When a person witnesses a family member pass away, it is natural for that person to reflect on their own mortality.
After the thought about how long that person has left to live, it is plausible and reasonable that the person in question would begin to think about what he or she is leaving behind, which would prompt thoughts of life insurance.
Depending on the circumstances of the family member’s passing, that event might also cause an investor to consider purchasing long-term care insurance as well.
Spectrem’s new study on end-of-life preparations and decisions examines the level of insurance ownership among affluent and wealthy investors who have been involved, to one degree or another, with the financial matters related to the death of a family member, as well as among those investors who are working with a family member preparing for their eventual passing.
Among all of those investors, Down To The Last Detail determined that 43 percent of all investors have purchased life insurance beyond that provided by the investor’s employer. That includes 4 percent of all investors who purchased additional life insurance after their involvement with the financial matters of a relative who has passed away or is preparing for the day he or she passes.
Your clients should have an idea of how much insurance they want to own when it comes time to have insurance accounts cashed in. If there is an interest among your clients to add to their insurance totals, it is obviously cost-effective to make those purchases as soon as possible.
Which is why it is interesting to see that, according to the Spectrem study, 15 percent of investors claim to have plans to purchase additional life insurance in the future. Waiting adds to the cost of insurance and would seem to be the kind of decision that would be easily accomplished, taking that concern off the mind of your client.
Life insurance will be paid out eventually. Long-term care insurance, however, is a hedge bet against exorbitant medical costs for a person who requires years of extensive medical treatment or care. Due to the high cost of medical treatment in the U.S., long-term care insurance is very expensive, and many investors do not own it because they are unsure whether they will ever use it.
Twenty-five percent of all investors own long-term care insurance, and that includes the 3 percent who decide to purchase the product after witnessing their family member’s own struggles with late-in-life medical bills. Again, almost the same percent (24 percent) said they planned to buy long-term care insurance in the future.
©2019 Spectrem Group
Keywords: insurance, long-term care, investors, advisors, Spectrem, last detail, witness