some insurers providing long-term
care products are questionable.
Her clients’ willingness to follow
her advice about buying long-term
care insurance varies, Govern says.
“It depends on what they have seen
their own parents go through,” she
Govern recalls one client in particular who struggled with the decision.
“I don’t know if this is appropriate to
ask,” Govern remembers him saying
before asking if she had long-term
The advisor, who is 50, says she
told her client “not yet” because she
still pays life insurance and long-term disability premiums, but added
that she expects to replace those
payments with ones for long-term
When clients reach age
advisors should help them
revie W options for
long-term care insurance.
been placed in a room with four
other women, who all shared one
bathroom. The facility’s lack of
attention to cleanliness was startling, Pence says.
One nurse cared for 19 patients,
Pence recalls, adding that her mother
was not receiving the attention she
needed to recover from her surgery.
Within 48 hours, Pence arranged
needing long-term care.
Some advisors who recommend long-term care insurance for their
clients do not have it themselves.
care insurance as she approaches
her late 50s.
CHANGE IN POLICY
Laila Marshall-Pence, a registered
principal at Pence Wealth Management in Newport Beach, Calif., used
to put herself in the camp of financial planners who discourage clients
from seeking long-term care insurance. For many years, “I never recommended it,” recalls Pence, who
has $800 million in assets under
But two years ago, an episode
close to home prompted Pence to
revisit the issue. Doctors recommended that Pence’s mother stay
temporarily in a private nursing
home after surgery to recover.
When Pence visited the long-term care facility to visit her mother,
she was appalled. Her mom had
to have private nurses attend to her
mother 24 hours a day. This expensive proposition caused her to realize that, for her own daughter’s sake,
she needed to structure some kind
of insurance that would cover such
care for herself and her husband if
the need ever arose.
LIfE INsurANCE OPtION
But rather than opting for a standard
long-term care insurance policy,
Pence purchased a life insurance policy with an accelerated-benefits rider
that promises to pay out all or part of
the death benefit if the policyholder
needs it for long-term care.
Pence says such policies do not
have the use it or lose it feature of
other long-term care insurance. Under
life insurance policies with such rid-
ers, heirs receive the full payout if the
covered individual dies without ever
and said, ‘Laila, if he hadn’t died, I
was going to die. The caregiving was
going to kill me. I really felt like I was
praying for him to die.’”
tHE PrICE IsN’t rIGHt
Others are not convinced that advisors should widely recommend long-term care insurance. For instance,
planner Thomas W. Lawson of T. W.
Lawson Financial in Ann Arbor,
Mich., rarely recommends it for his
clients — most of whom, he says,
hold significant assets. Lawson, who
declined to disclose his solo practice’s assets under management,
says he doesn’t have long-term care
insurance himself, either.
“It’s overpriced,” he says, “and has
limitations.” He notes that, in some
instances, expenses related to long-term care are not even covered.
Lawson will go through analyses