WishLists

Illustrations - WishList

  • Adjustable Life Examples - Minnesota Mutual, Bankers Life, Principal Life
  • Deposit Term / Deposit Whole Life
  • Executive Life Insurance Company Illustrations
    • Metzenbaum
      • We've seen the problems that have occurred when Senator Howard Metzenbaum (D--OH) was given an illustration with a vanishing premium, and he had absolutely no idea that he had bought a policy that was not paid up in four years.
        • 1995 - SOA - Practical Illustrations and Nonforfeiture Values, Society of Actuaries - 14p
  • Life Insurance with a Side Fund - Military
  • Vanishing Premium Illustration Examples - Prudential, Metlife, etc.
  • 2009 Spring issue - New Appleman on Insurance: Current Critical Issues in Insurance Law - AIG’s Financial Distress: How Credit Default Swaps and the Lack of Regulation Brought Down an Insurance Giant and Implications for the Insurance Industry, Paul Walker-Bright and Timothy P. Law - 38p - <WishList>

What do we have?

  • In some ways, it is an industry victory; nonguaranteed elements are still allowed in illustrations.
    • I recall that at one point they were really talking about eliminating all nonguaranteed elements from illustrations.
  • I am on this panel principally as Chairman of the ACLI Subcommittee on Cost Comparisons.
  • Much of our work has dealt with the issue of illustrating Nonguaranteed Elements.
  • As a backdrop, I want to quote from a January 1988 Financial Planning article.
    • The article is entitled "Future Shock" by Harry Lew with the sub-heading:
      • "What will happen when a generation of insurance buyers begins comparing unrealistic illustrations with the actual performance of their policies?
      • Industry leaders would prefer not to find out."
  • The article goes on to say that "... veterans of the insurance industry are quietly expressing concern about the way illustrations are being used in today's market."
  • Often the numbers on the computer printout contain nonguaranteed projections on how the policy will perform in future years and tend to convince the client he is getting a better deal than he really is.
  • Some have gone so far as to call even well-designed illustrations the industry's "great lie."
  • Agents who continue to give much credence to nonguaranteed projections may be setting themselves up for a fall as policies fail to live up to the expectations of a whole generation of insurance customers.

-- Larry R. Robinson (ACLI)

1988 - SOA - Actuarial Opinion on Non-Guaranteed Elements, Society of Actuaries - 12p

<WishList> - Government Hearing that references this Michael McRaith quote

  • (p152) - Cliff STEARNS - (R-FL).
    • Now, recently Michael McRaith, who is director of the National Association of Insurance Commissioners, told the Senate Banking Committee, he said, you know, if AIG had gone in bankruptcy, we would have taken care of it.
    • It would have been an orderly disposition.
      • This is what he said: ‘‘AIG’s insurance operations and their other companies would have simply—we would have simply bought up AIG’s insurance assets, allowing a seamless delivery of AIG’s insurance obligations.’’

2010 0127 - GOV (House) - The Federal Bailout AIG - [PDF-652p]

CRS

  • 1999 0513 - CRS - Insurance Provisions of Financial Services Modernization Bills in the 106th Congress: Antecedent Supreme Court Decisions (Rs20132 / 1999-05-13) (RS20132 / 1999-05-13)
  • 2005 - CRS - The Current Insurance Broker Investigations: An Overview, RS21966, Baird Webel  -  6p - [link]
  • 2005 - CRS - Courts Narrow McCarran-Ferguson Antitrust Exemption for “Business of Insurance,” RS22118, Janice E. Rubin - 6p 

GOVERNMENT (FEDERAL)