What are your impressions abouth this combo Life Insurance LTC product?
It would be great to get some feedback on this new product. I believe the future of LTC insurance is in a combined product with life insurance. LTC has the potential of bankrupting states and the combined product will increase the incentive for its use. Have any of you sold products like this? What has your experience been with LTC?
My experience with LTC is that the people who need it right now, baby boomers, don't want to talk about it. Just like everything else in their lives, many of them don't see the value in something that they don't get to use for a long time. That makes them hesitant to get it or even talk about it. It's usually not until someone has to take care of mom and dad or see a grandparent die with absolutely nothing that it clicks with them.
I agree with you that this hybrid LTC/Insurance product is the wave of the future. I've used Moneyguard before, and it's similar to the Genworth product. I like it. It takes the argument of them paying for, but not using the insurance off the table. They can't stomach spending money on something they might not use. It's doesn't bother them with their car or homeowners insurance because those are typically mandated so they're forced to get it whether they use it or not.
TLC requires a initial lump sum premium of at least 25,000. LTC insurance( max is usually 4x or more the initial premium). Death benefit(around 2x initial premium). And the option of getting your initial cash out after the first year. Moneyguard is similar, but I'm not sure if you can get your initial premium back. It's not available in all states. Some more feedback from FA's experienced with these and other LTC products would be nice. By combining LTC with Life insurance it certainly gives the impression of greater value to the customer.
How I understood Moneyguard was that you can always get your initial premium back at any time.
Moneyguard has a lifetime money back guarantee. Genworth's money back guarantee is only for 15 years.
Other differences: Genworth credits your account 3.5% a year. Moneyguard is 4% minimum. Genworth has a Priviledge Care Coordinator program. I don't believe Moneyguard does.
Big difference: I just ran a quote on my dad, 65, non-smoker, standard risk class. 6 years of coverage, $100K initial premium, no inflation. Here's what my quote system spit out:
Monthly Benefit Total LTC Benefit Death Benefit
Moneyguard $4226 $304,296 $101,432
TLC $6755 $486,405 $162,135
So, it looks like TLC has an advantage over Moneyguard on the benefits, but not the money back guarantee or interest rate. Something doesn't really add up in the math, though. You'd think thaf if Moneyguard pays 4% and TLC pays 3.5%, then Moneyguard should come out ahead. It's just a quick quote though. Maybe I'd get a different result if I called my wholesalers and did a formal hypo.
I think they're both good products to discuss with clients who might be sitting on CDs right now with the thought of using that money for LTC eventually. 3.5% or 4% looks a whole lot better right now than 1% on a 1 year CD.
TLC guarantees 3.5%, but is currently paying 4.5%, thus the difference in results. I believe that after 15 years, the surrender value is higher than the cash back guarantee. Moneyguard isn't available in all states, so for some of us, TLC is our only option. Both look pretty good. I've had great service from other Lincoln product partners.
Great thanks for the info. If any of you have used the products can you say anything for the difficulty in the process?
I had someone who got turned down for moneyguard get approved for the GNW product.