• [Glenn Daily is particularly irate about what the industry calls "lapse supported pricing," which is used in illustrations to show higher cash values in later years.
• Actuaries who use this technique know that only half the people who buy policies will still have them after seven years.
  • After 20 years, only about 25 percent will still have them.
  • In the illustration, the actuaries assume that the insurer will spread the premium dollars from those who dropped their policies among those who held on.
  • There is, of course, no guarantee the insurer will actually do this.

1994 0227 - NYT - Your Own Account; What's Wrong With This Picture?, By Mary Rowland - [link]