Games, Gimmicks and Tricks

  • Why is this flimflammery allowed to continue?
  • Where are the laws to prevent companies from misleading people?  (p3)

--  Senator Metzenbaum

1993 0525 -  GOV (Senate) - When Will Policyholders Be Given The Truth About Life Insurance? [PDF-354p-GooglePlay, No Video]

  • It is my recollection and understanding that AG 49 was created in part due to a problem with ‘gamesmanship’ in IUL illustrations.

--  Letter - Mike Yanacheak - (IA)

2014 1113 - NAIC - IULWG

Mr. Morgan, referring to the report of the committee' on assets and investments, spoke as follows:

  • Life insurance is a theme that should be approached and handled reverently and discreetly, and, I would add, with a fear of God, for it is little less than holy ground; hence, carelessness and  ignorance, empiricism and charlatanry, should be excluded from its high places.  (p30)

--  N.D. Morgan - (president of the North America Life insurance company)

1871-1, NAIC Proceedings

David H. Raymond:

  • From several sources I have gotten the opinion that interest rate games used to be almost invincible in the early years of Universal Life.
  • Partial sophistication now has reduced their effectiveness, so that the emphasis is turning toward cost-of-insurance games.
  • Almost nobody can understand those yet.
  • They work wonderfully, at least for the next 10 years.

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

  • After the introduction of indexation, this was no longer a problem except for some "tricks"
  • e.g.,  At one point, indexation was only semi-annual and not monthly, so people took policy loans one day after the indexation day and repaid the loan prior to the next indexation day.
    • They made a lot of money out of these transactions.

-- **Dr. Kahane, not a member of the Society, is Associate Professor and director of the insurance center at Tel Aviv University.

1982 - SOA - The Experience of Living Under Sustained Inflation, Society of Actuaries - 18p