One of the principal mistakes made to date in the marketing of long term care insurance has been to ...
One of the principal mistakes made to date in the marketing of long term care insurance has been to treat potential customers as one large homogenous group. Much of the sales literature depicts smiling retired people while many of the words play on the negative aspects of a potential future need for LTC
In reality there is not just one group of potential purchasers, but a whole series of people at different stages of life, with different aspirations for the future, different views of risk and with differing abilities to pay
This may well be one of the reasons why the market is still far too small (about 30,000 policies in force) and why the average age at purchase has remained at about 67 since the first policies were sold at the start of the 1990s
There is, however, one IFA that has specialised in repackaging the long-term care message and made many sales to younger people
We must learn from this example and become much smarter in the way we market these products. The primary market will be those aged over 50 for this type of cover. There are various identifiable cohorts in this section of the population
l Those born prior to the mid-1920s who grew up after the First World War and fought during the Second World War. Survivors of this group are already are now over age 70 and are relatively poor. They believe in the Welfare State and were sold the concept of 'cradle to grave' healthcare. Widows are predominant in this group
l Those born between then and 1946 whose lives were affected by the war and the sacrifices of the post-war period. This group of people contains those either coming up to retirement or those more recently retired. They are generally much better off in retirement than their parents were, with a large proportion being property owners
l Those born in the years after the war, now known as the baby boomers. The majority will be retiring during the next decade and will form the wealthiest group of retirees to date
When marketing to the various cohorts of mature customers there are a number of universal characteristics that must be kept in mind. They will be much better judges of value for money than many younger customers
Price is not the only component of value and they will look carefully at the services and benefits being offered
One of the primary driving forces as people get older is a desire to stay independent both financially and physically. Mature customers need to be able to make choices themselves rather than having things 'spoon fed' to them
There is a lot of wisdom and experience stored up in the human mind as it ages. All too often we treat older people as though they are not able to think for themselves. It is important that we show respect for the knowledge that they possess and make use of it in our marketing and sales processes
