• Eric Jacoby, CFP, is a financial planner who has made long-term care planning a must for his clients. For the past ten years Eric has consistently been one of our most productive brokers.  Eric has built his practice on networking with attorneys, CPAs and other financial planning professinals who value his expertise. No one gets away from Eric without hearing his sermon on the need for long-term care liquidity and how an unplanned for long-term care event can devestate even the most well conceived financial plan.
• Timothy Milaney,  CPCU, CLU, CIC, RHU, ChFC, CORS, PWCA, was our top producer in 2008.  His success is a result of one simple maxim; ask each and every client that if they have taken care of their long-term care planning.  If not, insist that they sit down and discuss it. Tim’s “One Responsible Source” business philosophy drives his desire to help his clients properly manage the financial risks they face.
• Mary Lou Reid, CFP & John Celantano are a financial planning tag-team who have been integrating long-term care insurance into their clients’ portfolios for more than twenty years.  John and Mary Lou have been industry leaders utilizing linked product solutions and have placed more than $25 million in asset based life and annuity long-term care combos.  Their insights will help you build the confidence you need to succeed in this fast growing segment of the long-term care insurance marketplace.
• Janet Madrigal, has come out of nowhere to become our fast-start wiz in 2010.  An insurance professional with varied and broad experience, Janet has made a serious committment to include long-term care insurance in each of her clients’ portfolios. We fully expect Janet to be in our top five for 2010.

What do all of these successful LTCi producers have in common?  They walk the walk and talk the talk!  They’ve included long-term care insurance into their day to day discussion of risk and financial planning and candidly, they don’t take “no” for an answer.  I’m also pleased to report that most use a number of the simplified sales tools that we’ve develped throughout the years to help make long-term care insurance simple to explain and understand.

And there’s an added bonus when you join us on March 11^th; during our Producer Panel, you’ll be able to partake in some great wines and enjoy gourmet chocolate from Tifa Chocolate in Agoura Hills.  Learning how to sell long-term care insurance doesn’t get much better than this!

CLICK HERE to read more about our Producer Panel and the rest of our top-flight presenters for our March 11^th meeting.

REGISTER TODAY and take advantage of our early bird pricing.  Space is filling quickly. You won’t want to miss this opportunity to get the competitive edge in all things long-term care insurance related.

barry@paradigmins.com

Underwriting Traditional & Combo LTCi — The Changing Game in Long-Term Care Risk Evaluation (course #238088) will provide you with insights into similarities and differences between traditional long-term care underwriting and the new combo products.  We know how difficult traditional long-term care insurance underwriting can be. The advent of life combo products adds the wrinkle of mortality to the morbidity piece that we’ve grown accustomed to.  Additionally, annuity combo products may provide us with a safe harbor of sorts for some of our most difficult underwriting challenges.  Understanding where each of the three products types works best can help you satisfy the client’s need for long-term care planning.  And there is no one better than Amy Chambers, Genworth Underwriting Manager, to be your coach in this arena.  This course is a must for any insurance and financial planning professional because it will make your life (as well as your clients’) a whole lot easier. 

Regardless of which product type you sell, the long-term care claims process is likely to come into play.  Long-Term Care Insurance Claims Practices — Where The Rubber Meets the Road in LTCi  (course #238087) is our second hour of continuing education on March 11th.  It is designed to give you clarity on claims adjudication so that you can confidently explain to prospects and clients what to expect.  The question of claims payment is one of the most often asked by agents and consumers alike and Renee Roberti-Klemenok, Genworth Claims Adjudicator will provide you with the tools and understanding necessary to sound like pro.

In addition to the two hours of classroom continuing education, attendees on March 11th will receive coupons for a big discount on two very important online continuing education classes from Lyte Speed Learning  (Provider #65579);  2004 California Long-Term Care 8-hour certification (course #146378) and Annuity Compliance 4-hrs (course #179938).  The discounted price of these online courses are $19.50 and $9.99 respectively.  This is a great value on courses that we all need to take every two years.  

Product, marketing, sales training, continuing education, networking, great food, wine and chocolate.  What more could you ask for in an agent’s insurance seminar?  REGISTER TODAY for this great event.  Space is limited and reservations are streaming in.  We look forward to seeing you on March 11th.

