Last week,I shared a few claims statistics for both LTC as a whole and OneAmerica Care Solution. As you would expect, most claims occur over the age of 75 with more the 50% of them starting between the ages of 80 and 89.
In our December Coffee Break webcast focusing on claims, we share more data with you – if you haven’t viewed it, please take a few minutes to check it out.
Here is a little something that I found weird when I reviewed claims data. Acdording to the American Association of Long Term Care Insurance (AALTCI), 73% of new long term care claims begin at home. (Note: more on these numbers, go to the American Association for Long Term Care Insurance website at aaltci.org.) This is makes sense to me.
What I find odd is that the OneAmerica Care Solutions claims experience is not consistent with that experience. At OneAmerica, 32% of claims begin at home. According to OneAmerica experience, 47% of claims were initiated once assisted living commenced.
This strikes me as odd.
Why would there be a gap between what LTC industry experiences and what OneAmerica has?
My gut tells me this – people are either they are waiting for the need for long term care services to reach a point where facility-based care is required or unaware of the benefits available to them.
In either case, I believe that policies are not being utilized to their maximum effectiveness because policyholders and their families are unaware of what they can do to assist. Seriously, it’s that simple – clients and their families do not know.
That is why a conversation between those parties (policyholder/insured and their family or whomever will handle their affairs when they are either ill or have passed on) is imperative. It is imperative!
A good friend of mine lost his father a year ago after a long battle with multiple illnesses. They received home health services for well over 2 years and were paying for that care out of pocket. The cost was pretty hefty (close to $400,000). When his dad passed, he left instructions for his son to ask me to assist him in the insurance portion of his final arrangements.
While wading through his policies, I came across a long term care policy that he had purchased decades earlier. It was a rich one with 5% compound inflation and unlimited benefits. And, it was in-force when he passed. Long story made short, we filed a claim for the care that his father received and ultimately received a check to cover the cost of the home healthcare services that he received.
The moral of this story is simply this … clients NEED to share their plans along with instructions of how they want things executed when something happens and they need someone to assist them.
(And, retain the receipts for any care that is received.)
OneAmerica offers several tools to help with the long term care claims experience. One is the Step by Step Guide to a Long Term Care Claim. This is a great piece to use with clients whether they are starting their planning or after they have a policy in place. It is full of great information and can be helpful for their family (or whomever will manage their affairs) when an extended care situation occurs.
The other is the OneAmerica Claims Concierge service. When a claim is imminent or has commenced, the Claims Concierge will help the family (or whomever is designated to manage their affairs) navigate the claim.
The tools are there – people need to be aware that they exist. And, that comes down to one thing – communication during the planning process, throughout their lives, and when a situation arises.
It is the end of the year and I’ve been asking you to review your book of business and identify your clients who are over 75 and own annuities that are on the sideline and earmarked for an emergency. This is a big thing – it can be a possibly make a difference in funding an extended care event while preserving assets.
That is what the million dollar annuity strategy is all about. The transformation of tax-deferred money into tax-free distributions for long term care. Learn more about it at https://fridayswithfisher.com/million-dollar-annuity/.
My “big ask” of you for the million dollar annuity strategy is to identify 3 or 4 annuity owners 75 or older who might be viable candidates for our leverage strategy then give us a call.
Fridays with Fisher 
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