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Producer Assist Comes To Broadtower Insurance Solutions

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In our ongoing efforts to help agents and advisers raise consumer awareness in long-term care planning Broadtower Insurance Solutions and Genworth Financial are pleased to provide Producer Assist to its valued distribution partners on a national basis. This cutting-edge program is designed to assist insurance advisors and their clients in choosing the most suitable planning options for providing liquidity to pay for long-term care.

Recently one of our member agencies got this email from an agent:

“I met with Doug Hayden, CLTC, Genworth, this morning.  Thank you for the opportunity to have Doug as a resource person for me.  I found our meeting to be invaluable.  After thirty five years in the industry, I became uninformed in the Long Term Care market.  I was really out of date since it had been several years when I sold my last Long Term Care policy.  Doug was extremely instrumental in bringing me up- to-date, reminded me how to position myself and brought forth ideas on how to create affordable solutions.    

On a scale of 1 to 10, 10 being the highest score, the value to me scored 10.”

– Linda Harris, Harris Insurance & Financial Services, San Diego, CA

In order to create a template for success a test group of our member agencies have introduced Producer Assist to their brokers.  The results are in and they are dramatic.  Agents appreciate the contact and training they receive from Genworth RVPs, proposal activity for all companies we represent are up because agents are talking to their clients about long-term care and the pace of new business is on the rise.

Agents and advisers participating in Producer Assist can expect the following:

  • Best practices for establishing their firm as a long-term care center of excellence;
  • How to effectively start the long-term care planning conversation with clients;
  • Training for agents and your staff on the basics of long-term care planning and insurance;
  • How to determine the most suitable product choices for each prospect;
  • How to create an ongoing stream of long-term planning referred leads;
  • Special training opportunities.

Producer Assist is product-neutral.  This means that while the Genworth RVPs will do both generic and product-specific training, your agents will continue to work with you and your marketing staff for specific client/case development and proposal preparation.  A rising tide lifts all boats, and Genworth believes that by helping you build your business they will get their fair share of it.  Producer Assist is a win-win for you, and the long-term care insurance industry as a whole.  Do not miss this exciting opportunity to expand your business and help your agents and their clients.

A number of you have expressed an interest in getting Producer Assist up and running in your agencies.  We’ve passed this information onto D.J. Mormile for follow-up. If you haven’t yet decided whether Producer Assist is for you please contact Ron or Barry for more information.

LTCi Underwriting: Take The Pledge!

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Vigilance is in order! Declines, NTOs and Withdrawn applications are ‘killing the goose that laid the golden egg’ – placement ratios are the life blood of our long-term care insurance business. Bonus dollars are critically important to all of us, and they are now in peril!

We all know:

  • There is nothing easy about the sale, underwriting or placement of LTCi. Successfully completing the process is mandatory. Wasting time and money on apps that cannot be placed is simply foolish.
  • LTCi is acquired with the clients’ good health.
  • Commissions and bonus is the manna that keeps us in the game.
  • A decline or false start with an LTCi application helps no one and harms everyone from the customer all the way to reinsurance.
  • Potentially every consumer that reaches out to buy is probably the worst possible prospect. It usually means they know something about their health, or family history that makes getting them insurance a problem.
  • That’s why our real job is to help agents SELL AND PLACE quality LTCi – not just take orders for bad business!

Some helpful hints:

  • Someone is almost always pulling your leg. Whether the health questions are on the application or not – always do you own prescreening.  Ask the questions, never accept business without adequate field underwriting.
    1. Who initiated the request for the quote
    2. Height and weight
    3. All Rx medications
    4. Recent or anticipated surgeries
    5. Family history
  • In point of fact – why even quote a case that has no hope of success?
  • Always manage expectations
    1. Quote the correct and anticipated rate class
    2. Internalize the absolute certainty that nothing will “slip through” underwriting. If Para-Med exams are necessary, all health issues will be revealed.
    3. Prepare the client for rate class adjustments – exams, cognitive testing and the possibility that one spouse may not “make the cut”.
    4. Incomplete paperwork, or agent training certification being out of sync, will result in major delays – increasing the possiblity that applications may whiter on the vine or may have to be retaken

‘Preaching to the choir’ – more helpful hints:

  • Take full advantage of the carrier underwriting ‘hot lines’. If there is any doubt at all, call and be sure to document the call.
  • Recommend the use of e-applications, where we can monitor the apps before actual submission.
  • If the company application does not ask the medical questions – you and the agents must do it anyway.
  • LTCi agency support personnel must attend upcoming Broadtower Underwriting Training Webinars

Hand on your heart — please commit yourself and your team members to stop this very expensive waste of administrative dollars and damage to bonus profitability!

