State Farm LTC Info?

[yankee466]

Hoping someone can share any pro's and con's of State Farm's LTC offering. I was shown a quote on a plan from them that was impossible to beat on an unlimited benefit plan for a 57 year old potential client of mine here in Georgia. I know their product is not very configurable, but I did not know the rates could be that good. Genworth's Classic Select and Assurity came closest....but neither has the AM Best rating that this lady is insisting on.

Of course Clark Howard includes State Farm on his recommended list of LTC carriers because of their financial rating....even though hardly anyone ever buys their LTC policies.

Any help on details appreciated, as I have never seen a sample SF policy.

 

[Benefits Man]

Sounds to me like Sf is buying business and might have a huge liability when claim time comes. I assume you tried Met/JH?

 

[Mr_Ed]

Sounds to me like Sf is buying business and might have a huge liability when claim time comes. I assume you tried Met/JH?

Isn't it possible that SF is the best choice for this woman?

 

[yankee466]

Sounds to me like Sf is buying business and might have a huge liability when claim time comes. I assume you tried Met/JH?

Met and JH were expensive compared to SF in this example. Was hoping someone had seen the language in a SF policy.

 

[CALTCAgent]

Hello,

I think State Farm pays daily, not monthly for home health care. I looked at their brochure a while back and I think that was the only option for home care.

Thanks

 

[bluemarlin08]

LTC is a contract that shouldn't be bought on price, compare policy benefits, GE and Hancock win hands down.

 

[Mr_Ed]

LTC is a contract that shouldn't be bought on price, compare policy benefits, GE and Hancock win hands down.

yankee,
i just ran the numbers.
if she can get preferred, Genworth is about 5% lower than SF.
if she can only get standard, then Gen is about 10% more SF.

if the SF quote is low, it's because they are showing her 5% simple or NO inflation benefit.

most of the time when I've seen sf quotes, they have had no inflation benefit.

do you use stratecision?
the sf rates are in stratecision.

sao
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LTC is a contract that shouldn't be bought on price, compare policy benefits, GE and Hancock win hands down.

no offense, bluemarlin, but this line "LTC is a contract that shouldn't be bought on price" is just pure baloney.

The policies are more alike than they are different. In fact, it's rare that there are any significant differences other than underwriting and premium.

 

[yankee466]

yankee,
i just ran the numbers.
if she can get preferred, Genworth is about 5% lower than SF.
if she can only get standard, then Gen is about 10% more SF.

if the SF quote is low, it's because they are showing her 5% simple or NO inflation benefit.

most of the time when I've seen sf quotes, they have had no inflation benefit.

do you use stratecision?
the sf rates are in stratecision.

sao
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Yes...I use Stratecision. SF comes out a little cheaper when I run it....so not sure what you looked at.. (assuming you are buying on price). 57..preferred...Georgia.....$125/day...5% simple...90 day elim....unlimited......daily benefit....SF = $185/2173. Same combo with GNW Classic Select......= $197/2190. SF also comes with restoration of benefits built in, GNW does not....so on paper, SF is a winner. Both are service day elimination.

I am not saying at this point whether this is a good plan for her or not....but I was just trying to do my homework on SF ahead of time, since if I can not sell it, I have to assume it is not my recommendation for a plan. Since it is not even a partnership eligible combination, I will certainly tout a plan with 3% compound if I have to over the 5% simple. That could knock SF out, since SF would have to go to 5% compound to be partnership for her age. Also, if I drop back down to 10 years instead of lifetime, other plans look better than SF. Seems like SF knows no one uses if more that 10 years and charges basically nothing extra over the 10.

So...you can say do not buy on price, but for the money (without knowing the contract language), SF looks good for that particular combination of benefits until I find a reason that it does not(except for them not being a top 10 LTC carrier)

So...back to the orginal premise...anyone know of any internal language with SF that could be a problem. Likely it is a decent plan that will probably get its rates jacked up in the future if they decide to stay in this business.

Thanks for all the comments so far....glad to see everyone else works on the weekend too.

 

[Mr_Ed]

yankee

I was assuming you were doing 5% compound.
If sf is quoting 5% simple, then the policy doesn't even qualify for the Georgia LTC Partnership. I know it's not critical to have a PQP when choosing a lifetime/unlimited Benefit Period. But, at least if she goes with Gen with 3C, she has the option, in the future, to ratchet down her BP (to 10 or 8 or 6) and still have the partnership asset protection to fall back on.

I think there should be some additional security in choosing a long term care insurer that pays over a billion dollars in LTCi claims each year. There's some value in that, imho.

When you originally posted this, I'd assumed that there was a 20% or more difference in premium. For $10 per month, it's a no-brainer.

 

[yankee466]

yankee

I was assuming you were doing 5% compound.
If sf is quoting 5% simple, then the policy doesn't even qualify for the Georgia LTC Partnership. I know it's not critical to have a PQP when choosing a lifetime/unlimited Benefit Period. But, at least if she goes with Gen with 3C, she has the option, in the future, to ratchet down her BP (to 10 or 8 or 6) and still have the partnership asset protection to fall back on.

I think there should be some additional security in choosing a long term care insurer that pays over a billion dollars in LTCi claims each year. There's some value in that, imho.

When you originally posted this, I'd assumed that there was a 20% or more difference in premium. For $10 per month, it's a no-brainer.

Understand and agree....the bigger $ differences were when I used Hancock or Prudential or Mutual of Omaha, or Metlife or others that gave her the comfort level of A+ or better .....as so far (haven't even met with her yet) she seems more hung up on ratings because if Clark Howard says it, it must be true. Lemmings?

I am sure you have run into people who are concerned over GNW comdex scores despite the $1B in claims paying.