• Age and/or stage in life
• Income/Assets/Premium paying ability
• Dominant risk management need
• Health conditions
• Pertinent insurance or risk management programs currently in place

Helping consumers plan for risks they face requires that you ask some basic “information” questions.  “Fact-finding” need not be an onerous or lengthy process.  It’s most central element is having a conversation with a consumer to determine their world view on what’s important to them. Their opinions will inform your recommendations.  That being said I can offer some general “rules-of-thumb” which you may find useful.

1. Anytime you present term or universal life insurance to a client they should consider a program with an accelerated benefit rider for chronic illness. American General Life & Accident Insurance Company Quality of Life ….^SM Insurance products include this at no additional cost.  Accelerated benefits can also be elected in the event of critical and terminal illness.  This opens a world of planning options for you and provides the policyholder with more choices if an untimely event occurs.
   • By the way, today is your last chance to register for our first AGLA training web broadcast on April 26^th.  CLICK HERE — or paste this URL https://www1.gotomeeting.com/register/594050065 into your browser for details and registration page.
2. Traditional long-term care insurance policies are exceedingly appropriate for consumers from their late 40′s through mid-60′s.  Business owners can take advantage of tax deductible premiums, tax-free benefits and simplified issue with as few as 7 employees.  Clients with the premium paying ability to solve multiple risk management issues with various products are well served by LTCi’s high benefit-to-cost relationship.
   • At the risk of belaboring a point, I’d like to reiterate that we are in fire sale mode with a number of our key long-term care insurance carriers.  We expect significant new business premium increases, particularly as it relates to 5% compound inflation protection, in the foreseeable future.
3. Single premium linked life product sales have been seen a marked increase over the past few years.  Typical of this sort of product are Genworth’s Total Living Coverage and Lincoln Financial’s MoneyGuard.  Consumers that consider these long-term care planning vehicles are generally older (60+), have considered traditional long-term care insurance and decided against it, and have invest-able assets close to $1,000,000.  Often they have set aside “safe money” in a CD as a hedge against a chronic or serious illness. This allows you to leverage those dollars in another safe vehicle that provides life and long-term care benefits.
4. A number of annual pay universal life insurance products now offer chronic illness ABR’s for relatively low cost. Our favorite is from Nationwide Insurance.  If a client is looking for a low cost UL with secondary guarantees why not provide them with the ability accelerate some or all of their death benefit in the event of a long-term care need?

There are other insurance products that include long-term care planning solutions; here’s a “sneak preview” of what you can expect in the coming months:

• Principal Financial’s non-can disability product, geared for the professional and white collar market, can include coverage for catastrophic disability, which is defined as the inability to perform two of six of the activities of daily living or suffering from a severe cognitive impairment.  This low-cost rider allows the insured to indemnify nearly 100% of their income should they suffer a catastrophic event.
• State Life offers a long-term care planning solution that allows clients to utilize money “locked-in” qualified accounts.  We have experts on staff that can guide you through this planning process. Contact me today for more details.

The world of long-term care planning solutions is expanding everyday. Consumers have choices and you have the opportunity do well by doing good things for them.  Contact us today at Barry J. Fisher/Paradigm Insurance Marketing.

barry@paradigmins.com

Let me start by providing you with a bit of background on American General Life and Accident Insurance Company.  ‘A’ Rated by A.M. Best Co, AGLA has been in business since 1900 and has more than 7 million in-force policyholders.  It’s origins date back to National Life of Tennessee (NLT) which was the original owner of the Grand Ole’ Opry.  In 1925 WSM (We Shield Millions) Radio of Nashville, also owned by the Opry, was among the first to advertise the need for life insurance over the airwaves.  Over the years NLT and a number of other insurance companies were merged into American General Corporation in 1968.  AGLA has more than 800 employees in Nashville and surrounding areas and services a wide range of insurance products.

AGLA’s Quality of Life ….^SM insurance products, while not a replacement for traditional LTCi, can provide policyholders of all ages added choices if they suffer a chronic, critical or terminal illness.  One does not have to die to qualify for these benefits and come at no additional cost to the insured. They are built-in benefits that allow the policyholder to accelerate some or all of the face amount and they can spend the money anyway they choose.

