Hey, good morning everybody, this is Mike Baker, sales manger for the Long-Term Care and Ancillary department with Ritter Insurance Marketing. Appreciate you joining me today, I want to talk to you a little bit about the evolving long-term care market with regards to solutions. You may or may not be aware of everything that’s out there on the market today, but at least wanted to get it out, so that you’re out there talking to your clients. You’re at least better prepared to maybe recognize the opportunities that are available for your clients. And that obviously will allow you to better serve their needs. Gonna cover a lot of information in a short period of time, but just to kind of establish the fact that the good news is we’re living longer. But, the bad news is, we’re living longer. So the more likely it is that the longer we live that we’re going to need some type of care. But, contrary to that, when we do associate long-term care with maybe something that happens as we do grow older, you know, the fact still remains that 40% of people needing long-term care services are under the age of 65. So, long-term care can affect anybody at anytime at any age, regardless of their health, regardless of their age, so again, just kind of keep that in mind and don’t pigeon-hole long-term care as maybe just an older-age type of an event. But the other thing to think about is, you know, really truly is the single greatest financial risk that folks face as they grow older. But unfortunately, you know, it’s the one risk that most folks haven’t done anything about, so. The good news is, there really truly has never been a better time to be talking with our clients about long-term care. What really drives that long-term care conversation for most clients is a personal experience. And, you know what I have found is that more people that you talk to today have a personal experience, family member, friend, somebody that they’ve known that’s needed some type of extended care. So, extended care being home health care, assisted living, adult daycare, or skilled nursing care, so that personal experience really drives the conversation, the more people who have had a personal experience. Again, as I said earlier, the other thing is that we’re living longer, and the longer we live, the more likely it is that we’re going to need some type of care, and regardless of everything that you may have heard or know about what’s going on in the traditional long-term care space, you know, the cost of care continues to rise, it’s not going to get any less expensive, the risk is only going to increase, modern medicine and technology is allowing us to live longer and live longer with chronic conditions. So it really is imperative that as advisors, we recognize those opportunities to better serve our clients. And as I said, you know, the number of solutions that are out there on the market today has really evolved considerably in the last 20 or 25 years. What originally started as just a, maybe a traditional market space has evolved now with the linked benefit products, the life and long-term care products, the annuity long-term care products. Most life carriers now, if not all life carriers have some type of a long-term care or chronic illness rider. And then the other one that we do talk about a little bit about, because it’s kind of forgotten in some cases is that short-term care solution. You know, there really are five different types of solutions that we have to offer our clients, and regardless of their health and wealth, one of those five solutions can probably bring some level of benefit, albeit maybe just a homecare plan on the short-term care side, so. What I really want to kind of focus on today. Maybe a little bit moreso is on those linked benefit products, but the first step that I can’t really stress enough, is just being able to prequalify that client. The more information that you can get up front with that client with regards to their health, the better job that we can do in pre-qualifying those clients. Because at the end of the day, that’s really going to, to some degree, dictate maybe where we’re able to go from a solution perspective, so we do have a worksheet that you can use to gather that medical information to pre-qualify those clients, you can find that on RitterIM.com. We can certainly e-mail that to you as well. But again, with regards to that linked benefits base again, a very broad market when you think about the linked benefits as well as the life of the accelerated rider, so. Really, it kind of broadens that market from anything from, frankly down into the thirties the whole way up into age 80, so again, very, very broad market. With regards to the linked benefits, you know, again, probably more of a middle market, upper income, higher net worth type of market there. You know, folks that do have assets that they don’t necessarily need from an income perspective that could potentially be repositioned either as a single premium, which the link benefits historically had been, maybe a single premium product, but I think upon further review that you would find that what’s happened with that evolving market is there are far more opportunities for clients to reposition assets over an extended period of time. Ten years, fifteen years, twenty years, pay-to-age-65, one carrier even has a lifetime. Another carrier now is offering a pay-to-age-100, so we’re probably seeing as much if not more opportunity on those limited-pay options as we are on the single-pay options. So, again, a very broad market, not just from a single-premium perspective, but also from a limited-pay perspective as well. So if you have clients that are, you know concerned about “What if I never use a traditional long-term care product.” “I think I could self-insure this risk myself.” “I’m concerned about rate increases.” Maybe they were declined for traditional long-term care. Or they’ve looked at traditional long-term care before, but it’s been a while. You know, these are all signs of a client that you know, may be more apt to have a conversation with regards to those linked benefits because frankly the linked benefit product, whether that client lives, and needs long-term care, dies, and never needs long-term care, or they just decide to walk away. The linked benefit product is going to provide a benefit whether they live, die, or quit. That’s really the appeal there, so there’s still a market for the traditional product, but because of the evolving market, the number of carriers that are actually entering that space, the way that the policies can now be designed or structured, you really can accommodate far more opportunities with your clients to position one of those linked benefit products. You know those