Why would you recommend that clients with millions of dollars in invested assets spend money on a long-term care plan? Because it helps remove the risk from their portfolio.
With affluent clients, it’s not whether they can afford to pay for potential long-term care needs. But is it an expense they want to incur at an unpredictable time in their lives?
Long-term care concerns are similar no matter your clients’ net worth.
- They may equate long-term care with a stay in nursing homes. In fact, 76 percent of long-term care insurance claims begin with home care or in assisted living facilities.¹
- Another factor to consider is that long-term care is just that – long-term. About one-third (34 percent) of LTC insurance claims last at least two years and 13 percent last more than five.²
- Active baby boomers may expect to remain healthy throughout retirement, but Americans turning 65 face a nearly 70-percent chance of needing long-term care services in their lifetime.²
Sources: ¹ American Association for Long-Term Care Insurance; ² U.S. Health and Human Services Department
Self-Insuring Is Self-Funding
High net worth clients don’t have the affordability objection. But their mindset may be “If the time comes, we’ll pay for it ourselves.” That perspective could have an adverse effect on their portfolios if and when they do need long-term care.
Ask your clients if they believe another downturn in the market could happen. There’s also the likelihood that they could experience an unexpected health event. There’s simply no guarantee that their need for care would come at a time that’s either convenient to them or to the performance of their portfolio.
It may make sense to concentrate on insuring affluent clients’ investments with product solutions that can minimize their risk of absorbing the entire cost of care.