If a claim for accelerated benefits is filed, AGLA obtains medical records and other pertinent information in order to determine benefit qualification and the insureds likely life expectation.  This information is used to provide an offer of accelerated benefits based on the original request which can be as high as 95% (terminal illness).  The insured can then choose to take the offer or not. If they do, the death benefit and premium is reduced by the percentage of the death benefit accelerated.  In the case of universal life, cash value is also reduced proportionally.

Competitive rates make the AGLA products very attractive in their own right but this is not a spreadsheet sale.  You will want to spend time explaining the additional benefits of Quality of Life ….^SM Term and Universal life insurance products and work with clients to determine their needs.  The Consumer Choice Term (CCT) portfolio provides guaranteed rates and convertibility privileges. AGLA Choice Universal Life products have various features to meet client’s budgets and needs.  All include the ABR’s for chronic, critical and terminal illness.

And what’s in it for you the agent? Competitive compensation with a built in 20% commission bonus when you have exceeded $30,000 of paid annualized premium during a calendar year.  AGLA also has incentive programs and trips with qualification well in reach of most producers.  Paradigm offices will be offering broker, personal producing general agency and agency contracts.  Check with us to find out the requirements.

American General Life and Accident is a complete package for agents of all types.  Our first training web broadcast is on April 26 at 11:00am PDT. Register by CLICKING HERE, or paste this URL into your browser — https://www1.gotomeeting.com/register/594050065.  The focus of this training will be the basics, accelerated benefit riders and term life products.  We will have a follow-up web training session on universal life in May.

American General Life and Accident Quality of Life ….^SM Term and Universal life insurance is great opportunity for agents at all levels of expertise.  We look forward to you being part of this new opportunity.

barry@paradigmins.com

In many regards this is why I decided to accept Mike Flynn’s offer to head-up the agency’s long-term care insurance department in 1991.  I realized that if I was going to transition from personal production to marketing I needed to differentiate amongst my peers.  It seems to have been a good decision and despite the bumps and bruises along the way, next to marrying my wonderful wife Susan, it was the best danger/opportunity that I’ve taken in my 35 year career.

If you’ve been reading this BLOG over the past few months you know that I’ve been ruminating on the consolidation and changes in long-term care insurance and the pricing issues.  As I’ve stated time and time again, traditional LTCi, from top line carriers, has been and continues to be one of the best risk management decisions that an agent can propose and that a consumer can make.  That being said, we know that many agents are reticent to talk about the need for long-term care planning and insurance and fewer consumers find traditional products affordable.

Late last year I decided to accept a personal challenge. Find new ways that consumers can plan for the risks associated with chronic (LTC) illness.  The writing was on the wall.  The Pension Protection Act opened the door for new solutions but because many of them continued to be targeted at reasonably healthy and wealthy seniors with investable assets, it was clear that I needed to find something more for middle class Americans and the tools for you to make it happen.

As I mentioned in my email announcement to the field this morning, Paradigm Insurance Marketing (which includes Paul Kaplan and Jeff Tackett) is please to represent American General Life & Accident Insurance Company. AGLA has designed Quality of Life ….^SM Term and Universal life insurance products that help consumers cope with the risks associatied with long-term care, critical and terminal illness.  Now, you can make your client’s premium dollars multi-task and one insurance policy can provide meaningful living benefits and options; an opportunity so to speak!

There are many more aspects of AGLA that I want to share with you in the coming days but it is important that you register for our April 26th web broadcast (CLICK HERE). During this webinar you will get the complete picture of how you can fit into this exciting new marketing and sales opportunity.  I hope that you can join us.

barry@paradigmins.com

Context is important however, so let me review some of the key concepts that I’ve been developing over the past few months so that you will understand that we’re enhancing our product offerings and long-term care planning solutions and not throwing the baby out with the bath water.

1. The CLASS Act is a big opportunity for insurance agents. It allows you to open a discussion about long-term care planning.
2. For the vast majority of business owners in their late 40′s and early 50′s traditional LTCi provides tax deductible premiums and tax-free benefits.  Traditional long-term care insurance is provides the most “cluck for the buck” in most LTCi planning scenarios.
3. Multi-life long-term care programs for businesses with the requisite number of employees (7 in California and 3 in most other states) simplifies the underwriting process.  It’s an easy way to compete with CLASS!
4. New business rates on traditional long-term care insurance are going up.  Prudential has filed and we expect Genworth to do the same.  Even though California Department of Insurance is glacial when it comes to these sorts of rate adjustments when it happens you won’t have a whole lot of time to fall back and punt.  We’re in fire sale mode until further notice.
5. With this in mind, your clients are not getting any younger or healthier, rates are not going to go down in our lifetimes; now is the time to talk to all of your clients about the need for long-term care planning  and insurance.

