Alan Richards

  • EF Hutton
  • Life Insurance Company of California 
  • 1983 0510, 0511 and 0728 - GOV (House) - Tax Treatment of Life Insurance, Pete Stark (D-CA)  ---  [BonkNote]
  • (p11) - Alan Richards:  Maybe I can make a very brief comment here. There may be some misunderstanding as to the intent of the SEC-sponsored legislation on front-end loads.
    • The front-end load in the strict sense relates only to a contractual plan.
      • The plan is purchased for a fixed period, perhaps ten or fifteen years, and as much as 50 per cent of the first year's payment goes into load.
      • This is the thing that the SEC is really seeking to outlaw. 

1967 - SOA - New-Company Problems, Society of Actuaries - 38p

  • In fact, it is accurate to describe Universal Life as a generalized version of the actuarial formulas underlying traditional life insurance products.
  • In other words, it is possible to produce any traditional plan of insurance from the generalized formulas underlying universal life.  p448

--  Alan Richards, president and chief executive officer of E. F. Hutton Life Insurance Co.

1983 0510, 0511 and 0728 - GOV (House) - Tax Treatment of Life Insurance, Pete Stark (D-CA)  ---  [BonkNote]

  • Alan RICHARDS.
    • My name is Alan Richards, president and chief executive officer of E. F. Hutton Life Insurance Co., headquartered in La Jolla, California.
      • It is a wholly owned subsidiary of the securities brokerage firm of E. F. Hutton of New York.
      • I, too, have submitted written testimony which I would appreciate being entered into the record.
    • Hutton Life is the originator of the universal life product which we first introduced in 1978.
      • It now accounts for somewhere between 15 and 20 percent of the total life insurance market in this country.
    • I am here to describe universal life and to explain why its development was inevitable, and why it is so consumer oriented.  (p448)

1983 0510, 0511 and 0728 - GOV (House) - Tax Treatment of Life Insurance, Pete Stark (D-CA)  ---  [BonkNote]

  • I am going to talk about Question B, regarding the sale of life insurance in combination with mutual funds.
    • This discussion is from the standpoint of an organization consisting of a management company--Insurance and Securities Incorporated that manages a large, established mutual fund--Insurance Securities Trust Fund--that in turn is invested almost entirely in the stocks of life insurance companies and fire and casualty insurance companies. This is one of the few organizations having its own full-time sales force and selling its own fund directly to the public.
    • Life Insurance Company of California was formed in 1963 as a wholly owned subsidiary of the management company and has achieved considerable success through the dual licensing of nearly all the men in the existing fund sales force to sell both funds and life insurance.
      • Our experience has been that a moderate proportion, perhaps 20 per cent, of these investment-oriented men will sell life insurance in significant quantities, another 20 per cent will have nothing whatsoever to do with it, and the remainder will sell life insurance only intermittently.
      • Nevertheless, this sales force has shown great stability, with very low turnover rates, and the result has been life insurance sales each year on the order of $100,000,000.
    • As might be expected, the bulk of the business has been term insurance, particularly decreasing term.
      • However, this was mitigated somewhat by our sales strategy, which was to feature a combination plan consisting of whole life and decreasing-term insurance to age 65.
      • Without this product our proportion of term insurance would have been much higher than the 70 per cent actually experienced.

--  Alan Richards, Life Insurance Company of California

1967 - SOA - New-Company Problems, Society of Actuaries - 38p