medamerica simplicity ii presentation rev 4-13.ppt · the simplicity improvements simplicity...

Introducing

T i Si l S llTwice as Simple to Sell

S2-6046 For Agent Use Only

AgendaMedAmerica Company Review

Product ConceptProduct Detailsoduc e a s

The Simplicity AdvantageMulti Life

Company Review

• 20 Years Insurer of LTC

• Not a Financial Services Supermarket

• Integral business of The Lifetime Healthcare

Company - $5 billion health insurer w/ over 65

Years Experience

• No History of Rate Increases

• 50 Years Combined Actuarial Experience +50 Years Combined Actuarial Experience

• Millimam & Robertson Consulting from Inception

Company Review

Consistent Ratings

• 10 consecutive years MedAmerica yhas an A.M. Best’s rating of A-“Excellent” and an A- “Strong” grating by S&P

Company Review

I ti I d t L d

1996 i S C

Innovative Industry Leader

• 1996 First to Introduce Shared Care

• 2004 First to Respond to the NEWCConsumer:– True Cash

– Simplified Contract Language

– Pre-paid Benefits

R l t P d t N d i th F t– Relevant Product Now and in the Future

– 100% WorldWide Coverage

“We’re in this business to take care of people, not to hide behind the

fine print.”p

Chris Perna, president

Company Summary

Leading the EvolutionLeading the Evolution

• Commitment to LTC Market• Commitment to LTC Market

• Time-Tested Fiscal Strength

• 65 Yrs Experience & Strength of Parent Corporation

• Actuarial Management Continuity

• Global Reinsurer PartnerGlobal Reinsurer Partner

The Simplicity Concept

T t B b BTarget: Baby Boomers

h C k• The New LTC Market• 79 Million, Educated, Planning for Retirement, , g• Desire to be Independent• Cash for Lifestyle Assurance should “Life

Change on a Dime”

The Simplicity Concept

Why Cash?

• Provides Maximum Flexibility for Funding Care • “Care Choice” not “Managed Care”

B t O ti f th F t• Best Option for the Future• Pre-Paid Monthly Cash Benefit • No Proof of Service or Receipts!

Si l A k F Ch k!• Simply Ask For a Check!

The Simplicity Concept

Why Cash?Why Cash?

• “All Wheel Drive” for the changing terrain of LTC – Guaranteed Benefits

• Covers New Treatments, Technology for Prolonging IndependenceProlonging Independence

Simplicity Stands Tall among the Competition

Highest Rated Product 91

• Prudential Cash 78

• Allianz Generation Protector 65

• MetLife Ideal 2 73

• John Hancock Leading Edge 59

• Custom Care Two 66• Custom Care Two 66

The Improved Simplicity

INTRODUCING

Quality & Value

Why Simplicityii

• True Consumer Value• Enables a Simpler Sales Process• Bring back “Lost” Producers• Bring back Lost Producers• Attract “New” Producers/Entities

Sell Value

Why Simplicityii

True Consumer Value• Cash = Maximum Flexibility• 100% Benefits Paid – Guaranteed!!100% Benefits Paid Guaranteed!!• CareDirections Family Advice & Advocacy

PProgramsm

Here Comes Simplicityii

• When: First Introduction Date : April 2, 2007• Where: AK, AL, CO, CT, IA, ID, MI, ND, OK, SC, SD,

WY and DC/DC TRUST → NJ• Second Introduction Date: May 1, 2007• Where:AZ KY LA ME NE NH NM NY OH PA• Where:AZ, KY, LA, ME, NE, NH, NM, NY,OH, PA• Simplicityi cease sale 60 days after state rolls out

Si li i iiSimplicityii

The New Simplicity

Cash Benefit Account

• Cash Benefit Account (face amount).$100,000, $200,000, $300,000,

$500 000 & $1 million$500,000 & $1 million.

• Easy to Explain

• Builds with Inflation Option

• No Durations, No Complicated Formula!

What the Customer Wants

Monthly Cash BenefitTh h ill b id i i l• The amount that will be paid in a single month.

• Pre-Paid no proof required• Pre-Paid, no proof required

• Specific Monthly Cash Benefit options for each Cash Benefit Account chosen at the each Cash Benefit Account chosen at thetime of application.

• Use for HHC or FC• “Rightsized” based on industry experience

The Simplicity Monthly CASH Benefit Options

“Buying LTC insurance isn’t as complicated

and mind-boggling as I thought! It’s so easy to make a decision and know whateasy to make a decision and know what coverage I’ll have! My premium

represents d l ”good value.”

