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 - 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.