What's exciting or promising about the LTC category in 2011?
In 2010, the Individual LTC industry experienced sales growth for the first time in several years. Although that growth may be due in part to improving economic conditions, our hope is that Baby Boomers are beginning to recognize the importance of LTC insurance in planning for long-term care costs as they gain more personal experience with providing or coordinating that care for family members.
What's driving the rising sales?
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As the results of our 2010 Cost of Care Survey indicate, those who know someone who has needed long-term care are significantly more concerned about needing long term care in the future than those who have not had this experience. At Prudential we have several exciting initiatives rolling out in 2011 – our innovative, simple but comprehensive LTC Evolution product will be available in more states, and we're about to introduce a new electronic application that will make the entire sales process quicker and easier for producers and clients.
How has the recent focus on health care policy affected the outlook for long-term care insurance?
In the short term, there really are very few implications for LTC insurance arising from the Patient Protection and Affordable Care Act (PPACA). In a few years however, one part of that legislation, called the CLASS Act, will introduce a voluntary national LTC insurance program. This new program may cause employers to better educate their employees about the importance of long-term care planning. We feel that increased exposure to and discussion of the – risk posed by potentially catastrophic long-term care costs may have a positive impact on the private LTC insurance industry.
What can advisors do to help shrink the wide disconnect between the number of people who believe long-term care coverage is important, and the number who actually purchase it?
That's something all of us – advisors, insurers, and the public – have to address. We believe that products like LTC Evolution, that are more affordable and easier to explain, sell and understand – and yet still provide comprehensive LTC coverage – are part of the solution.
What's the top item on your agenda that you hope to accomplish for 2011? It might be a bit of a boring answer, but given the industry consolidation that is currently taking place, my top priority is managing Prudential's LTC business in a responsible, profitable manner. We want more people to purchase our LTC insurance products to solve their problems, but we also need to manage the business in a way that will also ensure Prudential's long-term viability in the Individual and Group LTC insurance markets.
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