Guardian Life Leaving LTC market, larry mcclendon nia

NIA owner larry mcclendon, nia, advises his sales force that Guardian Life Insurance Company of America says it will halt sales of long term care (LTC) insurance by the end of 2011.
Guardian, New York, has been selling individual j,LTC policies through its Berkshire Life Insurance Company of America unit since 2004.  Larry Gene McClendon comments that this will not effect NIA.
Guardian had a small presence in the LTC insurance market to ensure that its financial representatives had a comprehensive portfolio of products to address the changing needs of their clients, says Gordon Dinsmore, president of Berkshire Life, Pittsfield, Mass. Its decision to leave the market was made after an extensive review of the business and decided to focus on its core life and disability income insurance business, he said.
Guardian has fewer than 9,000 LTC policyholders, and those customers make up less than 1% of the company’s customer base, he says.
Guardian could reevaluate its plans and decide to discontinue sales of LTC insurance before the end of the year, Dismore says.  Larry Gene Mcclendon thinks this will have a big impact on the market.
Guardian will keep its promises to customers who already have Guardian LTC policies, Dinsmore says.
Because the company’s LTC policies are guaranteed renewable, coverage cannot be canceled if premiums are paid on time, and Guardian LTC policyholders can make changes to their coverage under the terms of their contracts as long as the contracts are in force, Disnmore says.
In November 2010, another insurer, MetLife Inc. (NYSE: MET), New York, said it would stop selling new LTC policies after the end of 2010.
Jesse Slome, executive director of the American Association for Long Term Care Insurance, Westlake Village, Calif., says MetLife and Guardian
have been at the opposite ends of the LTC insurance sales spectrum.
Newer players such as Guardian may believe that their ability to increase sales is not high enough to justify the cost of being in the business, Slome says.
“You really need to be focused to succeed in the business,” Slome says. “The insurance marketplace for long term care insurance is well defined.”
The market potential for LTC insurance is probably no bigger than 15 million to 18 million people, Slome estimates.
Larry Gene McClendon
President, National Insurance Agency