Earlier this year, Lincoln Financial introduced MoneyGuard II, which represented a major change to the product feature set, including the ROP provisions, underwriting classes and available discounts.
While much of the early chatter on the new product focused on these changes versus the prior version, there was not much analysis of its competitive position versus the other players in this market.
That was a problem, as forward-looking sales are seldom, if ever, based on what was available in the past. Clients almost never know that there was a change to the product.
All they know is how well today’s offering addresses their specific needs or pain points, assuming the producer is effective. It’s the producer who is overly focused on what was, versus what is.
is MoneyGuard II still the industry-leading product the previous version was?
The only way to answer that is to delve into the subtleties of each of the players, and see how they stack up. Lincoln Financial has done much of the heavy lifting for us, releasing a series of two page comparisons of MoneyGuard II versus the competition.
They are very detailed and likely a bit much for most producers.
With that in mind, we pulled the most intuitive, salient points from those comparisons and compiled a one-page summary. Think of this as the “light” version of the Asset Based LTC Products spreadsheet from Cavalier Associates.
So what does the chart mean, bottom line?
Lifetime ROP options are still out there, including on MoneyGuard II.
ROP is becoming an elective option, allowing clients to trade the strength of the ROP for additional benefits or a reduced premium. While I would agree that having 100% ROP included in the base contract is ideal, the economics of these contracts really don’t support it at this point, and this trend is likely to continue.
MoneyGuard II has a base ROP of 80% in all years, and clients can elect the “vested” version, a 100% ROP beginning in year 6 and continuing for the life of the contract.
International Benefits –
This is another area that requires clients to make some choices. Options here range from no coverage at all to restricted monthly maximums and smaller benefit pools depending on the contract.
Client lifestyle is likely to be a major driver here, and globetrotting clients should certainly pay attention. If they do, they will see that while MoneyGuard II does reduce benefits if receiving care overseas, they do not require a stay in a facility, and the monthly benefit maximum remains the same.
Best in class in our view, as the competition either offers no coverage at all, or places much more stringent limitations on benefits.
Premium Payment Options –
This area is actually benefiting from the current economic environment, as the addition of flexible premium options make this type of solution more accessible for more clients.
If a producer wants to sell “one asset-based product” having premium flexibility is essential, and MoneyGuard II continues to offer the most diverse premium payment options.
Underwriting looms larger than ever. Clients and producers alike want to avoid intrusive medical exams, but they also want the best pricing they can find.
Knowing the discounts that are available and how they work is critical. The fact that MoneyGuard II treats Smokers and Nonsmokers alike is an obvious advantage, delivering premiums that can be as much as 35% lower than competing products. Of course, that MoneyGuard II utilizes a simplified underwriting process separates it from a number of the “pretenders” in this space.
Based on these four elements alone, MoneyGuard II still offers the greatest value to the client, and there are more key differentiators in the chart. When you combine that with the fact that they once again had a dominant market share in 2013, it is clear Lincoln Financial’s MoneyGuard II is still the product all the others are chasing.