Deposit Term

  • One could almost argue that Universal Life is an outgrowth of Deposit Term.
    • Most Universal Life policies have initial sales charges, that from a practical sense resemble a deposit term contract, sold with an annuity rider. 

--  Fred Jonske

1984 - SOA - Individual Term Portfolio Management, Society of Actuaries - 22p

  • 1979-2, NAIC Proceedings
  • "An Analysis of 'Deposit Term' Life Insurance." Best's Review
    • Life Insurance Cost Disclosure: A Staff Report to the ...
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      United States. Federal Trade Commission. Bureau of Consumer Protection, ‎United States. Federal Trade Commission. Bureau of Economics · 1979 · ‎Consumer protection
      ... Best's Review , Professor Harold Skipper of Georgia State University calculated ... An Analysis of ' Deposit Term ' Life Insurance , Best's Review , at 10 ...
    • FTC Study of Life Insurance Cost Disclosure: Hearings Before ...
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      United States. Congress. Senate. Committee on Commerce, Science, and Transportation · 1980 · ‎Disclosure of information
      ... Best's Review , Professor Harold Skipper of Georgia State University calculated ... An Analysis of ' Deposit Term ' Life Insurance , " Best's Review , at 10 ...

    • MUNSELL, LUCILLE v. ROGERS CORPORATION Et Al

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      Mar 22, 2022 — "An Analysis of 'Deposit Term' Life Insurance." Best's Review, Life/Health ed. 79 (August 1978): 10, 12, 59-60. Skipper, Harold D. "Issues ...

 

  • The third and last major type term policy we offer is deposit term.
    • Technically it is not a term policy but a modified whole life policy.
    • Practically it is a sort of hybrid policy with both term and permanent characteristics.
    • The primary problem with the policy seems to be a lack of understanding of what the policy is and how it compares with more traditional type permanent and term products.
    • Marketing practices, in some cases, have unhappily been less than honest and have taken advantage of some of these misunderstandings and created confusion.  

--  Burnett A. Halstead, Jr., Kemper

1977 - SOA - Actuarial Considerations in the Design of Term Products, Society of Actuaries - 12p

  • 30 For example, whole life policies are often replaced with deposit term insurance, see Skipper,· "An Analysis of Deposit Term Life Insurance," Best's Review, 10 August, 1978).
  • There is an enormous variation in the quality of deposit term products on the market. See pages 108-109, infra.
    • Substantial consumer injury can result if a low cost (hlgh-yield) whole life policy is replaced with a high cost (low-yield) deposit term policy. (p45) - <WishList>

1979 - FTC - Report - Life Insurance Cost Disclosure - 460p

  • Finally, l come to the matter of reserves and nonforfeiture values on deposit term and deposit whole life type contracts.
    • Instances of unusual and inappropriate patterns of reserves and cash values have been noted.
    • Because of this, consideration is being given to new regulation and statutory language in order to produce more acceptable results.
  • I would like to repeat here the point l made at the meeting that the existence of strange results suggests that inappropriate actuarial techniques may have been used to produce those results and that actuarial procedures and methods that are applicable to standard straightforward pans are not necessarily applicable to these special plans without an examination of the implications and assumptions of the usual actuarial methods.
    • In particular, I believe that many of the strange results produced arise because of the unusual premium payment pattern. 
  • That may produce, at some policy durations, a present value of future benefits less than the present value of that portion of the adjusted premium which was to pay for those benefits.
  • In such a case, it is improper actuarial practice to take into account those excess premiums.

(ATTACHMENT C·2)
To: Mr. Ted Becker, Chairman, NAIC (C) Committee Technical Task Force on Valuation and Nonforfeiture Value Regulation
From: Paul E. Sarnoff -The Prudential Insurance Company of America

1980-1, NAIC Proceedings

  • There will continue to be a market for term insurance.
  • What will be the structure of and assumptions used in the product?
    • (Recall that select and ultimate term are mortality and tax driven, not persistency driven.)
  • 2. Term policy with cash value wrapped around it. - [Bonk: Universal Life]
    • This is just the old minimum deposit plan.
  • This product will have no problem with the 818(c) adjustment because it is whole life.

--  Lawrence Silkes, Vice President and Chief Actuary of New Jersey Life

1983 - SOA - Individual Life Insurance, Society of Actuaries - 22p

  • MODEL REGULATION ON PARTIAL-ENDOWMENT-TYPE ("DEPOSIT-TERM-TYPE") INSURANCE, (Exposure draft)
    • The nature, cause, and resolution of complaints most frequently received by insurance companies and state insurance departments

198x, NAIC Proceedings

 
 
  • ACLI Draft Proposed Minimum Nonforfeiture Guideline Requirements for Approval of Partial-Endowment-Type Products - October 2, 1978

1979-1, NAIC Proceedings

  • Ms. Edwards reported that the task force recommended the adoption by the (C3) Subcommittee of the Model Regulation for Partial Endowment type (Deposit Term) policies which was circulated in December, 1979, as an exposure draft.
    • Following discussion and upon a motion duly made and seconded, the subcommittee referred this exposure draft to the Evaluation Life Insurance Cost Disclosure Task Force for consideration as to whether this type product can be treated under the Model Life Insurance Solicitation Regulation or whether a separate regulation must be used to properly disclose factors pertaining to this product.

1980-2, NAIC Proceedings