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

The long-term care sales success “game” will be won by agents who are fluent in long-term care planning as well as those who can juggle multiple types of products. Traditional long-term care insurance agents will want to understand when and where linked products are appropriate.  Brokers who focus on life insurance will need to learn how an ABR for chronic illness can help their clients solve part or all of their long-term care need. Annuity specialists will want to consider how consumers with traditional annuity products may be able to take advantage of the new linked benefit offerings.  The opportunities in long-term care planning have just expanded exponentially; are you ready to multiply your sales? 

Join the Paradigm Insurance Marketing team and Genworth Financial on March 11, 2010 to discover the new universe of long-term care planning techniques and products. No insurance carrier and brokerage general agency are better positioned to help you capitalize on these new opportunities.  Here’s the short list of what you’ll learn:

       Life and long-term care insurance industry insights from Robert Eckhardt, Genworth Financial Senior V.P.                  

       Comprehensive product reviews for traditional and linked long-term care insurance as well as life and annuity products.

       One-hour continuing education session on traditional and linked long-term care insurance underwriting.

       One-hour continuing education session on the long-term care claims process.

       Top producer panel with a focus on opening new cases, presenting and positioning linked and traditional products and closing sales.

       Discounted online continuing education package from Lyte-Speed Learning

       Networking lunch + afternoon wine, cheese and gourmet chocolate tasting

       Discounts for 12-hours of online continuing education training from Lyte-Speed Learning

       Raffle prizes and much more

FOR A COMPLETE PROGRAM & REGISTRATION click on the link.  Take advantage of our early registration tuition.  Also, please note that space is absolutely limited at the Woodland Hills Country Club. I mention this because we had to turn some folks away for our October 2009 seminar and registrations for this event are coming in daily.

Susan, Paul and I thank you for your business and look forward to seeing you on March 11, 2010.

barry@paradigmins.com

And now, John Hancock has a simplified issue/multi-life long-term care insurance program approved in Californiathat can provide you more opportunities to make LTCi an even bigger part of your 2010 profit picture.  You can get all the specifics regarding Corporate Solutions at our new BJFIM website.  That being said let me provide you with three highlights that make John Hancock’s Corporate Solutions distinctive: 

1. John Hancock’s Corporate Solutions requires seven (7) employer paid lives for simplified issue.  However, the minimum daily benefit allowed under the program is $50 per day (most other simplified issue multi-life plans require $100/day).  This means that an employer can make a very small premium contribution for employees in order to get the requisite seven lives for simplified issue. For example, a $50/day 2-year benefit plan for a 50-year old costs less than $11 per month (37 cents per day). 
2. Once you get seven employer paid employees into the program, spouses become eligible for simplified issue as well.  The employer must pay for a portion of the spouse’s premium but the spouse need not be actively at work. 
3. Until now all simplified issue multi-life programs issued policies at the standard (as opposed to preferred) rate class.  However, John Hancock offers a “preferred industry discount” of 15% for a specified list of employer groups including legal, accounting and medical offices. Click Here and go to slide 23 of the presentation for a complete listing of preferred industries. 

There are other great reasons why you should be considering John Hancock Corporate Solutions for simplified issue/multi-life long-term care insurance.  Contact your BJFIM/Paradigm marketing representative today for quotes and more information. 

barry@paradigmins.com

The Good News……..

While LIMRA reports year-over-year life and long-term care sales are down significantly, I’m pleased to say that, thanks to many of you, our LTCi production, particularly in the past six months, has been robust. Many of our agents continue to spread the gospel of long-term care planning and they are finding clients who wish to protect the assets and income they’ve been able to preserve.  The need for long-term planning has not gone away.  Informed consumers will continue to take advantage of the growing number of long-term care planning solutions. Smarter agents will educate themselves and stay abreast of changes and opportunities in long-term care planning.

