Use Linked Benefits To Build Your Sales Arsenal

Most agents are familiar with linked benefits. However, Life Marketers deals with lots of agents and we often find that linked benefits are not brought up as an option when selling life or LTC policies. Have you presented linked benefits to your clients in lieu of traditional long term care? If not, you are missing an opportunity to protect your client on multiple levels in the event they live or die.

Long term care insurance sales often face an uphill battle with clients. Younger participants, for whom LTC is affordable, aren’t yet seriously concerned with long term illness nor do they understand the financial implications. Older clients, who are usually the most interested in LTC, have sticker shock when they get a quote. These factors can make a LTC sale difficult. Yet, as insurance professionals we often see the destruction that a long term illness can wreak upon a client’s financial health. Long term care insurance was created to mitigate this risk but, if clients are unwilling to purchase how can we help them? The answer may be with Linked Benefits policies.

Linked benefit products have evolved since first introduced to the market with products like Lincoln Moneyguard. Moneyguard was attractive for high net worth clients but was unattainable for most. Now, multiple companies offer policies with linked benefit options. At the risk of sounding too elementary, linked benefits provide a death benefit on long term care policies or, when using a life insurance chassis, provide long term care benefits drawn from the death benefits. The result is that clients can get additional coverage at no out of pocket cost.

Today, we have 2 types of linked benefit policies you can present to your clients. The first option uses a long term care chassis and adds a life insurance benefit to the policy. The second option uses a life insurance chassis, usually a universal life policy, and allows the insured to draw down on their death benefit to cover the costs of long term illness. Like traditional LTC, the client must medically qualify for the benefits by being unable to perform 2 of the 6 ADL’s. Either option can be excellent alternatives to traditional long term care. For more specifics, please contact us.

Why linked benefit vs traditional long term care?

There are several reasons to add linked benefits to your sales arsenal. Below are a few of the highlights:

1. These products have a few distinct advantages over traditional long term care, one of which there is a benefit upon the death of an insured. Traditional long term care provides no life insurance benefit. Like many insurances, it’s use it or lose it!
2. The linked benefit plans provide an indemnity benefit which can make paying the bills easier. Traditionally, only 16% of insured need clinical care. The remaining 84% have expenses for which it is difficult to submit bills for payment. However, linked benefits often are paid with a cash benefit so there is more flexibility to cover expenses.
3. Linked benefit policies using a LTC chassis provide a residual life insurance benefit to the client if they exhaust all their chronic illness benefits.
4. When using a life chassis clients only pay for the linked benefit chronic illness rider if they use it, even then it is paid for out of the benefit, not out of pocket. And if they never use it, it’s free!

There are lots of available linked benefit policies. Ameritas, Lincoln, Minnesota Life, North American, Penn Mutual, and many others offer policies that fall under the linked benefit description. The wide variety of choices means a wealth of policies to fit individual client goals. Life Marketers can help you identify the best policies for clients so you can add this valuable policy option to your sales toolkit. Should you have clients today that are looking for innovative, cost effective solutions to their needs let’s talk!

If you need assistance on linked benefits, long term care, or life insurance, drop us a note and we’ll do whatever we can to help. Contact Us.
 

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