With the cost of long-term care continuing to rise, it is a vital conversation to have with your clients. Many financial advisors are reluctant to have that conversation because they think it makes their clients uncomfortable. In many cases, when they try, they are met with resistance by clients who have preconceived notions about long-term care, including:
- They do not think it will ever happen to them
- They have sufficient assets to cover the need
- The government pays for it
- They have family members able to be their caregivers should the need arise
For many people, these four myths hold little basis. It becomes the responsibility of the financial advisor to educate their clients and dispel these myths. This means the advisor should consider not leading with the risk of needing long-term care insurance—because most people do not think they are at risk of needing it. Instead, advisors could change the conversation to the consequences of not having long-term care protection in place, especially as it relates to their financial security and their family’s physical and emotional health and well-being.
Changing the Conversation from Risks to Consequences
By focusing on the risks of needing care and immediately presenting the long-term care product as a solution, some advisors may ignore the seriousness of the consequences of needing care. Advisors should consider turning the focus to the people in their lives who will have no option but to put their lives on hold to take care of them when they become chronically ill. Have them think about what it could do to the portfolio they have earmarked to fund their commitments to their family.
Engage Clients by Asking Thought-Provoking Questions
Most of you know that the most effective way to engage your clients is by asking them questions. Asking the right questions moves clients to think about the issue in ways they have never done. A conclusion they formulate as their own allows you, their trusted advisor, to create solutions based on the client’s desires. The long-term care conversation is not that different from the life insurance or income protection conversations.
It starts by discovering what is important to your clients and why. You then guide the discussion to your client’s children and their relationships with them: “Do you want your family to care FOR you, or ABOUT you? Follow that up with: “How would it make you feel if you could not keep the commitments you have made in life?”
Be the Financial Advisor They Expect You to Be
Having engaged them up to this point, as a financial advisor, you are in the best position to tell them what they need to know, “It’s possible this will never happen to you. But, if it did, do you clearly understand how the consequences could severely disrupt your plan for financial security and your commitments to your family?
The bottom line is the long-term care conversation cannot be a product discussion. It needs to be a planning discussion in which you become a collaborator in helping them mitigate the severe consequences to allow the family to oversee care, not provide it. That is how they protect the family and enable them to keep their financial commitments.
The next step is to tell them you are taking all you have learned from them today and will come back with solutions that will get the planning process started. LTC (Long Term Care) insurance may be a part of that coordinated plan. Let FAIU (First American Insurance Underwriters) become your consultant for all areas of the next steps and position you as a hero with the ideal solution.
By: Ed Stone, LTC, DI & Annuity Specialist