Alright, got your attention. Maybe it’s only a global catastrophic risk. Everyone will of course reach a conclusion to life’s finite journey, our industry is built along the certainty of that occurring on a virtually unpredictable timeline.
Perhaps it’s time once again to take stock. I believe we have earned the right to reflect. It’s just too easy to lament the worn out cliché concerning history repeating itself. Fashion may be cyclical on skirt length but we should not expect the return of dayglo ties or pet rocks. The insurance challenge of increasing length of life and the necessity of senior care is a worldwide problem. You must hold this one thought front and center in your mind that the cost of caregiving is indeed poised to wreak havoc with global economies. The reality that this overwhelming threat of financial and subsequent emotional distress will simply not go away. It must hold a permanent place in all your sales planning.
No one would choose institutional care as their first option. It would have to be the last choice or the only one available. In 2024 the estimated cost of home care is $61,000 annually, yet those providing that mandatory assistance have the most underpaid job in the world. I’m not sure you are thinking this through when estimating the size of the problem. To my knowledge none of existing reimbursement or indemnity policies with the rare exception of pure cash policies with no strings attached allow for non-certified assistance. The administration overhead for qualified caregivers basically doubles the labor cost. Because the actual net pay to the caregiver is so low the national employee turnover rate is 60 percent. Now imagine every industrialized nation on earth struggling with their current problem and trying to plan for a bleak future. A future where robots and AI are only putting fingers in a dam which may breach at any moment. To put a fine point on it, in 2026 the senior global health care cost is estimated at $213.9 billion.
Current sales behavior is valiant and greatly appreciated by all the down line family members that may now have care financing options when they are most in need. Truthfully carrier retreat from the market, onerous rate increases and structural delays in claim payments have made what has been historically a very difficult sale into one that is virtually impossible. I remain one of those old guys that prefers a direct approach to any insurance conundrum. I am also one of those who admires those who can load up the sales and benefits boat before its launch. Forgive me for reminding those loyal sailors to the cause that riders only dramatically add a counter balance to the scales of benefit justice. Morbidity and mortality risk will never come out equal when artificially bound together with one finite outcome. What deserves consideration is that maybe that’s OK. Now this is the exact place where my concern for our future perception by consumers comes into play. None of us should care where the source of the funding for care giving resides but will those benefits be paid in a timely and caring manner.
I know it’s now time to pass this struggle on to the next generation of sales professionals. I know that product alternatives may be at an all-time low. However, I also wish to extend my most heartfelt thanks to the carriers who continue to stand each day with the anticipation of explaining what I have outlined.
- The risk is real. It is growing exponentially.
- The quality of care that the great and vast majority of our consumer market will receive will be paid out of personal reserves and/or some level of managed insurance.
- The Long Term Care Conundrum has not gone away; it is bigger and more menacing than ever.
Other than that I have no opinion on the subject.