The bottom line is LTCi protection is more important than ever for all concerned, and it is more difficult to obtain. We must continue to try to complete this arduous process successfully. We must work together to make certain that we can maintain the margins necessary to continue to help as many as possible. Your immediate help and focus on placement ratio issues is required.

Take The Pledge!

Profitable LTC Insurance Sales

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Traditional long-term care insurance placement rates have plummeted over the past 18 months due to more rigorous underwriting requirements. Declines on one spouse or the other and policies issued at rate classes greater than applied for have caused a spike in policies not taken or accepted by one or both of the insureds. The consequence of this is lost profitability to the producer and general agent. We spend untold hours running quotes on prospects without the faintest idea if they will qualify for coverage due to health reasons; additional time and resources processing the cases; and countless hours talking to underwriters on the phone trying to get them to change their minds in a no-wiggle room environment. Ultimately, the producer aggravates potential new customers or alienates existing clients.

The reality is that producers and general agents don’t make the rules. When companies across a market segment harden underwriting we have two choices; find another product to sell or adapt tactics. In light of the fact that many of us are committed to long-term care planning – how can we continue to help consumers in this difficult environment? There’s a simple answer; get better at field underwriting the clients’ health profiles before beginning the quoting process.

This not so revolutionary concept is easily accomplished by any producer or advisor. A brief review of one or two insurance company underwriting guides will provide the basic questions one needs to ask prospects and clients. Most general agent marketing teams also have a one page health questionnaire that can be used to guide producers through the primary issues that impact long-term care insurance underwriting decisions. The four primary items one must know are:

  • Height and weight;
  • Tobacco use;
  • Recent major health issues or surgeries that may be pending;
  • Current prescription medications being taken – very important as it is indicative of what may be ailing someone

With this basic information the general agent’s marketing team can zero-in on insurability and/or rate class. They can also recommend the insurance company that is most likely to look favorably on the prospect’s health issues. The producer appears professional because they’ve done some meaningful research for the client, and the chances of an unexpected underwriting decision are mitigated.

My marketing teams tell me that “producers just want to know how much LTCi costs”. Candidly we cannot answer this question, with a reasonable level of accuracy, unless we know what sort of health conditions the prospect may have. One of my mentors used to say that long-term care insurance is an inherently sub-standard market since we’re dealing with older consumers. This was when the average age of issue was 67. Today the average issue age is 56, but with modern medical technology and drug treatments disease processes are identified earlier and most people are taking some sort of prescription medication.

Doesn’t it make sense to ‘put the horse in front of the cart’ by getting basic vital health information from the prospect before a proposal is presented? Who wants unpleasant surprises after the fact? The process goes much smoother, everyone’s valuable time is not wasted and selling long-term care insurance becomes a profitable endeavor.

Lest We Forget…

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Recognizing the pressing need to increase long-term care insurance sales, our focus has turned away from “the date” that brought many of us to the dance. Bright shiny objects such as linked, hybrid and combo products, while adding to the consumer’s long-term care planning choices, has also created a bit of a muddle. The desire to sell “less to more” may be a great concept and the right thing to do, but the prolonged economic non-recovery and the increasing dollars sucked up by the Affordable Care Act have shoved aside the notion that middle-class consumers can squeeze another $100 per month for LTCi out of their budgets.

One thing that 39 years in the insurance business has taught me, is that we tend to forget what worked for us in the past. We get so wound up in the latest new product or untested sales idea that we stop talking to the right clients about tried and true solutions that work for them. As I look back on our past successes, the one that stands out is the 10-pay corporate carve-out sale for owners of small companies. In an environment of increased income taxes, what better way can a business man or woman protect their personal assets with tax-deductible premiums and tax-free benefits?

Now I grant you, this is not a mass-market sales idea. But if you have business-owner clients who are still making money, you know they are looking for tax-deductible ways to plan for their future. The good news is: you have a great way to help your clients do just that, and you don’t need many of these sales to make a significant impact on your bottom line.

