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Wednesday, April 17, 2013

Consider Hybrid Life Insurance/Long-Term Care

By Anthony DeGregorio, Zenith Marketing

For years, bank clients have taken advantage of the security they find in placing their “rainy day” funds in CD's and savings accounts. These tried-and-true vehicles allow funds to be accessed in a relatively short period of time, and provide different levels of return. Clients may occasionally wonder, "What's next?"

These conversations present the perfect opportunity to introduce a hybrid life insurance/long-term care (LTC) product to your clients. These products take advantage of a simplified application/underwriting process, and provide both solid LTC coverage and a competitive death benefit in one convenient package, all while leveraging the purchasing power of the client. Some contracts even a 100% guaranteed return of premium feature – at any time, the client can receive their entire initial deposit back, for any reason!

Why should our bank look at a hybrid product like this?

There are a number of hybrid life insurance/long-term care products on the market, offering a different selection of features and options. Here are some points to take into account when considering these types of products:
  • Return of Premium: Most hybrid products offer a feature that enables customers to receive their entire initial deposit back at any time, minus any interest that has been accrued on the contract. This instant liquidity is one of the most compelling features of these type of contracts.
  • Simplified or “Streamlined” Issue: Many hybrid products are designed on a simplfied issue chassis - with usually less than a dozen pre-screening questions and a short phone interview, most qualified clients are immediately approved – no exams, labs, or doctor’s statements.
  • The odds are NOT in your favor: About 70% of people over the age of 65 will require LTC services at some point in their life. Hybrid life/LTC products provide a valuable buffer to protect a client’s assets and retirement portfolio, especially when compared to self-insuring against LTC costs.

ABIA members can learn more about how to identify and work with clients on hybrid life insurance/long-term care products by reading the full post.*

* Having troubles accessing this members-only document? Contact Deanne Mariño for help.