We’ve also seen that traditional LTCi is sadly becoming a product for upper middle class and affluent consumers.  This means that the great middle class needs to make their premium dollars multi-task.Maybe this is not an optimal solution but the fact is that insurance liquidity of some sort when one suffers a chronic (LTC) illness or event is vital.  If someones life or disability insurance provides accelerated or additional benefits, if  long-term care is required, they will have more options to cope with the challenges they face.

Therefore, in the coming months, we will be introducing you to a whole new generation of long-term care planning solutions. These will include annual pay term and universal life insurance, single pay life products, non-can disability coverage, critical illness and annuities.  The one common theme is that all of these, like traditional LTCi, will provide benefits when the insured suffers from a chronic illness. Our intent is to turn you into a long-term care planning solutions machine.

Now for a sneak preview of our first coming attraction:

• ‘A’-rated recognized life insurance company
• Competitive term and universal life products
• All include chronic (LTC), critical and terminal illness accelerated benefit at no-up-front cost to the consumer
• Great commissions + 20% built-in agent commission bonus at $30,000 of paid annualized premium in a calendar year
• Brokerage, PPGA and agency opportunities

The BJFIM/Paradigm marketing team is currently integrating this new product into its long-term care planning solutions portfolio.  The countdown begins today for full release on April 18th.

We look forward to working with you.

barry@paradigmins.com

Another hot topic at ILTCi was the pending meltdown of the Medicaid (Medi-Cal) system that has been crowding-out private sector LTC solutions for decades.  The fact that Americans are able to easily become welfare recipients so that other tax-payers can subsidize their long-term care has caused many to rely on a government solution that is based on political calculus.  Conventional wisdom  currently states that of all of the Federal entitlements Medicaid is likely to be cut back first and hardest leaving some wondering how a good portion of America will be able to afford care later in life.  CLASS is hardly the answer.  Why some think creating a new unsustainable government program to save an already faltering legacy of the nanny state is a mystery to me.

Regardless of industry challenges and government failures the need for individuals to make sure they have enough liquidity to pay for a likely long-term care event has not gone away. But there is good news. The world of long-term care planning solutions is expanding beyond traditional products.  This is not a contradiction to previous statements.  There has been a consolidation in companies offering  traditional LTCi.  But as we continue to search the marketplace we’re finding a myriad of long-term care planning solutions, life, annuity, disability and critical illness products (linked/hybrids),  that will provide consumers with benefits if they suffer from a chronic illness.  These products, while not traditional LTCi, suit different age groups, lifestyles, budgets and planning objectives.  They also allow a consumer’s premium dollars to “multi-task” providing them with important benefits when they need or choose them.

Before telling you about the new products  BJFIM/Paradigm will begin rolling out in the coming weeks let me clearly state what should be obvious to most.  WE, I, OUR AGENCY, has not abandoned traditional long-term care insurance.  There is no substitute for those who can afford and qualify for it.  Sadly, as the traditional market evolves pricing is becoming an increasing challenge and underwriting is likely to tighten.  As agents we need to be committed to indemnifying for the long-term care risk.  All products that do this ought to be considered based on the client’s personal circumstances.  We would be remiss if we ignored long-term care planning solutions that didn’t fit into the tight box of traditional tax-qualified long-term care insurance.

Let’s accept the fact, for the moment, that traditional long-term care insurance is the standard by which other solutions should be judged.  Why?  As we look at the other alternatives that are now available we need to create a context and baseline; a comparative. This doesn’t mean that alternatives to traditional products are inferior, they are merely different and designed to accomplish multiple tasks. In reality this is a good thing; we all talk about CHOICE in health care products, why shouldn’t consumers be able to  choose the priorities of their life, annuity, disability or critical illness policies. This is probably more of a brain shift for agents than it is for consumers.

Why do I believe that traditional long-term care insurance is the baseline for long-term care planning solutions?

