Options - Life Insurance Policy

  • Michael Lovendusky, ACLI ...said the ACLI work group thinks that most confusion for consumers involves complex products like universal life, and not Simple products like term life.
    • He said consumers are mostly confused about options, guarantees and riders.
  • The ACLI work group was considering asking the life insurance and Annuities (A) Committee to narrow the charge to look at only products with options, guarantees and riders, but Ms. Cude said she thinks that it is important to consider how the disclosures for all products could be improved.

2016 0403, NAIC Proceedings - LIIIWG - Life Insurance Illustrations Issues Working Group, Conference Call

  • 1982 - AP - The Life Insurance Policy as an Options Package, by Michael L. Smith, The Journal of Risk and Insurance, Vol. 49, No. 4, (Dec., 1982), pp. 583-601 (19 pages) Published By: American Risk and Insurance Association - JSTOR
  • 1985 - AP - The Whole Life Insurance Policy as an Options Package: An Empirical Investigation, by Michael L. Walden, The Journal of Risk and Insurance, Vol. 52, No. 1 (Mar., 1985), pp. 44-58 (15 pages), Published By: American Risk and Insurance Association - JSTOR
  • The ACLI’s Dolan says the size of the premium depends on the returns on the options in the policy.
    • “The fact is, in a different (and better) economic environment, less in premiums would be paid than originally planned,” he notes.
  • “Owners of this product must be aware of exactly how it works, because, unlike certain other types of life insurance, IULs have a fluctuating component to them.”

2020 0923 - Forbes - Sounding The Alarm On Indexed Universal Life Insurance - [link]

  • Policy Overview
    • Birny Birnbaum (CEJ) - Policy Overview only applies when the consumer is shopping for the policy.
    • Michael Lovendusky, ACLI - Neither model was intended to generate Buying Guides or to relieve consumers of their own individual responsibilities to understand the product that they are spending their hard-earned money to buy after all.
      • And what has happened most recently is that.. And indeed in the most recent development …there are examples of companies attempting to develop completely Dynamic services and policies opportunities for their customers to purchase and to elect a variety of options.
        • And that the options themselves might be changed over time, dynamically, at the will of the purchaser with perhaps his or her financial advisor. 
        • And so, one must I think wonder we're actually whistling into the winds of change here by attempting to make these summaries and overviews more static and less dynamic.

2018 1109, NAIC - LIIIWG - Life Insurance Illustrations Working Group, Conference Call, [Bonk: Not in NAIC Proceedings]