Best Practices for Selling Group LTCI

Help your clients execute a successful enrollment by encouraging them to emphasize the value of buying LTCI at the workplace.

By offering group long-term-care insurance (LTCI) benefits, employers have a unique opportunity to give their employees the tools to manage through potentially life-altering, long-termcare events. Brokers are in a unique position to advise their clients on how to conduct a successful enrollment.

Chances are good that long-term care will touch most Americans either as care recipients or caregivers, but long-term-care services can be expensive and, contrary to belief, are generally not covered by health insurance or Medicare.

According to Genworth’s 2016 annual Cost of Care Study, the cost of long-term care continues to rise across most care settings year over year, especially for services in the home, where most people receive care. Nationally, the median monthly cost for the services of an in-home health aide for 44 hours is $3,861. The national median monthly cost of a private nursing home room is $7,698; assisted living, $3,628 per month; and adult day services, $1,473 per month.

Group LTCI can help provide LTC protection for employees as well their immediate families. It can go a long way to help ease the emotional, physical and financial burden of caregiving on employees, as well as the potential financial impact on employers.

According to the 2015 report “Caregiving the U.S.,” six in 10 caregivers reported being employed at some point in the previous year while caregiving. Twenty-five percent were millennials, and half were under the age of 50. Among them, 56 percent worked full time.

The best enrollment results have been achieved when an employer makes full use of marketing resources, branded with the employer’s logo.

Why should employers care?

When employees are trying to juggle the demands of caregiving — often caring for children and parents at the same time — productivity and morale can suffer.

Perhaps the best news of all is that employees prefer to purchase LTCI through their employer.

According to our own internal consumer research, three out of four consumers said they would prefer to buy LTCI through their employer. The primary reasons they cited? The insurance had already been vetted by their employer, and it could be obtained by the employee through a simplified underwriting and application process.

Best practices for successful enrollment

Brokers can help their clients execute a successful enrollment by encouraging them to emphasize the value of buying LTCI at the workplace. These include:

• Full portability – In our internal consumer research, consumers viewed being able to take the coverage with them when they change jobs or retire as the most attractive feature of group LTCI.

T hree out of four consumers said they would prefer to buy LTCI through their employer. The primary reasons they cited? The insurance had already been vetted by their employer, and it could be obtained by the employee through a simplified underwriting and application process.

• Fewer underwriting requirements

– Because group LTCI is, in part, underwritten at the group level, fewer underwriting requirements are needed at the individual level for employees during initial enrollment.

• Online enrollment – Consumers we surveyed liked the idea of being able to learn more about LTCI, estimate costs and apply online.

• Family coverage – While underwriting requirements are generally more stringent for relatives of employees, spouses, parents, grandparents and adult children may also be able to take advantage of the group pricing, even if the employee chooses not to enroll.

• Easier payment options – Employees can pay premiums by payroll deduction, if offered by the employer, electronic funds transfer or direct bill.

• Affordability – In most employer group plan designs, employees can start small, buy a modest amount of LTCI and then add to their coverage over time as their budgets permit. In our experience, the best enrollment results have been achieved when an employer makes full use of marketing resources, branded with the employer’s logo, such as internal announcements, newsletters, webinars, onsite informational meetings and reminder emails. Many carriers also offer customized employer websites, which can be great sources of valuable information for employees.

Benefits for all Group LTCI is often a direct sale between the insurer and the insured, often through an enrollment website. For brokers, this means they can concentrate on helping the employer build benefit plans that are valued by employees instead of gathering applications for one specific plan. Since brokers are not involved in taking individual applications, as they are with individual or “list bill” individual plans, broker resource requirements for training, licensing and travel are minimized. This is a special advantage for brokers with large employer groups that span multiple states.

An advantage to the employer is that they can offer one plan that employees can then customize no matter where they are located as opposed to constantly having to adapt their benefit plans to new products being introduced state by state throughout the program.

Most important, employees benefit by being able to easily purchase LTCI, vetted by their trusted employer, which will be there for them when they or their families need it the most.

Brian Harrington serves in a dual role as leader of Genworth’s Group Long Term Care insurance business and distribution leader for Genworth’s U.S. Life Insurance division.