1. Benefit qualification in a tax-qualified LTCi policy is HIPAA standardized; the inability to perform 2 of 6 activities of daily living or suffering from a severe cognitive impairment, along with many other consumer protections provides purchasers and agents with confidence that benefits will be paid on a widely accepted standard.  Some, but not all linked products, are consistent with this standardized qualification.  This isn’t necessarily a bad thing; agents merely need to understand the differences and explain them appropriately to their prospects and clients.
2. Benefits in a tax-qualified LTCi policy are stanardized as well.  Based on the state of issue, benefits will be paid for home care,  assisted living or nursing facility.  Restrictions (if any) are clear to both consumers and agents.
3. No other long-term care planning solution can match that of tax-qualified long-term care insurance.  This is where a healthy consumer gets the most cluck-for-the buck. The current “fire sale” on several traditional products makes the long-term care planning discussion an imperative TODAY!
4. Premiums are tax deductible for many consumers and benefits are tax-free regardless of how premiums are treated. This is great for business owners.  Multi-life LTCi eliminates many underwriting challenges and takes full and legal advantage of the tax code to provide low cost benefits.

Some linked/hybrid products use benefit qualifiers that don’t always match the HIPAA definition.  Also, the cost of the long-term care (chonic illness) benefit may or may not be transparent.  Sometimes the cost of the LTC component is clear other times a company will “discount” the accelerated benefit for chronic illness based on the morbidity and or mortality of the insured at time of claim.  None of this is negative. We just need to understand which product best suits the client’s needs and explain it in the appropriate manner.

Which leads me to my last point for today.  When dealing with any long-term care planning solution suitability is the key.  A linked annuity product is probably not appropriate  for a 30-year old. A traditional long-term care insurance product with a 10-pay may work best for a business owner.  Someone who is very elderly or who suffers with Parkinson’s or Multiple Schlerosis may want to consider options that others won’t.  This is an exciting time for insurance agents who want to think through the process and help as many clients as possible. Long-term care planning solutions are on the rise; are you ready to step-up to the plate?

barry@paradigmins.com

No, I’m not talking long-term care insurance today.  I referring to a stunningly under utilized insurance product (in America) that could be the answer to many of your clients’ personal risk management needs. 

In the course of your insurance career have you ever been unable to procure disability insurance or disability buy-out coverage for:

• New business owners who can’t provide adaquate income verification?
• Full-time or part-time stay at home parents?
• Folks who may be concerned about being able to make the mortgage payment due to a serious health issue?
• Professionals who have maxed-out on the amount of disability income coverage they can purchase?
• Business owners looking to create a business succession plan for an up and coming protege’?
• Self-employed business owners and consultants who work from home?

This is just a handful of missed sales opportunities because you may have hit a brick wall with traditional disability insurance offerings. 

Today, however, you can help clients with Critical Illness coverage.

CI is not new. It has been sold in Western Europe and South Africa for decades.  The primary reason for it’s success overseas are the huge gaps in the socialized medicine regimes of these countries. While we’re not quite there yet health insurance is limited to paying for medical care. It doesn’t pay the mortgage, keep the kids in private schools or put food on the table in the event that the insured has to take time off of work or career due to a serious diagnosed illness.  It also won’t pay for child care in the event that the primary stay-at-home parent is unable to be there when little Johnnie or Susie need to be picked-up at school and taken to their next activity.  Regardless of the specifics, in the absence of disability insurance,  life’s ongoing cost can cause extreme personal and family hardship. 

CI pays a lump sum CASH benefit in the event the insured is diagnosed with some number (it varies by company) of named diseases. The American General product that we’re proud to represent has 12 benefit triggers or qualifiers:

• Invasive Cancer
• Heart Attack
• Stroke
• Kidney (Renal) Failure
• Coma
• In Situ Cancer (25% up to a $25,000 max)
• Severe Burns
• Loss of Sight, Speech or Hearing
• Paralysis (50% for paraplegia and hemiplegia)
• Major Organ Transplant (25% payable when placed on UNOS listing)
• Coronary Artery Bypass (25% up to a $50,000 max)
• Loss of Independent Living

The Loss of Independent Living trigger looks much like the benefit qualifier for tax qualified long-term care insurance.  Couple this with the fact that AG offers a lifetime benefit that does not reduce and or disappear after age 65 and you’ve got a policy that can provide long-term protection throughout someones life expectancy.

