Off-Track / On-Track

In essence, the model regulation <Universal Life Model Regulation> assumes that at issue, all universal life policies are permanent plans.

The r-ratio is meant to measure the extent to which the policy is "on track" as a permanent plan.

Statutory Valuation of Individual Life and Annuity Contracts | 5th Edition Claire, Lombardi and Summers

Mr. Wicka said the paper <Assurity White Paper> advocates for: 1) additional information to be provided to consumers regarding how the timing of their payments impacts the product; and 2) follow-up information to be provided to consumers at the time their payments go off-track so that consumers are aware of the impact to their policies.


"This was an optional idea that we called "Illustrations As Road Maps."
The concept is that instead of letting the actual performance of a Universal Life policy diverge over time further and further from what was originally illustrated, you could send policyholders a notice each year on the anniversary, if the results are below what was illustrated.
A letter would state the need to pay an additional amount to get back to what was illustrated, because interest rates are lower. This would have two advantages.

First, it would keep people on track with their illustrations."
Second, it would help people understand the workings of their universal life policy."  John Keller

1991 - Illustrations - Society of Actuaries

Universal Life Insurance, a 1980s Sensation, Has Backfired
Sep 19, 2018 - Wall Street Journal, Leslie Scism
Universal Life Insurance, a 1980s Sensation, Has Backfired ... in 2000 that the universal-life policy she bought in 1983 was financially off track.