Part II: A primer on the aging brain - five strategies for communicating with prospects
While the future is unknown for clients, statistics on the potential of developing dementia as they age point to the need to take long-term care planning seriously and before symptoms of cognitive impairment appear. It's not an easy conversation to have with clients. It's also apparent that some normal changes do occur in how the brain works and how older people process information.
Here are five strategies for advisors as they discuss possible long-term care needs.
1. Consider adjusting your communication style with clients over age 50.
As discussed above, the brain changes with age. Even if they are fully capable of understanding financial concepts, it may take older clients longer to absorb facts and figures and to calculate costs. A better approach might be to engage in big picture thinking, work at an appropriate pace, and involve the client in the big picture and in thinking through the need for long-term care protection.
2. Be balanced when discussing cognitive impairment—it's not inevitable but the odds increase with age.
Some financial professionals believe that the statistics on long-term care—how many people will need it and how much a nursing home stay will cost—speak for themselves and focus on them in a sales discussion. But people are already uncomfortable with a long-term care discussion and are scared enough about developing dementia. Perhaps a better approach is to provide a balanced view. Half of the older population may not need it but as with any insurance product, purchasing a long-term care rider hedges their bets on their future.
3. Help clients understand that long-term care planning will help them receive the care they need if they can't make decisions for themselves.
Often financial advisors focus primarily on the cost of care and the value long-term care protection provides in preserving the estate. But it may be worth a deeper dive into what actually happens if a client develops dementia and can no longer make decisions. A question to ask is if they have thought about what would happen if they needed extended care—how they would like it delivered (i.e., at home or in a care facility), how much care their family is capable of providing and what type of paid care would be needed to supplement what the family can do.
4. Empower clients to do advance planning and make decisions now in case they do develop Alzheimer's disease.
Though the long-term care discussion may be difficult, the fear of developing dementia in the future is real and can be a trigger in getting clients to plan ahead. They will recognize that once symptoms of cognitive decline are evident, it will be too late to get long-term care coverage. And it is easier to talk about the possibility of developing Alzheimer’s disease when a client is healthy and has begun the process of retirement planning.
5. Be familiar with company protocols if you suspect that a client has dementia.
If a client appears to be confused beyond what might be considered within normal brain aging and shows some apparent symptoms of dementia, it might be best not to carry out a transaction. This is a judgment call, but from an ethical and legal perspective, it may be the right decision. When dealing with clients over age 50, be well versed on what the company protocol is and what steps should be taken.
The Long-Term Care ServicesSM Rider (LTCSR) comes at an additional cost and does have restrictions and limitations. A client may qualify for the life insurance but not the rider and vice versa. The LTCSR is paid as an acceleration of the death benefit.
Life insurance products are issued by Equitable Life Insurance Company (NY, NY) or Equitable Financial Life Insurance Company of America (EFLOA), an Arizona stock corporation and are co-distributed by affiliates Equitable Network, LLC (Equitable Network Insurance Agency of California in CA; Equitable Network Insurance Agency of Utah in UT; Equitable Network of Puerto Rico, Inc. in PR), and Equitable Distributors, LLC. Variable products are co-distributed by Equitable Advisors, LLC (Member FINRA, SIPC) (Equitable Financial Advisors in MI and TN) and Equitable Distributors, LLC. When sold by New York based (i.e. domiciled) Equitable Advisors financial professionals life insurance is issued by Equitable Financial Life Insurance Company (NY, NY).
Life insurance contains exclusions, limitations, and terms for keeping it in force. For costs and complete details, contact a Financial Professional.
Equitable and its affiliates are not affiliated with Dr. Sandra Timmermann.