Here’s what I’m talking about.

The most important metric to consider when presenting this option is:

How many years of annual premium does the total 10-pay premium equal?

For example, when Susan and I purchased our first 10-pay policy with Allianz in 1997, the total 10-pay premium equaled 19 years of annual premium. When we purchased our second policy with State Life in 2003, the equivalency was 23 years of annual premium. In the latter case (adjusting for benefits and age) we paid approximately $90,000 in 10-pay premiums from 2003 through 2012. If we had done this on an annual “forever-pay” basis the premium would be approximately $4,000 annually. I’m pleased to say that both of these were smart purchases. We now have more long-term care insurance than we’ll ever need, and the value of it increases every year because of the automatic benefit inflation option. And, our premiums will never increase because our policies are paid up.

In the mid-to-late 2000s, a number of companies jumped into the 10-pay arena, but they weren’t serious about selling much because total 10-pay premiums were equal to about 35 years of annual premium. So what happened? We stopped presenting them because the numbers didn’t make sense. We moved on to other ideas and failed to pay much attention to limited-pay policies. However, new developments make it highly desirable to reconsider the 10-pay option.

LifeSecure, one of our top traditional long-term care insurance companies, continues to offer a 10-pay option, and for the right client, total 10-pay premiums equals about 25 years of annual premium.

Here’s an example:

  • Couple 57 & 52
  • $6,000/month benefit each
  • Two $600,0000 pools of money + shared care benefit
  • 3% automatic compound inflation
  • 90 calendar day elimination period
  • Standard Rate Class
    • Annual “forever-pay” premium = $6,060
    • Annual 10-Pay premium = $15,096
      • Total of 10-pay premiums = $150,960
      • Equivalent to 24.91 years of annual premiums

 It’s important to note that the 10-pay premiums can increase during first 10 years of the policy, but after that the insureds are out of the premium-paying woods. The value of their monthly benefits and their pools of money continue to automatically increase by 3% compound annually for the life of their policies. If they own a business, they’ve paid the premiums from it, so all or part of the payments are tax deductible. Oh, and did I mention that the benefits when received are tax-free?

How would I present this idea to the client?

First I’d show the annual pay premium and get them to agree on the value proposition of what you’re proposing. Don’t forget to take along our Pool of Money presentations that shows they can’t invest their way out of the problem. Then as a final option, present the 10-pay premiums as perhaps a smarter way to go. Discuss the benefits and see what they say; you may be pleasantly surprised.

Now consider this:

Many small businesses have multiple owners who are struggling with paying higher marginal tax rates on income. If they convert some of that income to an executive employee fringe benefit, they would save on their taxes and protect their personal assets.

One more thing:

LifeSecure does not reduce the first-year commission when the 10-pay option is chosen. Renewals are reduced, however if you compare the total 10-pay vs. annual pay commission payout for the first 10 years of the policy the 10-pay beats the annual pay by 20%.

The conclusion is that for right client, the 10-pay premium option is a time-value of money winner for them and you.

The Top-10 Reasons That You Made The Right Decision To Attend The Broadtower Insurance Solutions 2015 Distributors Summit In Colorado Springs

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March 20-22, 2015 Broadmoor Hotel and Resort in Colorado Springs

    1. Meet and learn from top decision makers and thought leaders from Genworth, John Hancock, LifeSecure and Transamerica;
    2. Discover why the best days of long-term care planning are ahead of us.
    3. Attend and participate in a lively, entertaining and informative panel discussion on traditional and linked long-term care insurance underwriting featuring senior underwriting professionals from LifePlans, Mutual of Omaha, Genworth and John Hancock;
    4. Learn how to improve your agency’s placement rates and profitability.
    5. Find out how the latest agent training tools in the industry can motivate your producers and lead to long-term care insurance sales success.
    6. In a few short minutes discover the unique competitive advantages of the lead products that we sell and how best to position them in the marketplace.
    7. Learn how Broadtower Insurance Solutions can enhance your bottom line and how our added services, support and products can make long-term care insurance marketing and sales a larger part of your agency’s value proposition.
    8. Discover how our new members and relationships can enhance your agency’s offering and profitability.
    9. Network with your friends and colleagues.
    10. Enjoy the beauty of the Rocky Mountains the amenities of one of the world’s greatest resorts.

