Premiums, Costs, Values and Benefits – Agents

  • (p40-41) – Q: Could you describe for the jury what you were trying to convey when you drew this drawing, Exhibit 774, on the back of her illustration. – <WishList – Exhibit 774>
  • A: Jeffrey Stemler, Agent:  This is — when we are sitting down talking about insurance, we try to explain to the prospects exactly how the insurance works.
    • So this is part of our talk that we give to explain how it works.
      • So this would be a build slide.
      • This didn’t just start there.
    • I drew a line on the bottom and I said:  When you buy insurance, there is a minimum amount that you must pay for insurance to pay for the costs and put the policy in force.
      • And I drew the line and I wrote minimum, and I would ask who do you think sets that price.
        • Some people will say: I don’t know.
        • Others: Well, the insurance company.
        • I go, yes, you’re correct.
      • And I said: They have actuaries, and the actuaries, their job is to figure out how much they need to collect for any given amount based on the age of the person so that they can cover the risk and also still make a profit.
    • I said: But there’s another line that we need to be  concerned about, and then I draw the line up on top and I put the max there.
      • And I say this is the maximum you can pay for a contract.
        • I said: Do you know who sets that limit?
        • People will often say: Well, the insurance company; right?
        • And I say: No. It’s actually the government.
    • In the example we’ll often say: Well, let’s just assume that this is $500,000 that we are dealing with here and the minimum premium is a thousand dollars and the maximum premium is $5,000.
      • Why would anyone put $5,000 into a contract if you could buy the same amount of coverage for only 1,000?  

2015 – LC – Walker vs Life Insurance Company of the Southwest – TRIAL DAY 11 – Case 2:10-cv-09198-JVS-JDE Document 820 Filed 12/01/15 Page 40 of 279 Page ID # 33532  —  [BonkNote]

Q: How Do Agents Use Life Insurance Illustrations?

  • How do Agents use these?
    • It would be good to hear from agents.

—  Richard Wicka, WI-Chair)

2018 12 – NAIC – Life Insurance Illustrations Issues Working Group

2017 – State Farm Agent Training / Van Mueller

Approximately 2:11 – “I don’t ever use an illustration.” 

See the rest at Youtube – Van Mueller | State Farm Agent Training Feb 2017 (Complete)

 

 

  • She also said that, except from some whole life insurance and term life insurance products, the summaries are explained to the consumer by an agent or broker and really serve as a tool for financial advisors in highlighting the features of a product.

— Ms. Stegall (WI)

2016 0817 – NAIC (LIIIWG) Life Insurance Illustrations Working Group –  Conference Call 

NALU – National Association of Life Underwriters, cka NAIFA

  • I sincerely believe we have a flawed instrument in today’s sales illustrations.
  • …we did not communicate the impact of change as well as …we should have.
  • Our biggest mistake would be to delay.
  • ⇒  I don’t believe the consumer will tolerate or forgive us, let alone the regulators, if we do nothing.

—  Robert Nelson, chairperson of the National Association of Life Underwriters (NALU) Task Force on Illustrations – (Currently NAIFA)

1993 – SOA – Sales Illustrations – We Can’t Life With Them, But We Can’t Live Without Them!, Society of Actuaries – 28p

  • 1994-3, NAIC Proceedings
    • Mr. Nelson [NALU/ NAIFA] stated that, in his opinion, consumers can not differentiate between illustrations that show what is possible and improvements that are probably not possible.
  • 1955 – AP – The Origins of the National Association of Life Underwriters. Business History Review, Proschansky, H, 29(3), 238-262 – <WishList>
  • 1994-1, NAIC Proceedings –  NALU /NAIFA Statement – Illustrations – 18p
  • 1996 0930 – National Underwriter, Life & Health/Financial Services Edition – NALU Takes Position On ‘Total Cost Disclosure’ – 2p – <WishList>
    • [Bonk: Found in – 1997 – JIR / NAIC – An Analysis of Life Insurance Illustrations: Regulatory Implications of the Disparity between Policy Yields Based on Illustrated Versus Actual Surrender Values, by James M. Carson and Mark D. Forster – 23p
  • Carney Smith, of the National Association of Life Underwriters, called for more consumer ‘information’ from companies and stronger self-policing within the insurance industry. (NALU)

