Starting The LTC Conversation

How many times have you heard clients’ concerns about the cost of Long-Term Care Insurance?  It is the single most common objection, but this objection can be overcome by understanding the underlying issues at work here.

If your clients are like most, they do not think they will ever need LTCI, and they do not really understand what they are getting for their money.  So how can you help them overcome these misconceptions?  This requires asking some very specific questions.

Many producers make the mistake of showing an illustration too soon – the premium then becomes the problem instead of the solution.  You must first develop the need.

Try starting with
  • What is your written plan of care should an extended health care need arise?’’  The majority of people do not have a plan, other than thinking their family will take care of them.
  • Your follow up to this response should be, I am happy to hear you have such a wonderful family that wants to be there for you, but have you had this conversation with them?”  Most likely, this has never even crossed their mind.
  • Then if applicable ask, “Are all of your children employed?”  And if so, Which one could afford to cut back on their work week, or quit all together to provide needed care?
  • The next question is critical and must also be asked.  “Which one of your children do you want to do your bathing or toileting?”  Follow up with, Wouldnt you rather have a trained professional come in and take over that burden, freeing up your family to spend quality time with you and allowing you to maintain your dignity and independence?’’

The purpose of this dialog is to get your clients to really understand what care giving encompasses.  It is at that point they realize the true value of a LTC policy.

While the life insurance sale is a very logical one, the LTCI sale is unique, as it is an emotional sale.  When an extended health care need arises, it is an emergency, not a planned event.

A LTCI policy not only provides financial support, it also provides much needed emotional support for the family members dealing with the emergency.

If and when a person becomes ill, there will be a need for care and a way to pay for that care.  A Long-Term Care Insurance policy is the most cost effective way to provide for that.  The premium is not the problem – the premium is the solution to the problem.  If you can get your clients to understand this, you will get the sale.

Contact your LTCI Specialist today for more ideas on how to develop the need and start closing more business!

4 Ways LTC Insurance Provides Tax Advantages

When meeting with clients to discuss the benefit that a Long-Term Care (LTC) Insurance policy has on their overall financial plan, tax deductions might not be the first thing you emphasize, but should be one of your top five discussion points.

Taking the time to explain the tax advantages may provide the tipping point for clients who are hesitant about purchasing a policy.

Here are a few scenarios on how to approach each type of client:

The client that is on the fence

Many states offer a deduction or credit on paid LTC Insurance premiums, which can make purchasing coverage more attractive to your clients.  For example, in the state of Ohio, residents are able to deduct the entire annual premium for their LTCI policies on their tax returns.

The Planner

If you are working with clients on their tax strategy, consider turning their tax refund into an LTC Insurance premium payment.  It’s a great way to plan for the cost of the insurance and can make annual premium payments a non-event.

Business Owners

When a C-Corporation purchases a policy on behalf of its employees, and their spouses or dependents, the corporation is entitled to take 100% deduction as a business expense on the total premiums paid.  If self-employed, clients can deduct 100% of their out-of-pocket LTC premiums up to the age-based Eligible Premium amounts*.

Current Policyholders

Clients who already have an LTC Insurance policy may not know about the tax deductions available to them.  So during your annual review, be sure to educate them about a missed opportunity to take a tax deduction.

Contact your Long-Term Care Specialist today to learn more about the tax advantages of LTC Insurance.

Long-Term Care: The Cost Of Waiting

Your clients often think they will not be among the 75% of people who need Long-Term Care sometime in their life.  They put it off thinking they don’t need to purchase protection until it actually happens to them.

Unfortunately, waiting to purchase coverage could mean they pay higher premiums or they could even be denied coverage.

Time vs Cost

The two most important factors that determine the cost of an LTC Insurance policy are the age and health of the applicant.  That’s why it is important for you to remind your clients to start planning early while they are young, healthy and able to take advantage of more favorable rates and discounts.

Show your clients the difference in cost and explain to them that waiting even five years to purchase coverage could mean higher premiums, additional underwriting and a decreased opportunity to qualify for preferred rates.

For more information on approaching your clients about Long-Term Care contact your LTC Specialist today.

Why Tax Season Is The Optimal Time To Discuss Long-Term Care Planning

Tax season is in full swing – people across the country are in the midst of preparing and filing their returns.

But did you know it’s also an opportune time to talk to your clients about the vital importance of Long-Term Care Insurance?

There are numerous tax-related benefits that come with LTCi.

For example, LTC Insurance premiums may be tax deductible.  Clients may be eligible to receive deductions or credits on their state tax returns for paid LTC Insurance premiums.

Plus, tax refunds are a great way to pay into LTC Insurance premium payments.  Doing so on an annual basis can make paying premiums a non-event.

LTC Insurance is often the missing piece in many financial plans – and tax preparation provides the opportunity for your clients to review their financial plans and identify any gaps in their coverage.

For more information on the potential tax benefits of LTC Insurance or for additional information contact your LTC Sales Rep.

How LTC Insurance Can Lower Your Clients’ Tax Bill

How do you get people to sit up and take notice?  Talk taxes.  Tell them you have a way to help them reduce their state and federal tax bill.

A Long-Term Care Insurance (LTCi) policy has the potential to help people lower the amount they pay in taxes.

And at the same time, LTCi provides valuable insurance coverage that can help them remain in their home, protect their retirement nest egg and ensure they won’t have to rely on their kids to take care of them.

LTCi Premium May Be Tax Deductible

Each year, the federal government sets guidelines for tax deductibility.  Individual policyholders may be able to deduct a portion of the premium paid for a tax-qualified LTCi policy.  This is called eligible premium.

Business owners who use business dollars to purchase LTCi can also experience significant tax savings based on the tax structure of the business:

  • Self employed business owners may deduct eligible premium paid for the owner, spouse and dependents.  They also may deduct the total premium or actual premium paid for employees.
  • Owner/employees of C Corporations may deduct actual premium for the owner/employee, spouse, dependents and employees.
Policy Benefits May Be Tax Free

Benefits received under a tax-qualified LTCi policy are intended to be tax-free as long as they do not exceed the greater of actual qualified LTC daily expenses or the IRS’ per day limitation.

Out-of-Pocket LTC Expenses May Be Tax Deductible

Generally any LTC expenses the policyholder pays out-of-pocket may be claimed as a medical deduction on a federal income tax return.  The only exception is payment for home care provided by a family member who is not a licensed health care professional.

Some States Also Offer Tax Deductions

Currently a number of states offer tax deductions and/or credits for people who purchase qualified LTC Insurance policies.  And these state deductions and credits are in addition to those offered by the federal government.

There’s No Better Time to Talk Taxes

Everyone is looking for ways to save, which is why now is a good time to talk to prospective clients about the tax advantages of purchasing LTCi.  They’re sure to be more receptive when they learn that purchasing the coverage they know they need also can help them reduce their tax bill.

For more information, contact your LTC Specialist today.