Click Here For A Complete Meeting Agenda

We look forward to seeing you later this month.

HIPAA And Compliance

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As you are well aware, compliance and HIPAA are high profile concerns of successful BGAs and their down lines.  We have put together a couple of related items for your consideration – take the time to review the content, and please forward to others in your agency who may benefit from the information…

Education: We found a good course that covers HIPAA thoroughly.  Here’s a blurb you can use as a template – modify it as you see fit to let your down line know the course is available and recommended: HIPAA Training – Privacy And Security For Business Associates / With recent changes to HIPAA laws now in effect, we highly recommend you consider a refresher course on the regulations.  The audio course is simple, easy to navigate, and takes just over an hour to complete.  During the course there are periodic exams, with a final assessment at the end – it’s a quick way to get up to speed on HIPAA regulations, and learn what it takes to remain/be in compliance.

Learn More Here

Among the items covered during the course are:

  • What is HIPAA
  • What is a Business Associate Agreement and what does it require
  • What is and is not considered Protected Health Information
  • When is an authorization required and not required
  • What is the law  – civil and criminal penalties

Technology: PaperClip has released a new, cloud-based email encryption program called Agent4. Agent4 allows you to send your clients’ private information in a secure email environment as well as stay compliant with HIPAA and FINRA regulations. Unlike other solutions such as Sharefile, Agent4 encrypts the text in the body of an email and the attachments.  Agent4 has an annual fee of $75 per email account – Broadtower has secured a 15% discount for the first year.

See Details Here

Sign up below and enter BROADTO2014 in the coupon code field.

Sign Up For Agent4 Here

Related Language For Use As You See Fit: HIPAA compliance looks differently and varies from producer to producer depending on whether they conduct business in paper-only, electronically or some combination of the two. Each business associate must individually assess their own office environment and how they conduct business. In every case, a business associate will need to be able to provide evidence that they have implemented and maintained appropriate administrative, physical and technical safeguards that protect the confidentiality, availability, and integrity of applicant and customer information and prevent prohibited uses or disclosures of that information. These responsibilities extend to applicant or customer information that the business associate creates, receives, stores or transmits either electronically or in a paper format.

We at Broadtower thank you for your efforts related to compliance and the protection of your clients’ personal data.

What Can We Do?

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In dealing with the day-to-day trials and tribulations of the insurance business, agents and advisers spend a great deal of time putting out the “fire” of the day. Over time, our primary job of helping customers identify and mitigate risk can blur as we go from one hotspot to another without asking the most important question, “What can we do for you that will help you sleep better at night?” After all, isn’t peace of mind the greatest service we provide?

In my small corner of the insurance world, we wring our hands about higher premiums, tougher underwriting, and worries about carriers staying the course. No doubt these are topics of interest, but obsessing on real or imagined problems robs us of the bandwidth required to provide some level of financial security in a rather menacing world. While most of our clients don’t have to worry about real lions and tigers eating them for lunch, they do need to be wary of not having the fiscal means to put food on the table or afford the care they need.

As our customer’s guide in the financial wilderness, job one is to help them identify risks and arm them with the weapons to fight the unexpected costs of a lost love one or a chronic medical condition. We can’t always provide 100 percent of everything our client needs or wants, but some protection always beats a blank. Getting better at helping consumers take incremental steps towards financial security is the world we live in today. The reality is that most consumers would be well served if they could at least co-insure many of the financial risks they face.

The good news is we have numerous options to supplement retirement income and savings and to ease the burden when long-term care is needed.

Here are some examples:

  • A traditional LTCi policy with a two-year benefit and a future purchase option;
  • A term or permanent life insurance policy with a chronic illness accelerated death benefit;
  • A critical illness policy that fills the gaps in care provided by today’s health insurance plans;
  • Reposition a rainy-day fund into a life or annuity product that provides long-term care benefits;
    • Great 1035 Exchange opportunities here; and
    • Some annuities provide simplified underwriting for tough cases

Sometimes an incremental strategy of small risk management solutions is the best option for consumers who are struggling with other financial obligations. Don’t overlook these mid-market sales. They can translate into sustained serious income for you and along the way, you may get the “elephant” that you’re hunting for.