Simplicity Agent Training

Form #S502-305 For Agent Use Only

Simplicity Agent Training


Question: Are you selling the new kind of LTCi or the old

kind?


•Count on MedAmerica.•Highest rated coverage (91 by SellingLTC.com)•Rightsizing coverage to fit client needs.•Get a Lock on Affiliations and small businesses!

Here are 4 powerful points to use:

Introducing…

from MedAmericaYou’ll be a STAR with your customers when you deliverthe Highest Quality Coverage at Affordable Premium Ratesfrom a company committed exclusively to LTC since 1987


Count on MedAmerica

• Strong ratings – rated A- by Standard & Poor’s since 1997 & A.M. Best since 1994.

• 18 years dedicated exclusively to LTC.• Owned by $4.5B not-for-profit health care

company putting policyholders ahead of shareholders.

• No rate increases – EVER!• Over $100M in claims paid.


In-force Policies

8,77811,560

30,057

37,46841,250 42,586

53,235

61,038

85,36090,476

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 1/1/2005

Th

ousa

nds


Earned Premium

$10,527$14,920

$26,847

$33,761

$44,028$47,840

$53,715

$65,635

$86,455

$99,639

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000$70,000

$80,000

$90,000

$100,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Th

ousa

nds


Profit(before FAS 133)

$342 $535

$2,031$2,406

$3,103

$3,725

$4,538

$5,336

$7,032

$8,046

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Th

ousa

nds


$15 $20$42

$56

$107

$145$174

$214

$286

$358

$511

$595

$0

$100

$200

$300

$400

$500

$600

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Growth in Assets (000’s)

Th

ousa

nds


10%14%

20%26%

32%40%

47%55%

5% 7%11%

19%23%

30% 34%43%

0%

10%

20%

30%

40%

50%

60%

0 1 2 3 4 5 6 7 8+

Actual

Actual vs. Expected Claims

% o

f P

rem

ium

Expected

Duration by Year


Key Product Features

Highest Rated Coverage


Key Features

• Simplicity is designed to be tax qualified. 2 out of 6 ADL’s and cognitive benefit triggers apply.

• Cash Benefit pre-paid each month.– No submission of third-party bills for

reimbursement required. No restrictions or limits apply.

• One policy with riders to enhance or simplify coverage (facility or community only)

• No limitations or exclusions.


What if There Was a Policy…?

• Without – defined lists of providers• Without – defined lists of types of

service• Without – restrictions OR limitation on

what, when, where or who uses or provides the service

And what if it was paid in CA$H – in advance?


Coverage Made Easy

OTHER PRODUCTS “talk about confusing…”

• Providers as listed Any Service in the contract and approved

by the insurer. Anywhere• Type of services listed in the contract and approved by the From Anyone insurer


Product Overview


Core Benefits

For illustrative purposes only, availability of benefits, options, riders and discounts may vary by state.

Age Limitations: 18-85 (lifetime benefits not available under age 50)

Monthly Benefits: $2,100 and up in $300 increments. $12,000 cap for 7 year duration and under. $9,000 cap for unlimited duration.

Calendar Day EP: 30, 60, 90 or 180

Lifetime Max: 24, 36, 48, 60, 84 or Unlimited Months

Worldwide Coverage: No limitations or benefit reductions.


Riders

Nonforfeiture Riders:Shortened Benefit PeriodReturn of PremiumFull Return of Premium

Restoration of Benefits:Joint BenefitsShared Care RiderShared WaiverSurvivor Benefit

Flexible Payment Options:Paid in Full at Age 65Reduced Premium (Age 65 or Age 70)10 Years Paid in Full

Inflation Protection:5% Simple No Max5% Compound 2X Max5% Compound No MaxNone


Shared Care Rider -

•Allows spouse with identical benefits to tap into benefits of other spouse

•Upon death, remaining benefits are passed to surviving spouse with no additional premium cost.

•Complements “rightsizing” strategy with shorter benefit durations, i.e. 5/5 = 8/2


Rightsizing Coverage

Rightsized coverage. It’s the RIGHT THING TO DO.


How much HHC coverage is enough?

Industry Facts: 85% of LTCi policyholders received

reimbursement of $75 or less Average Monthly Claim: $1,527-

$1,661 HHC claimants receive on average

36 hours of formal HHC per week. Family members provide 23 hours of care (unpaid per week).


Turning the Sale Around

Consider asking your client to base their monthly cash benefit on how much they will need to live in the community in their own home.

That’s called the “community benefit”.

If at some point, they need care in a facility, their monthly cash payment will increase to a “facility benefit”.



Facility Care

Last Care Option

Usage flat over last 13 years

First Choice of ClientUsage increased by 400% over

last 13 years

Home Care



Home Care

First Choice of ClientCover Based on Need

Cash paid regardless of Services

Last Care Option Choice for Client

Cash paid at 120% of Home Care

Facility Care


What’s the Right Size for Duration?

Industry Facts: Only 15% of claims exceed 24 months.

Of those, only 7% exceed 36 months. 97% of claims are less than 60 months

in duration


RIGHT SIZE with Simplicity

• Rightsized Durations: 3, 4, or 5 years.• Statistics say that your customer is better off with

a higher monthly benefit for a shorter duration than a lower monthly benefit for a lifetime duration.

• Compared to lifetime benefits:5 year = 38% lower premium4 year = 46% lower premium3 year = 55% lower premium


RIGHT SIZE with Simplicity

Inflation OptionsYour customer needs inflation protection, and we offer 5% simple and 5% compound (2x max) as affordable options to the traditional 5% compound.

Compared to 5% Compound

5% simple = 41% lower premium

5% compound (2 x max) = 54% lower premium


Rate ComparisonAge 50 Couple

(Old) Traditional Reimbursement

• Unlimited

• Compound/no max

• Home Care (monthly reimbursement max $4,800)

Annual Premium

($2,722 x 2 = $5,444)

(Facility benefit $4,800)

(New) Simplicity Cash

• 5 year (60 months)

• Compound 2x

• Home Care (monthly pre-paid benefit) $4,800

• Shared Care

Annual Premium

($1,043 x 2 = $2,086)

Premium Savings = -$3,358

(Facility benefit $6,000)


Get a lock on Affiliations & Small Businesses

Multi-life Programs:• Affiliation: 10% discount• Employer: 10% discount and

simplified underwriting for employees when 10 or more qualify for coverage.


Simplicity is Unique

• Simple, flexible, tax qualified plan with competitive premiums

• Prepaid Cash Benefits

• Worldwide Coverage

• No limitations or exclusions

• Multi-life programs

• Pay by credit card


Simplicity Target Markets

• Ages 40-65• Healthy couples (married or care partners)

40% discount• Affiliations – up to 53% discount• Employer Programs – 4 question

Simplified Underwriting• Executive Carve Outs• 10 pay plans – C Corporations


Closing

• Great Company

• Great Product

• Why wouldn’t you sell Simplicity from MedAmerica?

Documents

Simplicity Agent Training