funding sources could come from anything from just cash, checking, savings, CDs, money markets, uh, we have the ability to fund these products with a non-qualified annuity. We have the ability to fund these products with tax-qualified money. So, you know again, there is a lot of opportunities, regardless of you know, maybe where those client dollars are. To be able to come up with a solution with one of those linked-benefit products. The advantages for you as far as from a broker perspective, is you know, nobody likes to be in that position where you’ve sold somebody that traditional long-term care product, and now have to go back and have that conversation about you know, the significant rate increases that we’re seeing on those older traditional products. And I will touch on that here in a moment, that you know, the traditional space obviously is kind of going through, there’s a lot of fluidity as I like to say in that market. But, you know, the traditional products are more appropriately priced today, but again, as I said, I’ll touch on that here in a second. Again as a, from a broker’s perspective, the advantages, there’s far less risk. You know, those linked-benefit products, the premiums are guaranteed, again, if your client never needs it, they get, there’s a tax-free death benefit, less any long-term care claims. If they do need long-term care, you know, depending on their age, they can get some significant dollar leverage for long-term care, uh, potentially as high as six or seven times leverage on those dollars. And again, if they decided to walk away, there’s a guaranteed return of premium, so, the client is going to have more buy-in, and sometimes if there’s other decision makers involved in that process, you know, maybe spouses, obviously, kids involved in the decision making process. For those kids, knowing that, you know, mom and dad, or even themselves, somebody is going to get a benefit from those products. There’s more buy-in from all of those decision makers. Underwriting can also be, maybe less stringent, or a little bit easier process, unlike that traditional process that’s a much deeper dive. On a traditional space where you have to go out for an APS and the phone interview, and could have a very protracted underwriting process. In the linked space, in many instances it’s simply a phone interview. So once that ticket, or that application hits the carrier, the client gets the phone interview, you know within a matter of a couple of days, or in a relatively short period of time, we can have an underwriting decision. The good news is, we also have a carrier that will do full underwriting. So, while full underwriting can mean a more protracted process, the good news is, it does allow them to take a deeper dive, and in some instances, we may get more favorable underwriting with full underwriting on a linked benefit product. So, again, that could be an advantage, but again, I go back to that pre-qualification, why it’s so important to get as much medical information, because we want to make sure we’re positioning the client with the best opportunity, to have a favorable outcome and we don’t want to put you as the advisor, in a very awkward position, you know to have to go back to the client and basically say, we’re unfortunately, you’ve not been approved because had we known that information up front, we may have been able to avoid some of those uncomfortable situations, so as I said, from an underwriting perspective, these hybrid products can certainly be more favorable for you as an advisor because the underwriting time cycle is much shorter. It is also much more favorable for the client because you don’t have that protracted process, so all-around, it could be a much more favorable buying experience for both you and the clients. So keep that in mind and again, you know, as we kind of go through this information, you know, there’s obviously, we’re just kind of touching on the tip of the iceberg. Which is really the intent of this, is just to kind of give you a general perspective, kind of put it out there on the radar. Not expecting that anyone is necessarily going to become a quote unquote product expert, but hopefully what you’ll become is an opportunity expert. And that’s the ability to recognize the opportunity with the client, when these types of products may be a good fit, and then know that you have the ability to give myself and my team a call here at Ritter Insurance Marketing. That we can step in and be that resource for you. And kind of before I close, I do want to just touch briefly on that traditional space because of how fluid that market’s been over the last several years. You know, again, as difficult as that market has been and the challenges it has created for the clients, and for us as the advisors, the important thing to know is, there is still opportunity with traditional long-term care products. So don’t just discount those as a potential solution. While those products have gotten much more expensive, which is kind of the bad news obviously, the good news is, they’re more expensive, so they’re more appropriately priced. So the likelihood of seeing those significant rate increases like we’ve seen on the old products in the past, are probably less likely. Again, the pricing assumptions are far more current, obviously, that what were on the old products, so again, when you kind of wrap those things up, again, you can feel good about still positioning a traditional long-term care product with your client, and we do have a traditional long-term care carrier that does offer a return of premium, less long-term care claims. And an optional surrender rider, so you can essentially create a linked-benefit-like solution using a traditional product. So keep that in mind that that still may be a very viable option. So, in closing, I always like to close with a quote, that I came across from Abraham Lincoln, which I thought was so appropriate, relative to the long-term care space. And his quote is “You can not escape the responsibility of tomorrow, by evading it today.” And when you think about that long-term care conversation, nobody likes to talk about long-term care, and what can happen, and the consequences, but not having that conversation today doesn’t mean that it’s going to happen. So, again, appreciate you joining me today, hopefully you got a couple of things out of our little talk this morning, certainly welcome the opportunity to have any further on-going conversations, provide more information. So give me a call, again, Mike Baker, sales manager, long-term care and ancillary department here at Ritter. Give me a call, 800-769-1847, my extension is 262, or my email, [email protected] Again, thanks for joining us, have a great day.