1973-1, NAIC Proceedings

  • Second, an adequate flow of long-term capital is a critical need of a free society.
  • Indeed, many of the problems this country is experiencing at the present time are reportedly due to the fact that we don’t have an adequate flow of long-term capital.
  • Whole life for over 100 years has been a major factor making it possible for the insurance industry to provide that long-term capital to this country.
  • That a Government agency at this critical point in time should espouse and recommend to the American people that this time-proven vehicle for the creation of long-term capital which served those same people so well should be abandoned in favor of term insurance is hard to believe.  (p79)

— Thomas J. Wolff – [NALU/ NAIFA] National Association of Life Underwriters

1979 0710 and 1017 – GOV (Senate) – FTC Study of Life Insurance Cost Disclosure, Senator Howard Cannon (D-NV)   —  [BonkNote]  —   [PDF-592p]

  • Moss Committee Report of 1978
    • The findings and conclusions, and this is the part that created the explosion, were that there is a shortfall of information, particularly with respect to ordinary life and that consumer experience does suggest that the consumer is not able to adequately determine the suitability of the product, the quality of the product, or the cost of the product.
  • As a consequence, consumers are sustaining losses, and this would be a definite indication of a market failure.

—  Jack E. Bobo, Executive Vice President of the National Association of Life Underwriters (NALU)– NAIFA

1979 – SOA – Cost Disclosure (Moss Report), Society of Actuaries – 18p

  • 1978 0807, 0814 and 0815 – GOV (House) – Life Insurance Marketing and Cost Disclosure, Congressman Moss (D-CA) – [PDF-826p-govinfo.gov]
    • 1978 12 – GOV (House Report) – Life Insurance Marketing and Cost Disclosure Report Together with Dissenting Views, Congressman Moss (D-CA) – [PDF-106p]
  • I’d like to stress that agents don’t pretend to know the answers.
  • It is our intent to ask for your [actuaries] help because we’re currently living with problems that lack solutions.

— Robert Nelson, Chairperson of the National Association of Life Underwriters (NALU) Task Force on Illustrations

1993 – SOA – Sales Illustrations – We Can’t Life With Them, But We Can’t Live Without Them!, Society of Actuaries – 28p

  • Actually the demands for many of these new products come from the marketplace. (p338)

— Thomas Gregg, National Association of Life Underwriters. (NALU) 

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

  • William Albus (National Association of Life Underwriters) commented that the requirement for disclosing sales commissions is unnecessary because it is superfluous and would only confuse consumers.
  • He stated that the purpose  of disclosure is to provide information for making an informed decision and the disclosure of sales commissions has nothing to do with making this decision.

1988-2, NAIC Proc.

  • An agents’ association representative [Robert M. Nelson, NALU, NAIFA] reported that his group was concerned about problems because agents are generally the first to hear the disappointments, confusion and bitterness created by the unrealized expectations of policyholders.
    • Of paramount concern to agents is the fact that illustrations may not be supportable under current actuarial standards of practice.
  • He asked the group to concentrate on the serious problems caused when illustrations of non-guaranteed elements and dividends are not supportable for even a few years into the future and tend to overstate the amount of non-guaranteed elements and dividends likely to be paid.
  • The association recommended more precise definitions and stricter rules on supportability and current experience.
  • The association also asked the NAIC to take action to sensitize policyholders to the effect of a change in interest rates, and to mandate a signed disclosure statement where the consumer acknowledges he has read the illustration and understands it.

1993-1 – NAIC Proceedings

  • I sincerely believe we have a flawed instrument in today’s sales illustrations.
  • …we did not communicate the impact of change as well as …we should have.
  • Our biggest mistake would be to delay.
  • ⇒  I don’t believe the consumer will tolerate or forgive us, let alone the regulators, if we do nothing.

—  Robert Nelson, chairperson of the National Association of Life Underwriters (NALU) Task Force on Illustrations – (Currently NAIFA)

1993 – SOA – Sales Illustrations – We Can’t Life With Them, But We Can’t Live Without Them!, Society of Actuaries – 28p

  • Mr. Morgan also asked what percentage a field agent was allowed to use in an illustration and Mr. Nelson responded that it could not be larger than what was currently being paid, but in a declining market that may not be a valid projection of future results.  (p251)

1993-1, NAIC Proceedings

  • Mr. Morgan – Noel Morgan (Ohio)
  • Mr. Nelson – an insurance agent from Nebraska who is chair of the National Association of Life Underwriters Sales Illustrations Task Force
  • Mr. Albus said:
    • there was a need to illustrate non-guaranteed elements, but consumers must understand that they are not guaranteed.
    • He thought it was a good idea to tighten up the parameters of assumptions.
    • He said his group was working on the concept of a sensitivity index to allow consumers to see what would happen when assumptions changed to a small degree.