There are other great reasons why clients who have already purchased disability income or health insurance from you may want to consider adding critical illness protection:

• Elimination period gap protection
• Coverage on most disability policies ends at age 65
• Home modification as a consequence of a serious disability
• Capital for investment/retirement plan completion
• Help with high deductible health plan expenses

CASH IS KING!  Especially when someone is sick.  How will your clients feel about you when you arrived with a check for $50,000, $100,000 or more when they’re worried about paying the bills, putting food on the table or taking care of their children?  How would they feel about you if you didn’t and found out later that you could have helped them with critical illness coverage?

Call your BJFIM/Paradigm marketing representative today.  CLICK HERE for our direct dial numbers and email addresses.

barry@paradigmins.com

BJFIM/Paradigm has added American General to it’s comprehensive list of traditional and linked long-term care insurace carriers. The new AG product is simple and easy to to explain to consumers. Here are a few of the highlights:

• Choose a lifetime maximum benefit (coverage) in easy to understand increments
  • $100,000, $250,000, $400,000, $500,000, $600,000, $750,000 or $1,000,000
• Select a monly maximum benefit amount from $2,000 to $12,000 in $1,000 increments
  • Some limitations do apply
• Calendar Day Elimination Periods
  • 30, 90, 180, 365
  • Optional 0-Day Elimiantion Period for Home & Community Care
• 40% Flexible Cash (included in base plan)
  • Insured can selelct cash alternative to reimbursement and pay for the services they choose on a monthly basis
  • Unused benefit remains in the lifetime benefit for future use
• Shared Care Benefit Rider
  • This is a one-of-a-kind true third pool of money.
• Inflation protection options allow for flexible product designs and affordability
  • 3% or 5% compound for life
  • 3% or 5% compound for life funded with graded premium increases
  • 3% or 5% compounded for life funded with graded premium increases to Age 65
    • The “third pool” shared care rider coupled with one of the 3% compound inflation options creates an extraordinarily compeititive benefit package
• AND THERE’S MORE!
  • Joint waiver of premium rider
  • Joint survivor benefit rider
  • Paid-up premium rider
  • Return of premium at death benefit rider
  • Restoration of benefit rider
  • Marital and preferred health discounts

NOW HERE’S THE KICKER (TEASE!)

American General accepts, Visa, MasterCard and American Express for premium payment.  This means that your clients can charge their premiums and receive airline miles or any other sort of “benefit” their credit card company offers them¹.  This is a great value added (for many reasons) to a terrific product.

American General has earned the following rating from the various services

• A — A.M. Best
• A+ — S & P
• A1 — Moody’s
• A- — Fitch
• C+ — Weiss
• 83 — Comdex

AG’s Surplus as a percentage of Assets is 17% and it Risk Based Capital Rating Ratio is 424.

Contact your BJFIM/Paradigm marketing representative TODAY.  We’re ready to provide product information and quotes for American General TODAY! 

We look forward to hearing from you.

barry@paradigmins.com

^{1 AGENTS BEWARE!  Do not use airline miles or other credit card “spiffs” as an inducement to purchase this product as it could be misconstured as an illegal rebate.  Use discretion when describing this product feature.}

Custom Care II, Custom Care II Partnership and Corporate Solutions (multi-life) applications must be dated on or before June 6, 2010, and must be received at the home office by June 21, 2010.  This means that applications must be received in the BJFIM/Paradigm Woodland Hills, California office no later than June 18, 2010 so that they can processed and FedEx’d to the home office to meet the deadline.  Lot’s of “must be’s”, but having been through our share of fire sales over the past 15 years we know how important it is to understand the rules set forth by the insurance company in order to get this business issued.  Rest assured that the BJFIM/Paradigm LTCi team will do everything it can to help you get those applications submitted in a timely manner.

John Hancock has a number of other product changes, suspensions and withdrawals in various different states.  For state-by-state rules and information contact your BJFIM/Paradigm Marketing Representative or CLICK HERE for JH’s May 3, 2010 product announcement.