The Simplicity Improvements

Simplicity Simplicityii

Duration

Lif ti2, 3, 4, 5, 7, L

Cash Benefit Account$100K, 200K, 300K, 500K, 1M

Simplicity Simplicity

Payment Lifetime10 Pay

Pd up @ 65Reduced @ 65

Lifetime10 Pay

Pd up @ 65Reduced @ 65Reduced @ 70

Pd up @ 65

HHC Options 60%, 80%, 100% Home Health Care Benefit plus optional enhanced Facility Care

Inflation None5% Si l

None5% Simple

MMB $12K Community or Facility

$12K Monthly Cash Benefit (HC/FC)$16K Enhanced Facility Benefit

5% Simple5% Compound - 2X Max5% Compound - No Max

5% Simple5% Compound - 2X Max5% Compound - No Max3% Compound - No Max

The Simplicity Improvements

Simplicity Simplicityii

Value Added Programs~ Care Scout~ Script Save

Not Included Included Script Save

Exclusions

Subrogation Clause

None Act of war

Not Included Included

Simplified Application

Not Available Available to age

71 for $100K and $200K plans

APS & FTF RequiredDiscounts

R t Cl

> age 75 > age 72Cap No Cap

3 2Rate Classes

Employer Program

3 2

Spouses are fully underwritten

Actively at work Spouses have “Simplified Underwriting”

Turn The Sale Around

Enhanced Facility Benefit

• Option increases Monthly Cash Benefit f F ilit Cfor Facility Care

• 33% increase in benefit for 10% i ipremium increase

• Available on all Cash Benefit Accounts

NEW Underwriting Enhancement

New Rate Classes

• Preferred – 10% Discount

• Standard

• Previous Class Three Conditions• Previous Class Three Conditions are Now Considered Under Standard ClassStandard Class

The Simplicity Improvements (NO CAP)

DiscountsCare Partner Discount:

• 20% Savings if One Purchases20% Savings if One Purchases

• 40% Savings if Both Purchase and are AcceptedAccepted

PLUS

• 10% Preferred Health Discount

PLUS

• 10% Affiliation or Employer Program Discount

The Simplicity Improvements (New Option)

Inflation OptionsInflation Options

• None• None

• 5% Simple

• 5% Compound 2X Max

• 5% Compound No Max

• 3% Compound No Max(Partnership Ready)( p y)

NEW SOFTWARE TOOL

NEW!MedAmerica’s National CostMedAmerica s National Cost

Survey on Home Care

Provides The Agent with the Basis for “Right-Sized” Benefit

Design

Sell to the Buyer’s Desire

M dA i ’MedAmerica’s National HHC Cost Data

• Conducted by CareScout exclusively y yfor MedAmerica

• A Major Software EnhancementA Major Software Enhancement

• Turn the Sale Around and approach clients with what they desireclients with what they desire –REMAIN at HOME

Providing the Agent with New Tools

Cost of Care Study• 1,800 home health care providers were surveyed

across 79 geographic regions of the U Sacross 79 geographic regions of the U.S.• Data collected on:

– Hourly, private pay rates charged by licensed agencies y, p p y g y gfor home health aide. Data on homemaker services was also collected (only private pay rates were used, no Medicare or Medicaid rates were used.)ed ca e o ed ca d ates we e used.)

• Minimum, maximum and average hourly rates studied

Providing the Agent with New Tools

“Cost of Care” Key FindingsCost of Care Key Findings• Findings consistent with other studies

including LifePlans analysis of formal and informal care giving in the community.

• National average for a Home Health Aide was $19.07 (50% above or below)

• “People using non-medical home care services use between 22 & 44 hours of h k” ($22 $44K l)home care per week” ($22-$44K annual)

The Simplicity Advantage

• Guaranteed Cash - “All Wheel Drive” for the changing terrain of LTC service delivery.

• Pay for Emerging Technology

• Any Service Covered even if provided by

by Spouse or Non-Licensed Provider

• 100% Worldwide Benefits

• Agent is not put in the Position to Explain• Agent is not put in the Position to Explain

Why Expenses are not Covered

The Simplicity Advantage

Individualized Care S i d S tServices and Support

“Care choice ” not “managed care”• Care choice, not managed care

• CareDirections Family Advice &

Advocacy ProgramSM – CareScout,

ScriptSave

• Personal Care Advisors -

Independent care plan and supportIndependent care plan and support

The Simplicity Advantage

How to Design Simplicity ii

For Maximum Value

Simplicity ii Value Design # 1Client Type Married Couple age 60, good health, concerned about care theyyp p g g y

may need in the future, however cost is a factor. May retire outsidethe US.

Typical Agent $100 per day, 7 yr. duration, Compound Inflation Protection, 90yp gRequest

$ p y, y , p ,day elimination, Standard rate class, life pay, Monthly Indemnityand calendar day riders added

New $300 000 Initial Cash Benefit Amount (CBA)NewSimplicity iiTranslation

$300,000 Initial Cash Benefit Amount (CBA)$3000 Monthly Benefit Amount (MBA), Compound 5% 2X maxinflation, Shared Care Rider

Simplicity ii Design Traditional ReimbursementValue of Benefitat age 60

$300,000 $255,000at age 60At Age 75 $600,000 $531,440

Premium $1921.00 each $2174.00 eachPremium $1921.00 each $2174.00 each(Value)

Simplicity ii Value Design # 2

C i A 0 C l i d i h 401k iClient Type Age 50 Couple interested in ways they can protect 401k savingsshould one get sick before their retirement plan is complete.