—  William Albus (National Association of Life Underwriters — NALU / NAIFA)

1993-3, NAIC Proceedings

Agent – Company

 

  • 2021 0809 – LC – Amicus Brief – PIABA – Public Investors Advocate Bar Association Williams v. National Western Life Insurance Co., Supreme Court Case No. S269978; Appellate Court Case No. C090436; Amicus Letter of the Public Investors Advocate Bar Association in Support of Petition for Review – 8p – 
  • 2022 0718 – Amicus – PIABA – Public Investors Advocate Bar Association – in Opposition to Request for Depublication of Williams v. Nat’l Western Life Ins. Co – 4p
  • 2021 0809 – Amicus Brief – PIABA – Public Investors Advocate Bar Association – 8p
    • The Williams decision raises two issues of critical importance to investors.
      • The first is whether insurance carriers may be held to be responsible for the acts of independent producers who transact business on behalf of multiple carriers.
      • The second is whether there is a private right of action under Cal. Insurance Code § 785, which imposes a duty of good faith and fair dealing upon insurers and insurance agents to prospective customers who are age 65 or older.
      • Our members have seen an explosion of cases in recent years in which independent insurance agents who market themselves as financial advisors and/or retirement planners recommend to prospective clients that they invest their retirement monies into costly and unsuitable insurance products which are not regulated as securities, including indexed annuities and indexed universal life insurance policies.
        • Insurance agents frequently recommend that prospective customers liquidate or exchange their existing IRA and/or 401(k) investments and use the proceeds to purchase indexed life insurance products.
  • 2022 0718 – Amicus – PIABA – Public Investors Advocate Bar Association – in Opposition to Request for Depublication of Williams v. Nat’l Western Life Ins. Co – 4p
    • Williams v. National Western Life Insurance Co., Case No. C090436, published 5/10/22 at 78 Cal. App.5th 500.
    • The Public Investors Advocate Bar Association (“PIABA”) submits this letter as amicus curiae in opposition to National Western Life Insurance Company’s (“NWL”) request for depublication of the opinion in the above-referenced matter, Williams v. National Western Life Insurance Co., Case No. C090436, published 5/10/22 at 78 Cal. App.5th 500. (“Williams Opinion”).
    • ⇒  In summary, the Williams Opinion makes the important clarification that life insurers are vicariously liable for the wrongdoing of their independent non-exclusive life insurance agents.
  • Another consideration is your field force.
    • How much control do they have over the business?
    • How loyal are they?
    • How much in-force business does each agent control?
  • The decision will be influenced by what impact your field force can have on you.
  • So even though the numbers can be generated to prove one set of assumptions, the assumed reaction of the field force must have an impact on your decision.
  • Commissions on internal relacements require two basic decisions:
    • do you want to encourage replacements;
    • and how much do you pay?
  • There are two possible items to pay commissions on:
    • the cash value rollover;
    • and the new premium.
  • A third question is whether or not you require the policyholder to roll available cash value into universal life in order to pay compensation.
  • You do not necessarily have to pay your agent a commission if he is going to take all your cash values and move them into his money market funds and start up new universal life plans.
  • My conclusion is that I would just as soon not have anyone touch my existing block of business.
  • Other companies have come to conclusions that they are better off replacing their existing blocks with universal life.
    • They claim that the profits are better by doing it.
  • In our case, it is a matter of determining the best approach to use without aggressively replacing our own business.

—  Gary P. Monnin, American Founders

1982 – SOA – Universal Life (rsa82v8n111), Society of Actuaries – 14p

Target Market

  • I have a comment which you can respond to if you wish.
    • Universal Life might well be a more appropriate product than Adjustable Life for the very sophisticated, very high premium, as you mentioned, product or sale.
    • However, I think that there is a major segment out there where Universal Life Just would not fit.
    • Universal Life seems to be taking a giant step forward.
    • Adjustable Life may be a reasonable middle ground which our agents and our potential policyholders can understand a little bit better than the Universal Life concept at the present time.

—  Spencer Koppel

1979 – SOA – Future Trends And Current Developments In Individual Life Products, Society of Actuaries, rsa79v5n44 – 24p 

  • The group first considered a suggestion from Chris Kite (FIPSCO) for a new type of index that would allow consumers to compare the assumptions in the illustration.
  • Brenda  Cude (Cooperative Extension  Service) opined  that  the  target  audience does not care about assumptions.

