ABLTC Underwriting Niches for ForeCare
As we approach Long-Term Care Awareness month, we want to provide you with some key facts we have been seeing this past year in the Asset-Based LTC product segment:
Upward trend in the need for Long-Term Care planning – due to a rapidly aging population and folks living longer, this gives ways to higher demand and continued cost increases for Long-Term Care Services.
Average out-of-pocket costs are $140,000 for those individuals who utilize paid LTC. Roughly 17 percent will spend over $100,000 on LTC. Almost 9 percent will spend over $250,000 on LTC.
69.5% of new claims start after the policyholder reached age 80. If your clients live a long life, they are very likely to need long term care!
Improving Interest rate environment - with interest rates starting to move at the beginning of this year, this has led to multiple pricing improvements as well as better performance on the Asset-Based LTC plans.
With all that is going in this product segment, I would be amiss to not remind you that while these products use simplified underwriting, we have still been experiencing unnecessary postponements/declines. I can’t tell you how many times I get that call for help on a case that has been declined. Once this happens, it becomes challenging to find another viable option for those clients. With that, I want you all to be prepared if you are having conversations for Long-Term Care planning by following 2 simple guidelines when preparing a Long-Term care solution for clients:
Pre-qualify clients - whether they tell you they are in good health or great health – and here’s why:
Without pre-qualification – you risk a chance for a postponement or decline and limit product availability for another viable option
Most Life-ABLTC carriers do not want to review these cases while the Annuity-ABLTC carriers may require a 12-month waiting (excluding: CA)
With pre-qualification – you increase the chance for policy placement and narrow down the time spent in reviewing various options
Depending on clients pe-qualification outcome – use the attached Niche underwriting tool to see if the client may qualify for the Asset-Based LTC Annuity (2 attachments)
Attached below see Global Atlantic’s ForeCare ABLTC Annuity Niche Underwriting tool along with a pre-qualification form. This was designed to assist advisors on identifying case opportunities for those clients that may already be a postponement or decline for either an LTC rider or for the life component ABLTC plans.