CLASS-less In Washington, DC

I think it’s safe to say that Americans of most political persuasions are disgusted with the spectacle of Congress debating health care “reform” behind closed doors and taking votes in the middle of the night in the hope that we won’t notice.  The soon-to-be passed Senate version includes the CLASS Act (another misnomer), an inspiration of late Senator Ted Kennedy, designed to provide basic long-term care benefits to those who cho0se to enroll. It is hard to say exactly what this plan will cover, when it will cover it, how benefits will be accessed, how underwriting (if any) will work and what it will cost; other than that it’s great! CLASS may not even make it into a final health care reform bill depending on the reconciliation process used between House and Senate versions of their respective bills.  With this in mind, I’ll keep my powder dry as to what impact, if any, a government option for long-term care coverage will have on us.  Frankly, I don’t think the Federal Government can compete with the private sector, nor do I believe the current purchaser of long-term care insurance will be impressed with the offering. Time will tell and I’ll keep you posted.

Pension Protection Act (PPA) & Long-Term Care Is Here!

The world of long-term care planning will become bigger and better in 2010 as provisions of PPA 2006 come into play.  Beginning on January 1, 2010:

• Linked Benefit Annuity products with Qualified Long-Term Care Benefits
  • Qualified long-term care benefits received for covered long-term care expenses are tax-free
  • Internal long-term care rider charges are not taxed as distributions
• Linked Benefit Life Insurance products will improve
  • Internal long-term care rider charges are not taxed as distributions
  • Accelerated benefits for long-term care will be received tax-free
• Traditional long-term care funding opportunities expand
  • New 1035 exchange rules provide tax-free options to fund traditional long-term care insurance policies.
    • In theory, the owner of a cash value life insurance policy or non-qualified single premium deferred annuity can do a partial 1035 exchange to pay for a traditional LTCi policy.  How quickly and effectively companies can put this mechanism in place remains to be seen.
    • Payments sent from a single premium immediate annuity carrier to pay for a traditional LTCi policy are tax-free.  Again, the inter-company ability to perform this transaction may not yet be widely available.

Earlier in the year I wrote two articles for Broker World on the topic of linked products. CLICK HERE for the article pertaining to linked life insurance products and HERE the article on linked annuity products.

BJFIM/Paradigm is on the cutting edge of this new world of linked products and funding mechanisms.  For those of you who attended our October meeting, you know that life and annuity products with linked long-term care benefits present expanding sales opportunities for you. We’re pleased to represent the following linked benefit companies in California (listed alphabetically):

Genworth

John Hancock

Lincoln Financial

Nationwide

State Life

Next year we plan to schedule monthly webinars with these various companies in order to assist you in identifying the right clients for these linked products, how to open new cases, how to position these products with and without traditional long-term care insurance and how to close the deal. Stay tuned for more information on these web meetings.

Spring Is Almost in the Air – Well Maybe Not Quite Yet

We are currently developing our concept for a broker meeting in early March.  I hope to have a date for you shortly.

New BJFIM Website Coming Soon

We’re hoping to have a brand new Barry J. Fisher Insurance Marketing, Inc. website before the end of Q1 2010.  The new website will be simplified and easier to navigate.  It will also be more completely linked to our new Paradigm Insurance Marketing website which is already providing our agents with forms online and a whole host of life insurance tools. We devote many resources to our websites.  We hope you find them useful and we’d appreciate your feedback on their usefulness for you.

2009 has been a challenging but good year. We appreciate your business and continued friendship. The staff and I wish you slightly belated Happy Chanukah as well as an upcoming Merry Christmas and Happy New Year.  We look forward to working with you in 2010.

barry@paradigmins.com

P.S. Our offices will be closed December 24^th and 25^th for Christmas and December 31^st and January 1^st for the New Year holidays.

LTC E-Alert #9-135: CLASS News and More

Wednesday, November 18, 2009

Seattle–

LTC Comment: Good news and bad news today for CLASS advocates.

Surely proponents of the government-run LTC financing plan will celebrate its inclusion in the Senate’s health reform bill. See “Long-Term Care Plan to Be in Bill” in the Wall Street Journal here if you subscribe online or on page A-4 in the print edition.

But hold off on the celebration because the Chief Actuary at the Centers for Medicare and Medicaid Services (CMS) says CLASS is a dud. See “CMS Actuary: CLASS Act Would Not Work” posted by National Underwriter here. Some excerpts:

“In a report given to House Republicans Friday, CMS actuary Richard Foster says the Community Living Assistance Services and Support Act, or CLASS Act, program provision in H.R. 3962 would bring in $39 billion in new federal revenue during its first 9 years of operation, but then start to fall apart.