— Report of the Cost Indices Subgroup of the Life Disclosure (A) Working Group

1996-3V2, NAIC Proceedings – (p931)

  • Commissioner Hager of the Universal & Other Plans (A) Task Force stated that there appeared to be disclosure problems with universal life plans and that the identification of these items should be placed on the Actuarial Task Force agenda.
    • The members present agreed that the disclosure issues extended to variable life as well as universal life.
    • The main concern was that an unsophisticated buyer purchased a policy and did not know what the coverages, benefits and limitations were.
    • It was suggested that Sections 8 and 9(f) of the Universal Life Insurance Model Regulation needed considerable expansion. It was suggested that disclosure requirements be placed in the illustrations section of the models as well as in the contract itself.
    • Some of the items identified which should be disclosed:
      • (1) what is guaranteed versus what is not;
      • (2) adequate disclosure of the fact that a premium quoted will not support the contract for the whole life if the policy is a universal life policy;
    • (3) disclosure of the guaranteed surrender values on a flexible premium policy.

1988-2 – NAIC Proc.

Agents – Index

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Agent - Snippets - 1990s

  • (p117) - If the life insurance industry were serious about offering competitively priced policies to consumers, it would ask itself why total life insurance premium receipts of all U.S. companies in 1990 is less than the sum of new premium purchases over the last 9 years.

    • Why does it appear that consumers are replacing the industry's entire book of business every 8th or 9th year?

    • Are agents not being allowed to give consumers enough information to make informed purchases?  

--  Rick K. Nelson, Independent Insurance Agent

1991 0613 - GOV (House) - Insurance Competitive Competitive Pricing Act of 1991 - [PDF-237p-GooglePlay, 

  • As insurance producers we are not a homogeneous lot.

    • Each of us conducts his practice in a different manner. Each of us is unique.

    • Our association is big enough to contain the producers earning $1,000,000 per year along with those earning $20,000 and failing.

    • We have room for those of us who drink knowledge with a great thirst along with the many who basically don't know what they're doing.

    • Sad to say there are large numbers of producers including big earners - who are screwing the insurance buying public through their own ignorance. (p161-162)

--  Arthur Shievitz, Agent - Letter - 1990 0501

1991 0613 - GOV (House) - Insurance Competitive Competitive Pricing Act of 1991 - [PDF-237p-GooglePlay, 

  • I sincerely believe we have a flawed instrument in today's sales illustrations.

  • ...we did not communicate the impact of change as well as ...we should have.

  • Our biggest mistake would be to delay.

  • I don't believe the consumer will tolerate or forgive us, let alone the regulators, if we do nothing.

  • I'd like to stress that agents don't pretend to know the answers.

  • It is our intent to ask for your help** because we're currently living with problems that lack solutions.

    • [Bonk:  **"your help" = actuaries help]

--  Robert Nelson, Chairperson of the National Association of Life Underwriters (NALU) Task Force on Illustrations -  [Currently NAIFA]

1993 - SOA - Sales Illustrations: We Can't Life With Them, But We Can't Live Without Them!, Society of Actuaries - 20p

  • (p18) - The training we received was sales training only.

  • The home office people who came to the Sioux City, IA, office said:

    • Don't try to become a Ph.D. in variable life insurance; just learn enough to sell it and go. 

  • This is what they told the whole office, and this was how I trained any new men that I hired: 

    • Just sell it; do not worry about it. 

--  Jerry C. Keating, Training Manager, John Hancock, Iowa

1993 0525 - GOV (Senate) - When Will Policyholders Be Given The Truth About Life Insurance?, Howard Metzenbaum (D-OH)  ---  [BonkNote]

  • (p18) - Just before I got sick in 1990, the company seemed to change.

    • They started telling us about the risks.

  • The "rescue program" was the worst of the worst.

    • It was the company's solution to variable life policies that had loans on them-or did not have loans on them.

    • The management in Sioux City allowed the agents to replace every VLI policy that was written with flexible variable life insurance.

    • ...

    • The risk was placed firmly on the shoulders of the insured.

  • This statement is only the tip of the problem.

    • There are hundred and hundreds more.

    • ⇒  And, Senator Metzenbaum, I would like to tell you, sir, if you do not get the Government to do something about this, you haven't seen nothing yet.

