Industry Commentary
#256 | Symetra’s Gambit – Follow Up
In late 2013, just before I closed down the first iteration of The Life Product Review and joined MetLife, I wrote an article entitled Symetra’s Gambit. The crux of the article was that Symetra was carving out marketshare by offering…
#253 | The End of the Asset Management Era
The typical narrative in the life insurance business is that falling interest rates are an unmitigated disaster for life insurance companies resulting in spread compression, unsupportable guarantees, expense pressure and general malaise. There’s certainly truth in the narrative – and…
#249 | AIG Exits Life & Retirement
Yesterday, AIG announced that it has made the strategic decision to exit its Life & Retirement division in order to create two distinct “market-leading” companies with AIG itself focusing exclusively on its P&C business. The details of the separation have…
#247 | AG 49-A & Product Development
This article was originally intended to be published in a publication for actuaries. Trying to make Indexed UL illustrations work within the Illustration Model Regulation is like trying to get a Sumo wrestler to do ballet. It’s possible, but not…
#243 | Rethinking Whole Life Dividends
One of the things I’ve been hearing a lot recently, especially from folks on the independent side of the business, is some variant of the argument that low interest rates are going to crush dividend scale interest rates (DSIRs) on…
#237 | The Tangled Reinsurance Web – Part 6 – Through The Maze
At last, we’ve come to the end of this series that attempts to untangle the tangled web of reinsurance. It seems like an eternity since the first article was published at the end of April. What have we discussed so…
#224 | The Tangled Reinsurance Web – Part 5 – The Power of Coinsurance
The tension between growth and capital is as old as time, but it takes on a unique dimension for life insurers. Most businesses view capital as a cushion to ride out temporary setbacks in the core business or to fund…
#223 | The Tangled Reinsurance Web – Part 4 – Coinsurance and Capital
As we’ve already seen, the power of coinsurance is that a life insurer can essentially borrow the economics of another life insurer within the defined confines of the reinsurance treaty. It’s not unlike what John and Jeremy, the protagonists of…
#220 | The Tangled Reinsurance Web – Part 3 – Coinsurance
For all of its subtleties, coinsurance is exactly what it sounds like – co-insurance. Both the direct writer and the reinsurer are on the hook for the liability, the reserves and the capital in proportion to the coinsurance agreement. But,…
#219 | The Tangled Reinsurance Web – Part 2 – YRT
If life insurance companies are a prism struck by white light, which represents the combined risks embedded in each policy they sell, then reinsurers specialize in particular parts of the light spectrum splaying out on the wall behind the prism.…
