The Easy Business Most Insurance Agents Are Leaving on the Table

By Jeff Sams and John Hockaday

Low-hanging fruit for agents

A lot of us only sell Med Supps. They’re what we know, they’re comfortable, and our clients already want it.

It’s the easy sell.

But what if we told you that you could be saving your client from financial devastation while also doubling your sales? There’s a huge opportunity for easy business that a lot of us have been ignoring.

Jeff Sams, CEO & Principal, and John Hockaday, COO & Principal, together unravel how we all (themselves included!) have dropped the ball with extended care coverage, and they’ll also uncover the astounding potential of recovery care.

 

Then vs. Now

John Hockaday

John: Twenty years ago — and Jeff would agree with me on this — it was all about the long-term care and Med Supps. That’s all we wrote. And we weren’t alone.

There were a lot of guys like Jeff and I. If you were in the Med Supp business, you wrote long-term care and Med Supps hand-in-hand.

However, we haven’t been selling it for a long, long time. Agents just don’t talk about long-term care anymore, because:

  1. It’s more expensive,
  2. Insurance companies don’t want the business (they want the 50-year old), and
  3. There’s not a lot of players in it anymore.

And yet, you’ve got a field force (people my age) that wrote a ton of it 20 years ago. It’s how we lived — how we made our money.

Jeff Sams

Jeff: Yes, long-term care used to be a growing market.

There was no doubt there was a need for it.

Guys don’t write it, because they don’t want the problems.

  1. Underwriting became an issue, and
  2. Most insurance carriers were rejecting around 50% of the business.

So here the agent is writing it, and half of the time, it wouldn’t get issued.

Then, the customer would get mad. A person might be healthy, but then they get turned down. The carriers got so picky that if you weren’t ready for the Olympics, they weren't going to take you.

The agent is now thinking:

“I’m not going to ruin my Med Supp sale. I’m not going to ruin my relationships by even offering it when I know that half the time, they aren’t going to get issued.”

We all just got burned so many times. On top of it all, insurance carriers started giving huge rate increases. That’s why there’s a bad flavor in the mouth about this.

John Hockaday

John: That’s exactly why there’s a huge opportunity for a resurgence with recovery care.

These short-term policies have everything an agent could want:

  1. They look like a Med Supp app,
  2. They’re easy to write, and
  3. Companies want people in their 70s and 80s to get it.

Short-term care is the new long-term care in the Med Supp world.

 

The Sales Strategy

Jeff Sams

Jeff: Part of my sales strategy is what I call “Take It Away.”

Here’s an example:

“So, unfortunately, Mrs. Jones, insurance companies are in this to make money. They only take 50-60% of the people who apply. I think you should apply, but I can’t guarantee you can get it.”

You have to soft sell it, because you don’t want your client to get mad.

John Hockaday

John: Long-term care is just hard to sell to our senior market these days, because the insurance companies don’t want them.

That’s where this recovery care fits in. It’s a senior-aged product — we can write an 80 year old.

It’s really a Med Supp app. Your Med Supp customers are probably going to qualify. You’re not going to be stranded at an age where they’re considered too old.

If I were going to package something with a Med Supp — a final expense, a cancer, or a short-term — my No. 1 would be a short-term (if I were buying it personally). I think it’s more important.

The one thing that’s the most important to the consumer is that recovery care.

Jeff Sams

Jeff: Our industry has become not so much sales, but instead price driven. Since ‘92 when the Med Supps were standardized, you’ve been selling against price. Before, that was not the case.

We need to get the sales strategy back — we need to educate our clients on why they really need it rather than how much the price is. You have to let them know how fast 30 days goes by when you’re shelling out $8,000 per month for extended care.

Here’s the bottom line:

John and I are amped up about this because both of our fathers have lived this. We have all this information, we know it and believe it, but all of us — John, myself, and a ton of other agents — kind of walked away from selling it.

But this hits home for us now.

 

The Commission

Jeff Sams

Jeff: The commission shouldn’t be the first reason you get into this, but that is pretty convincing as well.

John Hockaday

John: The renewal is guaranteed, and the commission is much higher than Med Supp. You just can’t go wrong with presenting this product.

If you just started offering this to your existing Med Supp customers, it’d be amazing how much of it you’d write.

 

Next Steps

Jeff Sams

Jeff: John and I are going to do a roleplay video.

You’ll see exactly

  • what we say,
  • how we say it, and
  • how we lead the person to see how important this is.

If you have one year of extended care needs, you’re out close to $120,000. That’s significant.

John Hockaday

John: None of us are selling this. Maybe 1-2% of our sales are recovery care. When we quit writing this stuff, stop cross-selling, and just forget about it, we’re leaving a ton of business on the table.

We’re going to help you get your pitch down. Take advantage of our free Marketing Kit below, and Jeff and I will send you training videos in the days following.

A Quick Training Guide: How to Sell Short-Term Care Insurance with Confidence

Free STC Marketing Kit

The need for extended care is real — we’ve just lived it — and we want to spark that same fire in all of our agents. We’ve found an attractive alternative to long-term care insurance that you’ll prefer and that your clients can get excited about.

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