“Foster predicts:

- Average premiums for the program would be $180 per month.

- By 2025, the program would start paying out more than it collected in premiums, resulting in a net federal cost.

- Despite assurances of actuarial soundness, there is a significant risk that the program would be unsustainable.

“‘Voluntary, unsubsidized and non-underwritten insurance programs such as CLASS face a significant risk of failure as a result of adverse selection by participants,’ Foster writes in his report. . . .

“‘This effect has been termed the ‘classic assessment spiral’, or ‘insurance death spiral’,’ he writes. . . .”

You can find the full report of the CMS Actuary here. And it’s a doozy going much further than nixing the CLASS Act to lambasting the House’s health reform proposal in general.

Interesting note: CMS Chief Actuary Foster is the same fellow the Bush Administration allegedly threatened to fire in 2003 for disclosing higher estimates for the then-proposed Medicare Part D pharmacy program than management wanted to concede. Nervy guy!

Here’s a summary of Foster’s full report from the NCPA: Daily Policy Digest 11-17-2009:

HOUSE HEALTH BILL WILL HIKE COSTS $289 BILLION

————————————————————————

The House-approved health care overhaul would raise the costs of health care by $289 billion over the next 10 years, according to an analysis by Richard S. Foster, the chief actuary at the Centers for Medicare and Medicaid Services (CMS).

Minority Leader John Boehner (R-Ohio) highlighted the CMS report on Saturday in a written statement. “This report once again discredits Democrats’ assertions that their $1.3 trillion government takeover of health care will lower costs, and it confirms that this bill violates President Obama’s promise to bend the cost curve. It’s now beyond dispute that their bill will raise costs, which is exactly what the American people don’t want.”

According to the 31-page report, the House-passed bill would increase costs, cut Medicare and expand Medicaid:

o For calendar years 2010 through 2019, national health expenditures would increase by $289 billion.

o About three-fifths or more than 60 percent of the uninsured would gain coverage by an expansion in Medicaid eligibility.

o Medicare would be cut by more than one-half trillion dollars ($571 billion), possibly jeopardizing access to care for beneficiaries, and smaller companies would be inclined to terminate their existing coverage.

The nonpartisan analysis demonstrates that the Democrats’ bill “does the opposite of everything they’ve been wanting to do” in terms of reducing overall health costs, says House Ways and Means Committee ranking member Dave Camp (R-Mich.).

He added the CMS report shows that “this is not health care reform, this is entitlement expansion.”

In an interview with The Hill on Saturday afternoon, Camp pointed out that CMS actuarial numbers were cited by Democrats back in 2003 during the Medicare prescription drug debate:

o CMS estimated at that time that the GOP-crafted Medicare bill would cost more than $550 billion over 10 years while CBO estimated its price tag at $395 over the same period.

o The CMS cost estimate did not emerge until after the final conference bill was approved by Congress.

Source: Molly K. Hooper, “CMS: House Health Bill Will Hike Costs $289B,” The Hill, November 14, 2009; and Richard S. Foster, “Estimated Financial Effects of the “America’s Affordable Health Choices Act of 2009,” (H.R. 3962), as Passed by the House on November 7, 2009,” Centers for Medicare & Medicaid Services, November 13, 2009.

For text:

http://thehill.com/homenews/house/67791-cms-house-health-bill-will-hike-costs-289b

For CMS report:

http://republicans.waysandmeans.house.gov/UploadedFiles/OACT_Memorandum_on_Financial_Impact_of_H_R__3962__11-13-09_.pdf

For more on Health Issues:

http://www.ncpa.org/sub/dpd/?Article_Category=16

More from our dear friends in Washington DC!

Here’s hoping you have a great Thanksgiving.

barry@paradigmins.com

I’d like to invite you to join us on October 8, 2009 for our fall broker meeting. We have an all-star line-up of insurance company presenters, product, sales and marketing information and six hours of continuing education, designed to help you discover and master the new world of long-term care planning.

CLICK HERE to download a complete event program and register today.  Space is limited and “early bird” registrants get the advantage of discounted pricing.

