Walter Chapin

  • In 1965, when Combined Insurance Company determined that the time was right for it to enter the life insurance market, Walter Chapin was hired as a consultant.
    • Walter suggested a product concept from which was designed that first "prototype" adjustable policy.
    • It was adjustable in that it permitted the policyholder to, at his option, adjust his face amount.

--  Spencer Koppel  

1979 - SOA - Future Trends and Current Developments in Individual Life Products (rsa79v5n44), Society of Actuaries - 24p 

  • [Walter Chapin]
  • A product innovator of extraordinary talent, Mr. Chapin had begun thinking in the 1940s about the possibilities of a flexible life insurance policy, but saw that its complications were then unmanageable.
    • By the 1960s, recognizing that advent of computers had changed all that, he resigned from his company to concentrate on the idea.
    • After he had approached several companies with designs, Minnesota Mutual agreed to undertake development of such a contract.
    • Introduced in 1971, adjustable life, the first policy designed to take care of a lifetime of changing insurance needs, and its later cousin, variable adjustable life, accounted in due course for 95 percent of that company's individual life insurance sales.
  • In his 1976 Society paper, "Toward Adjustable Individual Life Policies" (TSA Vol. XXVIII, p. 237), Mr. Chapin graciously attributed the birth of the idea to the late Edward A. Rieder (TASA XLVIII, 1947, p. 283), and acknowledged the impetus given it by Alfred N. Guertin in a 1964 report. 
  • Further particulars of the history of this product can be found in Wilfred A. Kraegel's discussion of Mr. Chapin's paper.

SOA Obituary, p670-671 - b1902-d1992

  • This leads to the second attitude adjustment that is needed.
    • The old distinction between term and permanent is usually not appropriate for an adjustable life policy.
    • In every sense an adjustable life policy should be a permanent policy regardless of what the current static plan may be.
      • Its flexibility means that it can be the only policy a person ever owns even if the initial version corresponds to a ten-year term plan.
    • An adjustable life policy can be adjusted upward or downward in amount and/or premium to accommodate the needs and premium capa­bilities of the insured.
    • ⇒  It seems better to look at it in terms of what it can adjust to in the future rather than to concentrate on whatever plan today's premium/face amount relationship requires for defining values and dividends.
    • The emphasis should be on the basic permanent result that flows from the adjustability.

1976 - SOA - Toward Adjustable Individual Life Products, Society of Actuaries, by Walter L. Chapin - 50p