--  Jerry C. Keating, Training Manager, John Hancock, Iowa

1993 0525 - GOV (Senate) - When Will Policyholders Be Given The Truth About Life Insurance?,  Howard Metzenbaum (D-OH)   ---   [BonkNote]

  • Randy Barkacs, Western Southern:

    • ...  said many consumers cannot distinguish between universal life and whole life.

    • ...  said a narrative explanation was needed because many did not understand the numbers or the fact that a universal life policy might drain the cash value until there was no coverage left.

1994-3, NAIC Proceedings

  • The destiny of my ease for my perspective has been determined not only by someone I've never spoken to, but more often than not, by a company of which I'm totally unaware. I don't know what company is being used or who it goes to. My company does not inform me of who the reinsurance cartier is, and in most cases is even reluctant to show the information or the name of the carrier.

  • My question is, What's the mystery? Why is this part of the underwriting process cloaked in such secrecy by the field underwriter?

--  David Rittenberg, Field Underwriter at Mutual of New York

1995 - SOA - Reinsurers and Producers: What Can We Learn from Each Other?, rsa95v21n4a24 - Society of Actuaries - 12p

SFSP – Society of Financial Service Professionals

  • JFSP – Journal of Financial Service Professionals (Current)
  • The Journal of the American Society of Chartered Life Underwriters
  • Journal of the American Society of CLU & ChFC
  • In addition, the insurance buyer can learn more about how the policy benefits may vary by reviewing alternate illustrations that project high and low interest rates.
    • Though not exact and not guaranteed, these projections are of value to the insurance buyer because they demonstrate how the life insurance policy works.

—  Prepared Statement of Brian S. Brown on Behalf of the American Society of CLU & ChFC

1993 0525 – GOV (Senate) – When Will Policyholders Be Given The Truth About Life Insurance?, Howard Metzenbaum (D-OH)  —  [BonkNote]

1980s

  • 1982 07 – JFSP – Universal Life Insurance: A Primer, by Timothy Lynch, The Journal of the American Society of Chartered Life Underwriters, Vol. XXXVI (July 1982) – <WishList>

1990s

  • 1993 05 – JFSP – The Problem With Sales Illustrations: Why it Exists and How It Should Be Addressed, by Walter Miller, Journal of the American Society of CLU & ChFC; Vol. 47, Iss. 3: 64 – <WishList>
  • 1995 – JFSP – Economic Analysis of The Development of Universal Life Insurance in The 1980’s, by D.H. Chang, Journal of the American Society of CLU & ChFC, 49, pp. 82-87 – <WishList>
  • 1996 05 – JFSP – Cost disclosure Versus Concept Disclosure: A Personal Perspective, by Randy Barkacs, Journal of the American Society of CLU & ChFC; Bryn Mawr Vol. 50, Iss. 3: 62 – 5p

2000s

  • 2007 07 – JFSP – Tips for Evaluating Existing Life Insurance Policies, by Robert Littell, Vol 61, Issue 4, Journal of the American Society of CLU & ChFC —  Part 1 – 4p  —  Part 2- 6p
    • Abstract – Evaluating most existing life insurance policies can be a complex undertaking and requires a combination of different kinds and degrees of knowledge of product information, advanced underwriting tools and techniques, and how reinsurance works, as well as some degree of medical underwriting expertise. Much of this knowledge, especially product knowledge and the role reinsurance plays, can best be comprehended by having a better understanding of the evolution of the industry.
    • Also, Profiles (www.profiles.com) offers a product called “Insurance Insight” that not only graphically helps illustrate the sensitivity within permanent life insurance policies inherent with changes in NAR, making it easier to understand, but also utilizes a powerful Monte Carlo simulation engine that uses actuarially certified industry-representative benchmark policy costs.
      • This allows you to do “what-if” scenarios, which are especially valuable in analyzing VUL.
      • [Bonk: Who was www.profiles.com?]