We look forward to seeing you soon.

barry@paradigmins.com

In light of this economic uncertainty individual consumers and small business owners are rightly concerned about keeping their jobs, maintaining their businesses and lowering their overhead.  It hasn’t gotten any easier to start the long-term care planning “conversation”. However, your client’s problem hasn’t gone away.  If they think it has, they are taking a vacation from reality.  In fact, the investments and home equity they may have been relying on to pay for their long-term care have evaporated and may or may not be back when they need it.  There are now more long-term care planning solutions available then ever before; our goal is to provide you with the products and tools that can make the process easy for you and your clients.

The long-term care insurance “game” has been changing and will continue to do so in more radical ways.  The day of most consumers being able to afford lifetime benefits is a distant memory in the rear view mirror. The re-pricing (that means UP!) of compound inflation benefits is now upon us.  Utilization of assisted living benefits will soon begin taking their toll on claims experience forcing a rethinking of that benefit and cost. Finally the Pension Protection Act of 2006 and the proliferation of accelerated benefits for chronic illness will create new sales opportunities of life insurance and annuity products; combos so to speak. The faint of heart will avoid the changes or stop talking to their prospects and clients about long-term care planning. The rest of us will take the challenge, learn some new tricks and go forth and sell. Which category will you fall into?

There are three simple steps to making the transition but even before that there’s a “pre-step” so to speak.  That is that long-term care planning can no longer be product centric. In fact, it must be life stage focused. You see, people of all ages must contend with the notion of planning for an unforeseen chronic illness.  Long-term care planning can no longer be viewed as something that happens to older people. Folks of all ages suffer from serious accidents and illnesses that require care that isn’t covered by medical insurance.  Yes, I know that the proliferation of long-term care happens towards the end of life but how lousy would you feel if you sold a life insurance policy to a 35-year old father without an accelerated benefit rider for chronic illness who, after a serious auto or skiing accident, can no longer care for himself?

It is all about life stage.  The appropriate sale to a 25 to 45 year old would probably be a UL or term life product with an accelerated benefit for chronic illness.  The middle age individual (late 40’s to early 60’s) would still want some amount of traditional long-term care insurance. It ultimately provides the most clucks for your chronic illness bucks. The older client, mid 60’s to late 70’s, may wish to consider repositioning some of their underperforming investible assets, that they’ve set aside for the long-term care emergency, into an asset based solution such as a single premium life + ABR for chronic illness or a Pension Protection Act annuity + qualified long-term care benefit rider.  Smart insurance professionals will learn how to coordinate and “stack” these various coverages to best serve the consumer.

It’s been said that every great presentation can be distilled into a three step process. Here’s my suggested approach to getting clients started on the long-term care planning path:

1. Identify the risk. Everyone’s got one, young, middle aged and older. Illustrate a reasonable long-term care scenario for the age of the client that you are talking to.  A client doesn’t know that they have a problem until you describe it to them.  You can use our “Pool of Money” software or any tool that allows you to model the potential event. Just give them a planning target to shoot at. Something is better than nothing.
2. If the client recognizes that they have a problem, suggest an age appropriate solution. Keep in mind that what you are suggesting today will only be part of that solution. Needs and products change. Just like people purchase life insurance more than once in their lives coverage for chronic illness will no longer be a one shot approach.
3. Review and keep reviewing your client’s need to leverage the risk of chronic illness.  It’s all about life stage and the client’s inclination towards indemnifying for the risk. Some will want some and other will want none.

There’s one more thing. You will need to lead with questions not answers.  If your client is concerned about this risk, regardless of their life stage, it will be appropriate for you to ask for some basic information about their finances; income, net worth and the amount and sorts of investible assets is essential particularly when you are working with clients in the later stages of life.  If you insist on throwing product choices at the client without doing your homework they are unlikely to buy. Long-term care planning, with insurance, will continue to be a rifle shot not a shotgun sale.

Resilience is the key to surviving and thriving.  If I had my druthers I’d like to be back in 2001 selling traditional LTCi with lifetime benefits, 5% compound inflation and 10-pay premiums. The sad fact, however, is that we as an industry, have only cracked the code of long-term care planning for less than 10% of the folks who need it.  This isn’t an impressive scorecard. If we care, we need to do better for our clients and ultimately ourselves. So into the breech I go; care to join me?

Don’t miss our webinar on Thursday August 27^th.  Click here to register.

barry@paradigmins.com