“Brother Can You Spare A Dime…?”

I can remember the sheer terror that accompanied gasoline prices cresting the $1 per gallon mark back in the 70s just in time to accompany my foray into the driving world. I can also remember paying over $4 per gallon while living in Richmond, VA, some fifteen years ago. Today, when I go window shopping, I regularly see new car prices that eclipse the purchase price of our first home while I was attending law school back in the early 1980s.

Surprisingly enough, even with rising health care and custodial costs, and the heretofore referenced regular costs of living inflation, total annual premiums for long term care insurance policies sold continue to decline! Are rates being reduced by the carriers? Not that I have heard. Have underwriting conditions and actuarial projections reduced the costs associated with owning a policy? Hardly. Has the cost of care declined? Nope; a steady increase of about 3.9 percent per year has pretty much been the norm. So, what has driven the amount of premium on the average policy to decline? I suspect that it is fear. Fear? Fear. Fear of not making a sale, fear of scaring away a prospect, fear of facing clients and addressing topics such as in force rate actions.

If that answer comes as a surprise, an alternative answer could also include poverty consciousness and fear, with both elements squarely in the hearts and minds of the insurance producer offering long term care protection to their clients that simply may not be enough coverage.

What do I mean by poverty consciousness? Simply put, it is the inability of the insurance producer to get beyond his or her own myopic vision on what is or is not an affordable premium to pay for this invaluable protection. If I just struck a nerve and you are one of these producers who cannot imagine collecting, much less personally writing, an annual premium check of $6000 to $8,000 for long term care protection that provides coverage for two clients with a monthly benefit level for each of them of approximately the same value, then we have identified the problem.

I have always likened a shared (or joint) plan that covers two parties with a monthly benefit for each party equal to the premium for the plan as a great plan as it then affords me the opportunity to ask the question, “Would you rather write this check once a year or twice a month?” It is a very powerful illustration of the way clients can leverage their money in ways that may never have occurred to them or their financial advisor.

So, unless you are independently wealthy, or living on the fruits of a multi-million dollar book of business generating a six-figure stream of renewals, or have a spouse with a large income, or inherited a nice chunk of change, I would encourage you to lose this fear or reticence and do, once and for all, shed your poverty consciousness. The discussion with our clients needs to be one focused on risk and consequences. If they are not receptive to the probabilities associated with this great need, then be prepared to pivot to the concept of consequences. “Okay George, I really believe that you believe that you will be in that lucky 10 percent that does avoid the need for long term care in your own life—but what if you are wrong? What are the consequences to your spouse, your family, your finances, and the legacy that you wish to have survive you?

Fortunately today, in addition to traditional stand-alone long term care insurance policies, we can now offer the alternatives of asset-based products, life with long term care riders, as well as annuities with long term care provisions.

If you are suffering poverty consciousness, the best advice I can share with you can be summed up in three words: Get over it! As my good Italian friend would advise: Fuhgeddaboudit. The disservice you do yourself is only eclipsed by the disservice you do your clients. Remember that in addition to being a word, fear can also be a mnemonic: FEAR—False Evidence Appearing Real. Don’t fall into this trap.

Don Levin, JD, MPA, CLF, CSA, LTCP, CLTC, is chairman of the board of the National Long Term Care Network and the managing general agent of PNW Insurance Services, a national brokerage which offers long term care insurance, short term recovery care, life insurance and annuities to the general public across the country. The long term care planning specialists and staff of PNWIS are proud to offer comprehensive individualized planning solutions to their clients while also working through a strategic alliance of financial planners, estate planning and elder law attorneys, CPAs, and other businesses and organizations.

Levin has been in the long term care industry since 1999, during which time he has been an award-winning agent, district manager, regional sales manager, marketing director, associate general agent, general agent, and divisional vice president. Levin is also a former practicing Attorney-at-Law, court-appointed arbitrator and is a retired U.S. Army officer.

In addition to his various law and life and health insurance licenses, and the above designations, Levin has also earned Green Belt certification through GE’s Six Sigma program, and is a graduate of GAMA International’s Essentials of Leadership and Management. He has also taught Managing Goal Achievement®, Integrity Selling® and The Way to Wealth® to hundreds of leaders and salespeople over the past fifteen years. He previously possessed FINRA Series 7, 24, and 66 licenses.

Levin earned his Juris Doctor from The John Marshall Law School, his MPA, from the University of Oklahoma, and his BA from the University of Illinois-Chicago. He is also a graduate of the U.S. Army Command and General Staff College and the Defense Strategy Course, U.S. Army War College.

He is a published author of nine books in a wide range of genre.

Levin may be reached via telephone at (509) 348-0206. Email: dlevin@pnwis.com.