So you may be wondering why this is happening and is there cause for concern.  In my opinion the short answer is “NO”.  Let me start with the situation in California.  The primary reason for the withdrawal is the glacial regulatory environment at the California Department of Insurance.  Custom Care II, the basic chassis for all products sold in California, has needed a new business repricing for several years now. John Hancock has filed the request, but as is typical, it languishes on some bureaucrat’s desk.  Long-term care insurance new product approvals and repricing is a low priority at CDI and the shortened work week now in place for state government employees has made matters even worse. 

In my opinion John Hancock has made a good business decision pertaining to its California business.  If the home office actuaries are not comfortable with a product’s pricing as it pertains to a host of global economic issues (which appears to be the case) the responsible thing to do is suspend sales.  This isn’t the “schmata” business; an insurance company cannot lose money on every sale and try to make it up in the volume.

On the national level John Hancock appears to be honing it’s product offering.  At this point I don’t see any red flags that would indicate wholesale abandonment of this market segment or risk. All major long-term care insurance companies have or will reprice compound inflation protection, move away from lifetime benefits and attempt to simplify their overall product lines. I may be wrong but as agents we should be supportive of an insurance carrier’s attempts to act responsibly in product pricing.  We’ve seen the results of the opposite strategy and they can be ugly.

That being said there’s a whole lot of opportunity in this news. Here’s a quick review:

1. The most obvious is to close out any existing John Hancock long-term care cases you have by the submission deadlines outlined above. If Custom Care II (particularly California Partnership) is the right choice for your client then there’s no time like the present to get it done.  Be assured that when JH comes back into California, the premiums on 5% compound inflation will be much higher and lifetime benefits will probably no longer be available.
2. Going forward we still have a number of great companies with mid-2000′s 5% compound inflation pricing; Prudential, Genworth, United of Omaha, Transamerica and Berkshire have not yet repriced.  I’ve said it before but I’ll say it again, your client/prospect will never see better premiums then NOW on 5% compound inflation protection.  How do you say going, going, gone!
3. If California Partnership is your client’s preference then after June 6, 2010 your one viable choice in the independent LTCi brokerage channel will be Genworth.  Additionally, Genworth is one of the few companies that continues to be bullish on lifetime benefits. After a rough 2009 Genworth is looking very strong.
4. MetLife’s new LifeStage Advantage offers a very simplied “piece of money” product chassis. While the 5% compound inflation rider has been repriced upward on both LifeStage and VIP 2, other inflation options coupled with multi-life at three lives make Met an important player in the multi-life market.

Regardless of these and future changes anticipating the long-term care risk is an essential part of responsible financial and insurance planning. For better or for worse traditional and linked LTCi products will continue to evolve but the problem remains the same. The solution is get your client’s needs covered with the best choice or choices that exist in today’s marketplace. 

BJFIM/Paradigm stands ready to help.  Call us today!

Now at the risk of being politically incorrect or offending someone’s tender sensibilities my simple and straightforward philosophy towards an over weaning government controlled health care system has been simple and straightforward:

1. The government has a legitimate interest in fostering and regulating a level playing field so that private insurers can create insurance policies that people want to purchase and to make sure that the consumer is protected against insurance programs  that don’t live up to their promises; and
2. The government that governs least governs best.

To say the least, the health care reform bill that is being signed into law as I write this Blog is none of the above.  It is not only everything that many of us have fought over the years it is exactly the worst of all of the evils that supporters of more government invovlement claim that they are fighting against.  A case in point is the CLASS Act long-term care component of the reform bill. While it holds out the promise of long-term care benefits  it’s primary function within health care reform is one of the many  dubious “revenue neutral” funding schemes within the bill. 

While the outlines of coverage within CLASS are still hazy what is clear is that the majority political party is counting on it to generate $70 billion dollars of revenue towards the overall cost of health care reform. This despite the fact that the American Academy of Actuaries and the Society of Actuaries have already told anyone who will listen in the Federal government that CLASS is “actuarially unsustainable“.  Since I’ve already discussed CLASS in last month’s BJFIM/Paradigm Webinar and at our broker meeting in Woodland Hills two weeks ago I won’t bore you with the sketchy details of the plan and will cut to the chase; IN MY OPINION, CLASS is an integral part of a government run Ponzi scheme being perpetrated on the American people.  If an insurance company designed and marketed a product like this to consumers its executives, including the actuaries, would be “perp-walked” out on the nightly news. So to quote radio talk show host and President of the Landmark Legal Foudation, Mark Levin, “so there, I said it!” 

