By following just five steps, a producer can set the stage for successful sales. The typical sales cycle of an executive LTC program is three months or more, so patience and organization is key. The great news is that successful sales result in significant premium, typically $50,000 to $100,000 annually – and the compensation is well worth the effort.
Step One: Initial conversation and gathering of census information. The mutual interest in an executive LTC program will have to be established. As stated before, generally the tax breaks and wealth protection will incite an employer to budget for a plan. Census information of the covered class, including spouses, should be gathered. Generally, the only information needed includes names, annual compensation, home zip codes, and age.
Step Two: Obtain preliminary health data. At this point, the carriers who offer simplified underwriting can be narrowed down based on the number of eligible participants. Health surveys can be conducted, either through paper or more effectively using Web-based survey tools. Make sure that all potential applicants respond to the series of health questions, but it is important to gather the information anonymously to avoid privacy concerns.
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Step Three: Decide plan benefits. With good underwriting data, plan benefits can be chosen and multiple carriers can be quoted. Often, the plan quoted will be the maximum benefits available under the carrier's simplified issue program – for example, a $6,000 monthly benefit, five-year benefit period, and a 90-day elimination period. A choice between cash and reimbursement policies can be chosen at this point.
Step Four: Present recommended solution. Once rates have been calculated with the assistance of a managing general agent or carrier software, a proposal should be generated. A great approach is to customize the presentation for the particular employer. The sections of the presentation can include reinforcement and verification of the decision to provide the benefit, the steps that went into research options, and the recommended solution. Depending on preference, one carrier can be recommended or the client can be given a choice of two carriers for them to decide. At this stage, however, the benefits should have been agreed upon (step 3) and the choice should be only the carrier.
Step Five: Enroll. The enrollment step is the most critical, because carriers will give only a 30- or 60-day enrollment window. Since LTCI applications are individual contracts in most cases, the applications are long. Try to enlist the assistance of carrier resources or a managing general agent for assistance. Electronic enrollment is available from some carriers and on the drawing board of all.
A properly sold executive LTCI case can provide a wonderful benefit to the families of executives and a new income opportunity to the advisor. In addition, it can provide a recurring stream of prospects for the producer.
Tom Riekse Jr., CEBS, ChFC, is a managing principal at LTCI Partners, Libertyville, Ill., a nationwide brokerage agency. LTCI Partners offers marketing, sales and administrative support, as well as a wide variety of long-term care products from the nation's largest and most-respected carriers. For more information, visit www.ltcipartners.com or call 800.245.8108.
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