When you work with clients on financial planning, one gap you will find in Medicare policies is the lack of long-term care (LTC) coverage. This can create problems; as your clients age, their likelihood of an LTC event increases. Whether sickness, injury, or just old age comes into play, most people will at some point depend on assistance with daily living tasks.
You can provide an important solution to this problem by providing an LTC insurance option to your clients. In doing so, though, you will need to address some common misconceptions they have, and be prepared to deliver the facts they need to make an informed decision.
Myth: LTC Events Are Rare
The most important myth to overcome about LTC insurance is that most people will never require long-term care. Many of your clients view this as the problem that will never happen for them. Truthfully, this is why people might pass on other kinds of insurance as well; they assume that the odds remain in their favor, and that the coverage represents an extravagance.
Unfortunately, this is misguided. The U.S. Government estimates that 70% of people will require some kind of long-term care in their lives, with an average duration of three years. Your clients are thus more than twice as likely to need care as they are to avoid it.
Myth: Savings Are Enough
Even when your clients accept that they may need care, many of them focus on savings as a vehicle to prepare for that need. Rather than pay for an insurance policy that may not kick in for years, they prefer to save money for that rainy day, and keep the cash in case they beat the odds.
They may be right; many LTC insurance policies sit unused for a long time. But when the moment comes that care becomes necessary, Long-term care can easily cost thousands of dollars per month. Savings accounts by themselves can be depleted quickly, particularly if the need lasts for several years. With life expectancies higher than ever, the need for care can outlast the funds your clients reserve.
Myth: Family Can Pick Up the Slack
Many people believe their families will care for them if something happens. And again, many family members will gladly make the sacrifice. If your clients need help with grocery shopping, meal preparation, or even dressing and bathing, they may have willing help.
But what if the need stretches out? The opportunity to help can change into a burden, one that grows heavier over time. This becomes a great deal to ask of family members from a time perspective. And if a sickness or injury is involved, they still need professional care outside of the hospital to treat wounds or provide other medical-related care. It quickly becomes too much for a person to leave to family members who have their own lives to lead.
LTC Insurance Products
Medicare does not cover LTC insurance. You thus need to move beyond basic coverage to account for the long-term care needs of your clients. If you provide traditional LTC coverage, or an LTC rider on a life insurance policy, you can help your clients prepare for a situation that is more likely to occur than not. These products help make the difference between providing your clients with the basics and providing them with the services they really need.