But the beautiful thing about America and the entrepreneurial amongst us is that there is a “pony” in this pile of *&*$. The one good thing about CLASS is that employers must “opt-out” of offering CLASS insurance (and I use the term insurance loosely) to their employees. This gives you the opportunity to open the discussion.  The pro-active agent and financial planner has a reason to discuss and encourage employers to insure themselves and key employees  with high quality private long-term care insurance and offer the same on a voluntary basis to all employees. There’s no time like the present to do this.  Overtime, CLASS will skew the private LTCi markets making products more expensive and less attractive to consumers. Why you may ask?  Enrollment in CLASS is likely to be less than predicted and adverse selection will be rampant due to the guaranteed issue basis of the program. As CLASS’ anticipated revenue does not materialize, it will threaten to torpedo the entire funding scheme of  Health Care Reform.  What happens when government programs fail?  Politicians and bureaucrats tinker with the private markets and we all know where that leads.

You can do good for yourself and your clients by getting them into private long-term care insurance today.  Traditional or linked LTCi will never get better or be “cheaper” than it is now.  Over the next month I will post a series of product reviews giving you the highlights of each of the carriers in our portfolio.  We will also do a webinar sometime prior to the end of April to sum up the best of the best.  As always, our job at BJFIM/Paradigm is to help you make more long-term care insurance sales easily and quickly. Our staff stands ready to assist you.

In the meantime I hope that you will join me in becoming more actively involved in our electoral process so that we can replace those in Washington D.C. and Sacramento who wish to abrogate our freedom of choice in all things health insurance and health care related.  As we’ve painfully learned elections have consequences. Let’s make sure that the next one does as well but this time in the freedom’s favor.

barry@paradigmins.com

Where does this leave the typical consumer?  Ill served at best.  In the dark with an uncovered insurance risk at worst.  The smart planner will search out the information and broker that can help them but the simple truth remains that most don’t.  They either don’t understand or don’t know the problems that are headed their way. 

There is a confluence between my assertions above.  Many agents and most consumers are unaware of the expanding world of long-term care planning and insurance solutions that now exist.  Traditional long-term care insurance is no longer the only choice.  Brokers that focus on life insurance or annuities can now offer products with the advantage of long-term care coverage.  And traditional long-term care insurance agents may begin losing sales to their more nimble competition if they don’t move their game to a higher level.  The full implementation of the Pension Protection Act of 2006 means that financial and insurance professionals of all stripes are now playing in each other’s sandbox.  Either they will become fluent in how all of the various planning tools fit consumer’s needs or they will begin to lose sales, get sued by disgruntled clients and heirs or both.  Which category do you want to find yourself in?

It is because of this growth of new product types that we at BJFIM/Paradigm are changing our focus from long-term care “insurance” to long-term care “planning”.  Yes, we still make our living by helping you market and sell insurance products that indemnify against the long-term care risk.  But now the solution may include a life or annuity combo, traditional long-term care insurance or all three.  Sales will be won by those agents who can appropriately discuss the long-term care risk, help clients understand that planning for it makes sense and recommending the proper insurance solutions.

So does this mean that you’ll have to learn about new products and techniques that will help you assist your prospects and clients?  Afraid so. I’ve been at it for more than a year and our staff has as well.  And now that the provisions of the Pension Protection Act are fully in play insurance carriers are bringing new products online every month.  1035 Exchange opportunities will abound. Consumers will soon learn that they can use latent cash values in existing life or annuity products to provide themselves with life, retirement and long-term care security.  These folks will represent the low-hanging fruit for the agile agent. The question is, will you be the on the receiving or short end of the exchange process? 

As always our plan is to make it easy for you to succeed in all things involved in long-term care planning.  That’s why on March 11, 2010 we will be hosting a seminar that will help you become a master of this new world.  Join us for Links To Long-Term Care Planning Success, a day complete with product, marketing and sales ideas, continuing education credits and a whole lot more.  You won’t want to miss this opportunity to meet with our entire staff and our friends from Genworth Financial an industry leader in traditional and linked long-term care insurance products and planning.  

Take advantage of our early bird tuition and don’t forget, space is limited. Our meeting in October sold out so you want to reserve your seat today.  Click Here to get a complete program guide and register today!  We look forward to seeing you on March 11.

barry@paradigmins.com