Tag: webcast

When Was the Last Time You Gave an Inforce Illustration to Every Single Policyholder? It’s TIME!

Presenter: Bill Atlee, Chief Strategy Officer & Co-Founder, iPipeline

Interest rates have been historically low for 10 years, which has placed tremendous performance pressure on illustrated products. Most policyholders are unaware of how this impacts their policy, and if their current values still meet their original expectations. The challenge is, less than 1% of policyholders actually receive an inforce illustration to gain this valuable insight. Why? The majority of carriers don’t have the ability to run the hundreds of thousands of inforce illustration necessary to educate ALL of their policyholders each year. The last several years, our industry has paid out over 6.6 billion in class action law suits on this topic alone.

Join our Co-Founder and Chief Strategy Officer, Bill Atlee as he discusses:

  • How your existing legacy inforce software can still scale to generate millions of illustrations
  • Why it’s critical to know the financial “health of your block”
  • How to identify your most vulnerable policyholders that are in danger of future involuntary lapse
  • How you can help policyholders course correct, before it’s too late
  • How most carriers overlook $200 million of untapped premium

Industry Address with iPipeline CEO Larry Berran and special guest Dan LaBert, NAILBA CEO

Presenters: Larry Berran, CEO, iPipeline and Dan LaBert, CEO, NAILBA

The current global situation is unprecedented. Larry speaks candidly about continuing to run iPipeline and support our employees and customers emotional, financial, and business needs. He discusses iPipeline’s business continuity plan and what we’re doing to maintain a sense of normalcy, and how our technology can mitigate risk for you, your agents and advisors, and customers. Dan brings a perspective on current industry pressures, and how NAILBA is working with its membership to achieve balance and maintain stability.

Insurance Carriers and COVID-19: Current State and Planning for a New, New Normal with Novarica

Presented by: Rob McIsaac, Executive Vice President, Research & Consulting, Novarica

With insurance carriers facing a range of challenges and opportunities, planning for what amounts to a “New Normal” takes on an increased urgency across all lines of business. Rapidly shifting demographics, a persistently low interest rate environment, changes in customer preferences, and an evolving competitive landscape all factor in as considerations carriers need to be preparing for now. Emerging technologies, and the potential for Innovation to foster meaningful change, represent very real “levers of opportunity” for carriers, are explored during this session.

When Was the Last Time You Gave an Inforce Illustration to Your Policyholders? It’s Time.

Carriers Are Feeling the Impact of Negative Interest Rates

Without a doubt, carriers are under enormous pressure to maintain profitability in a low interest rate environment. Historically low interest rates over the last 10 years have pushed many carriers into a negative interest rate environment, meaning the money carriers invested in the open market cannot earn what they promised policyholders in contracts sold many years ago when yields were at 10%. Millions of universal life contracts, as well as interest-sensitive whole life policies, offered guaranteed interest rates of 4-5% and guaranteed cash value. Most of these older contracts are now paying the minimum interest rate guarantee (maybe 3%) and in some cases, carriers have raised their mortality rates to offset these losses. The impact on policyholders: their contracts are under-performing, which results in involuntary lapse or policyholders that outlive their contracts.

Policyholders Deserve to Know

The fact is, the only way to give a policyholder a present snapshot of the “health of their policy” is to run an inforce illustration. These new projections can give a client a good indication on how the policy values will perform at current assumptions. Doesn’t every policyowner deserve to know from their carrier today how future projections impact their financial expectation? There’s a problem though- most of the old illustration software that calculates these projections is sitting on old architecture and can’t scale. Why wasn’t this illustration software modernized on new infrastructure? The answer: because the majority of these products have been discontinued and are no longer sold through agents. Consequently, agents don’t need to access it. This software is usually used by the home office staff to satisfy an inforce illustration request from an agent or policyholder… and less than 1% of policyholders receive an inforce illustration each year.

Can the Course Be Corrected?

If most carriers’ inforce illustration software resides on Windows 95/98 machines, mainframes, or is hand calculated by actuaries, it’s virtually impossible to provide every policyholder with current projections each year. The solution simply doesn’t scale to educate existing policyholders on their policy performance.

Here’s what I mean by not scaling- Let’s say you have 500,000 policyholders on your inforce block and you want to give each policyholder an inforce illustration. That would be 500,000 inforce illustrations that the home office would have to manually run each year. Sound like it’s not humanly possible? Let’s look beyond this assumption.

Imagine the complete irresponsibility of simply telling policyholders that their policies are under-performing, and not providing them with ways to course correct. That alone would generate tens of thousands of calls from panicked policyholders into a carrier’s call center. So providing policyholders with options is a must. For example, can they reduce their face amount or add premium to extend the policy years farther into the future? We factored that it would take an additional 8 inforce illustrations for each policyholder to provide these critical options. You did that math correctly: this would mean running 4,000,000 inforce illustrations (500,000 policyholders x 8 illustration options each) to accomplish this task- daunting at best! 

Why It Needs to Be Done…Now

Our industry has had over 6.6 billion dollars in class action suits over the last several years for improperly informing their policyholders of this ticking time bomb. It’s time we solve this problem. It’s our fiduciary responsibility as an industry to meet policyholder expectations.

We at iPipeline have a solution for this industry-wide dilemma- it’s innovative, avoids the financial burden of rewriting all of a carriers’ legacy inforce illustration software, and makes the task far more approachable.

I’m very passionate about this topic, and I’m looking for your thoughts as well.