2010s

  • 2011 – JFSP – The Ethical Environment of the Life Insurance Industry: The Impact of the Recession and Slow Recovery, by Robert W. Cooper, PhD and Garry L. Frank, PhD,  Journal of Financial Service Professionals – 15p
  • 2015 05 – JFSP – Advisor Beliefs Regarding Effective Life Insurance Disclosure, Journal of Financial Service Professionals
  • 2019 03 – JFSP- Retirement Income From Indexed Universal Life Insurance Policies- Risks And Solutions, by Ben Wolzenski, Journal of Financial Service Professionals – 6p
  • 2019 06 – JFSP – The Pension Maximization Option: A Deeper Dive, by Douglas B. Richards, Journal of Financial Service Professionals – 4p

Advice

  • Incidental Advice
  • Thomas v. Metropolitan Life Insurance Company, Case No …Aug 31, 2009 – This policy was a variable universal life insurance policy. The Third … advice “solely incidental to” the conduct of business as a broker or dealer.
  • … under the IAA if the advice they give is “solely incidental to” their broker activities and they receive “no special compensation” …
2020 – LR – Thomas v. Metropolitan Life Insurance Co.: Semantics, Fiduciary Duty, and an Outdated Distinction, by Jeremy Liles – 21p

Promises

  • At the 1986 Annual Meeting of the American Council of Life Insurance ACLI Chairman John Pearson stated:
    • Our products must do what we say they do.
    • Our companies must fulfill their promises.
    • All the words in the world – the best government relations, the best public relations-will not be enough without performance.  (p2)

1987 01 – SOA – Non-Guaranteed Promises: A New Standard of Practice, William T. Tozer, Actuarial Update, Society of Actuaries –  8p

  • The New York Life promised:
    • on a 20 year endowment $1,650 and paid $710;
    • on a 20 year deferred dividend $1,143 and paid $527;
    • on a tontine it estimated $1,234 and paid $564;
    • on another $954 and paid $390.
  • As anyone reading the policy forms will note, these estimates are not part of the contract which provides that the policyholder is entitled to only what dividends or investment profits the officials of the company choose to apportion to him.
    • The promise is made by the agent in separate printed estimates which purport to be the experience of other policyholders and which the prospective policyholder is assured will be equaled in his case.
    • Whether or not the statements are true in regard to the returns some policyholders have received, there is no question that they do not come true in nine cases out of ten.

1906 – Book – How to Buy Life Insurance, by QP – [Bonk: Anyone know who this is? My guess is Miles Menander Dawson]

  • The promise has changed:
    • … from “I will guarantee that the premium you see will provide the benefits you see, and maybe share future good times with you”
    • … to a promise of “I will share the good experience I expect with you now, but if it doesn’t happen you will have to pay me more than you may have expected to.”

—  Bruce E. Booker

1988 – SOA – Update on Universal Life Reserves and Non-Forfeiture Values, Society of Actuaries – 36p

  • Policy illustrations continue to be the dominant tool used within the life insurance industry to compare the relative cost of death benefit protection between various companies and products.
    • This is somewhat unfortunate, given that the only promise a life insurance company makes when it sells a product are the contractual guarantees.
  • Policy illustrations are not promises; rather they are hypothetical illustrations of what might happen if certain, often undisclosed assumptions come true.  (p8)

—  Mel G. Todd, President, Clark/ Bardes – fellow of the Society of Actuaries and a member of the American Academy of Actuaries and the National Association of Life Underwriters

1993 0525 – GOV (Senate) – When Will Policyholders Be Given The Truth About Life Insurance?, Howard Metzenbaum (D-OH)  —  [BonkNote]

  • One problem area in a lot of policies has been interest rates.
    • A slow cumulative, very large decline in interest rates has affected everything.
  • Why are we getting so many complaints?
    • Did the policyholder expect rates to stay the same forever?
    • Did the agent or the company mislead?
    • Did the policyholder think we were promising?
      • He shouldn’t have, I hope he didn’t.

—  Bruce E. Booker, Life of Virginia, a member of the American Council of Life Insurance (ACLI) Task Force on Cost Disclosure and the National Association of Insurance Commissioners (NAIC) Advisory Group on Illustrations

1993 – SOA – Sales Illustrations – We Can’t Life With Them, But We Can’t Live Without Them!, Society of Actuaries – 20p

  • On perhaps the bad side, the potential buyer is now being subjected to sales illustrations from companies that look identical to him.
    • Some of these have 7% current scale interest rates, some have 13%, some are front loaded, some are back loaded.
      • He sees all kinds of different promises.
    • How can he assess the credibility of these proposals?
    • What promises are actually being made?
    • How much risk is he taking and how much is he transferring to the insurer?
    • Does he know what things can change and what things can’t?
    • How much should we tell him?
    • How much does he want to know, for that matter? (p1558-9)

—  Bruce E. Booker

1988 – SOA – Update on Universal Life Reserves and Non-Forfeiture Values, Society of Actuaries – 36p