How to implement LTC insurance into your practice Steve Jones, CLTC Senior Marketing Manager John Hancock LTC insurance For financial professional use only. Not for use with the public. Long-term care insurance is underwritten by John Hancock Life Insurance Company (U.S.A.), Boston, MA (not licensed in New York) and in New York by John Hancock Life Insurance, Boston, MA LTC /11

Agenda Getting started How to start the conversation The Three-Step process Things to consider when recommending a plan Tips and training

Getting started How to have a productive long-term care discussion DO Build a simple process for your business Talk to ALL clients about the importance of a strategy Do not get into product details Have a conversation about living a long life and the impact a large medical expense can have on a retirement plan DON’T Filter out clients to find the select few who “need” it Assume clients can self-insure Refuse to discuss it because it is embarrassing, complicated, expensive, “my clients are not interested,” etc.

Start the conversation Develop a “30 second sound bite” –“High cost, high probability event, that is unprotected, we should get together to discuss your situation” Or ask open-ended questions –“Have you thought about the consequences to you, your family, and your financial plans if you live long enough and need care?” –Personalize it When –Annual review –When they call to ask for something else –At a client seminar

What do I say? Mr. and Mrs. Client, I was reviewing your file today and noticed that we had not discussed a topic that I am dealing with more and more in my practice. I think it is an important part of the planning process we have committed to. What are you presently doing with regards to long-term care planning? Mr. and Mrs. Client, have you and your family members discussed how you might handle the emotional and financial impact if one of you suffer from a long-term illness?

What do I say? Mr. and Mrs. Client, assuming that long-term care costs here in our area are “x” annually, have you thought about how you might handle those expenses should you or a family member need care? Mr. and Mrs. Client, if something happened yesterday that caused you to need long-term care services in your home or some other setting, have you given any thought to which of our investments we might begin liquidating to pay for your care?

What do I say? However they may respond, your goal is to obtain an appointment. Transition using the phrase: I can appreciate that and promise you that will be one of the first things we discuss when we meet to review this topic. With that in mind, are afternoons or mornings more convenient?

The Three-Step process Step 3 Help protect the strategy Establish why LTC insurance may be the best option Recommend a policy Step 2 Establish that long-term care is a family issue Allows you to put together a strategy Step 1 Establishing a Need Personal experiences

Step 1: Establishing the need Introduce appropriate information –Define what long-term care is –Explain the difference between activities of daily living (ADLs) and a cognitive impairment –Explain care provider and levels of care –Provide examples of where you can receive care Do you have any personal experience with long-term care?

Step 1: Establishing the need Do you know anyone who has needed long-term care in the past, or is currently receiving care? –What was the reason for the stay? –How were the finances handled? –How long was there a need? –How did it affect the family? –Was the need expected or unexpected? Additional questions to tie back to the client –Given the choice, where would you prefer to receive care if you ever need it? –What concerns you the most about long-term care? Be prepared to share your own story

Step 2: Develop a strategy for care The effects of long-term care on the family Establish a foundation for discussing how to plan Recommend a strategy Long-term care is a family issue Family members may often assume the burden of care Over time this may have a significant impact on their: –Lifestyle –Personal and work commitments –Physical and emotional well-being

Step 2: Develop a strategy for care Given the choice though, most people needing care may prefer family members to remain companions rather than caregivers Wouldn’t you agree?

Transition to recommending a strategy Who will help if you need care? Have you discussed this with your family? Where would you like to receive care? What has been allocated to pay?

Considerations Single and no children Staying at home may be limited Assisted Living is an option Married and no children Staying at home is an option if spouse is healthy Assisted Living is an option Married with children Best possible scenario for home care Assisted Living is an option Divorced/Widowed with children What is the relationship like with former spouse? Is Home Care an option? Assisted Living is an option

Step 3: Helping to protect the strategy Not an option Health Insurance Government Programs Not a reliable funding source Personal Assets Not the intended purpose LTC Insurance May be the best option

Things to consider Product presentation must focus first upon “core” product building blocks Five basic building blocks or key choices 80% of product presentation is LTC insurance Benefit Amount The Benefit Period Inflation Options Elimination Period 20% of product presentation Optional Riders

Possible recommendation: LTC insurance For a couple Benefit Period4-yearBenefit Amount$6,000 per monthInflation OptionCPI Compound InflationRidersSharedCare

Your goal To motivate your client to take action today –Encourage prospect to make a decision –Explain the application process –Take LTC insurance off the “Good idea shelf”

Tips and training Two critical areas of the presentation –Ability to answer customer concerns –To ask for the business Rarely does a client not raise concerns Concerns are normal and come from many sources Real concerns merit an answer When concerns are removed, the client is usually open to moving forward with the recommended solution Overcoming objections –No need? – personal experience, getting agreement –No money? – fact finder and funding options

Tips and training Use your wholesaler Training Point of Sale work Key talking points Referral techniques

Conclusion Have the conversation with all of your clients Develop a “30 second sound bite” Establish the need and create a strategy Protect that strategy Utilize your John Hancock wholesaler

Thank you