A hybrid is like having a two-year or a three-year elimination period on a traditional LTCi policy.

yes...but so is paying into a traditional plan for 20-30 years before you use it.....they still have a lot of your money, albeit a little at a time.

 

[bluemarlin08]

Don't you have lost opportunity cost on traditional policies plus the "loss' of the non guaranteed premium?

 

[Mr_Ed]

yes...but so is paying into a traditional plan for 20-30 years before you use it.....they still have a lot of your money, albeit a little at a time.

I'll do the math for you later.
I don't have time now.

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Don't you have lost opportunity cost on traditional policies plus the "loss' of the non guaranteed premium?

"non guaranteed premium"...gimmeabreak.

#1) Some hybrids are NOT guaranteed, were you aware of that?

#2) are you aware that for LTCi policies purchased in TN since 2004, in order to get a rate increase the insurance company has to decrease their profits?

 

[bluemarlin08]

I only use the guaranteed. Back to my question though, aren't those lost opportunity costs? Do you tell your clients about potential rate increases?

 

[Mr_Ed]

I only use the guaranteed. Back to my question though, aren't those lost opportunity costs? Do you tell your clients about potential rate increases?

of course I tell them about potential rate increases....geez.
don't you tell your clients about Tennessee's Rate Stability Regulation and how it penalizes an insurance company if they have a rate increase?

 

[bluemarlin08]

I tell them rates are not guaranteed. Are you not going to answer my initial question? Geez, as you say.

 

[Mr_Ed]

I tell them rates are not guaranteed. Are you not going to answer my initial question? Geez, as you say.

Assuming a 2% interest rate, the opportunity cost of a $100,000 single premium is $2,000 per year EVERY YEAR!

That means the $100,000 single premium has the same opportunity cost as a policy that has a $2,000 annual premium.

The difference is when you need to make a claim. With the traditional, you pay the first 90 days. With the single premium hybrid, you're paying for the first 2 to 3 years.

And, in most cases, the traditional policy is going to have a higher monthly benefit, a better inflation benefit, and a longer benefit period.

And if interest rates go up, the opportunity cost of that $100K single premium will be even worse.

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I tell them rates are not guaranteed. Are you not going to answer my initial question? Geez, as you say.

don't you tell consumers about Tennessee's Rate Stability Regulation and how it penalizes an insurance company if they have a rate increase?

 

[kpbdy99]

Just give them a sample plan, show them the cost. If they're serious shoppers, they already have a rough idea, and they'll still talk to you. If they pitch a fit at the sample, they were never going to buy anything anyway, and it's better you know that now than after meeting with them two or three times.