Typical Agent $150 per day 100% Home Care 5 yr duration 5% CompoundTypical AgentRequest

$150 per day, 100% Home Care, 5 yr duration, 5% CompoundInflation Protection, 90 day elimination, Standard rate class, lifepay

New $500,000 Initial Cash Benefit Amount (CBA)Simplicity iiTranslation

$4500 Monthly Benefit Amount (MBA), 5% Inflation 2x Max,100% Home Care

Simplicity ii Design Traditional ReimbursementSimplicity ii Design Traditional ReimbursementValue of Benefitat age 50

$500,000 $270,000

At Age 65 $1 000 000 $561 120At Age 65 $1,000,000 $561,120

At Age 77 $1,000,000 1,007,760

Premium $1316.00 $1597.00Premium $1316.00 $1597.00CC2

Simplicity ii Value Design # 3

C i M Willi d hi if b h 55 h l iClient Type Mr. Williams and his wife both age 55 have personal experienceswith parents needing long term care.Family has a history ofAlzheimers. They both worry about getting sick and would want tobe in their own home as long as possiblebe in their own home as long as possible.

Typical AgentRequest

$200 per day/ $6000/month, lifetime duration,100% Home Care,5% compound inflation, Monthly Option and Calendar day riders,90 d li i i S d d l lif90 day elimination, Standard rate class, life pay

NewSimplicity ii

$1,000,000 Initial Cash Benefit Amount (CBA)$6000 Monthly Benefit Amount (MBA) Compound 5% 2x Max

Translation Inflation, Shared Care Rider

Simplicity ii Design Traditional ReimbursementValue of Benefitat age 55

1 Million Lifetime

W/ Shared Care RiderPremium $2835 $3906

CC2

Simplicity ii Value Design # 4Client Type Bob and Sue are young working adults age 45. They justyp y g g g y j

discovered a gap in their medical coverage offered at work.Realizing that their health can change on a dime, they have askedtheir agent for affordable solution to their concerns.

Typical AgentRequest

$100 per day,5 years, Compound 5% & 3% Inflation Protection,90 day elimination, Standard rate class, life pay

New $200 000 Initial Cash Benefit Amount (CBA)NewSimplicity iiTranslation

$200,000 Initial Cash Benefit Amount (CBA)$3000 Monthly Benefit Amount (MBA) = (66 Months) Compound3% Inflation, Speed Application

Simplicity ii Design Traditional ReimbursementValue of Benefit

t 45$200,000 $182,500

at age 45At Age 79 $546,381 $500,000Premium withoutshared care

$734.00 each $756.00 eachshared carePremium withshared care rider

$876.00 each $832.00 each

CC2

Simplicity ii VALUE Good Things to Know

Home Care Only Vs. Comprehensive Age 55 = 17% Savingsg g Age 65 = 18% Savings

Enhanced Facility OptionEnhanced Facility Option

10 % Increase in premium

Shared Care Rider$200,000 $300,000 $500,000 1million, , ,

+21 % +17 % +7 % +4 %

Simplicity ii VALUE Good Things to Know

Inflation ProtectionAges 5% Compound

No Max5% 2 X Max 3% No Max 5% Simple

50 1.00 .44 .54 .63

55 1 00 .52 58 6355 1.00 .52 .58 .63

60 1.00 .62 .62 .70

65 1 00 73 67 7665 1.00 .73 .67 .76

70 1.00 .83 .72 .82

Join the National Growth in EP Sales

Employer Program

• Simplified Underwriting: During open enrollment

• Actively-at-work employeesActively at work employees• Actively-at-work spouses (30+hours/week)• Age 71 or younger• Age 71 or younger• Website enrollment – a MedAmerica 1st

Join the National Growth in EP Sales

Employer ProgramEmployer Program

• Special Care Partner rates, plus 10% discountMi i ti i ti 10 EE’• Minimum participation: 10 EE’s pass 4 questions

• Best World-wide Coverage (100%)

Why Sell #1 LTC Product

Twice as Simple to Sell• Everybody Understands & Needs CASH!

• New Face Amount ConceptNew Face Amount Concept

• Targeted to Baby Boomers - Relevant Today

• MedAmerica’s National HHC Cost Data – NEW!

• Speed App – 4 Questions! NEW!

• Partnership Ready NEW!

• Robust Multi-Life Program - Enchanced

Employer Program

Tools to Sell #1 LTC Product

Simplicity ii Launch Kit

T i Si l S llTwice as Simple to Sell