This article discusses the impact of the prolonged low interest rate environment on universal life (UL) products, especially with respect to the development of new products to meet the challenges imposed by low market interest rates. New products such as fixed indexed UL (FIUL) and secondary guarantee UL (SGUL) have come into their own over the past decade. FIUL provides upside cash value potential through the purchase of call options on well-established stock indexes (e.g. S&P 500); SGUL is more geared towards providing protection through the use of a shadow account; several SGULs on the market provide death benefit guarantees to attained age 121.
Triangulation is the process of using a third “test tool” system to test and compare values being generated by two other disparate systems. With respect to life insurance illustrations, for example, testing involves comparing values generated by the illustration software against the client’s expected values generated using their own internal software. Triangulation comes into play when the values generated by these two systems do not match. The third system is used to test and see which (if any) of the results from the other two systems are correct. The triangulation approach is used to help resolve issues quicker and in a more objective manner.
Take a look at how some Broker-Dealers are approaching the new rules and creatively meeting the challenges of compliance when certainty may be in short supply. Make no mistake; there is certainty in the wealth management community regarding the deadline for compliance with FINRA rules 2090 and 2111 and all firms are taking the new rules seriously. Regardless of where Broker-Dealers are in the implementation process, they have been receptive to looking at solutions that can offer flexibility while also minimizing operational cost associated with rework and tech-heavy solutions.
The life and annuity insurance industry is extensively a form driven business. In many business cases, forms with a signature continue to be required by regulation or by the compliance department; and support of e-signature presents the opportunity for the industry to go completely electronic. ACORD developed the eLabels by following stringent Naming and Design Rules to establish reusable “tags” that can be used consistently across all forms and processes. The life and annuity industry is utilizing ACORD eLabels to make form data more accessible and more effective in electronic processing workflow. Learn about FireLight by Insurance Technologies, which is an electronic fulfillment and in-good-order business processing platform that is 100% flexible to meet any demand and work across ALL lines of business.
Over 40 million people in the US are over age 65. AARP reports that approximately 8,000 people per day will reach retirement age for the next 18 years. With changing demographics come diverse sales opportunities. Many of those in the older demographics are using technology as never before; this area is evolving quickly and will continue to change and grow as people become more connected. The opportunities and challenges are many. With this changing market your producers will appreciate the support you can offer. The extensive options to provide supplemental marketing materials and communication via ForeSight can be part of this support.
Internal Revenue Code Sections 7702 (DEFRA) and 7702A (TAMRA) were made part of the U.S. tax code in the 1980s for purposes of developing life insurance policy taxation standards for newer products of that era (such as universal life). Implementing and maintaining both of these IRS codes have taken companies several years as both 7702 and 7702A were quite complex in nature and wide ranging in scope. Many companies to this day have systems and software that are continually being refined to handle both IRCs as there were a lot of gray areas in both IRCs that took several years to clarify.
As cyber terrorism is becoming more complex and difficult to detect, data security is also on the rise. A Layered security offers a more holistic approach to data security by ensuring full compliance with regulations when hosting private data. ViaWest, a provider of colocation and managed services, discusses the benefits of a Layered Approach and how you get to a Layered Approach. ViaWest provides a range of professional security services, from Managed Firewalls to Virtual Private Networks to Anti-malware, Integrity Verification, Global Directory Authentication Services, Intrusion Detection and Log Management Services.
A new article in from SENIOR MARKET ADVISOR titled “Afraid to jump on the technology bandwagon? Don’t be.” by David Port discusses how Advisors can no longer get by without the use of tech tools.
From “cloud-based platforms and mobile apps to hardware, utilities and software systems, some of the advisory community’s leading tech minds share their most indispensable, empowering, intriguing and ROI-generating tech tools for 2012 and beyond” in this article.
Life insurance and annuity proposal systems have undergone significant changes over the past few decades as products, regulatory issues and financial reporting standards continue to increase in complexity and sophistication. As proposal systems have ramped up to handle newer and more algorithmically complex products, the need for and involvement of actuarial expertise at both the company level and vendor level has increased in an effort to continue to provide for accurate and timely proposal software. With today’s demands to deliver products to the field in an opportune manner, ongoing actuarial involvement is one of the main keys to assuring success.
Participating whole life has been around for over a century and has recently seen a rebirth as a result of volatile economic times and life product creativity. Participating whole life provides the underlying guarantees of a whole life product with enhanced flexibility of dividends. Dividend options provided by most carriers include the ability to use a dividend to purchase additional insurance on a paid up basis, lower premiums, leave the dividends in the policy to accrue at interest, take the dividends in cash, use the dividend to pay down a policy loan balance or to fund a participating rider.