7702 News & Updates

[KozyInsure]

Been on and off Ins Forum for years, just joined.

Why is there no threads about 7702. This is the MAIN TOPIC of the last two months. Every webinar is talking about band-aids companies are using or starting fresh products coming out in October. I see that starting in JULY commissions will be slashed. I also have seen an average amount of risk (pure insurance) being slashed up to 44%!!! 44% lower initial insurance for 30 y/o, 30% lower for 45 y/o, 27% less initial life insurance for 60 year olds. Performance will increase, yet the insurance company must make their profit as well.

What is your experience with the company you are working? Are you finding the same results? Which companies have bandaids and which have new products coming out and when?

Thank you all for your insight,

KozyInsure

 

[DHK]

We have threads. You're just late to the party.

https://insurance-forums.com/community/threads/infinite-banking-and-changes-to-7702.104492/

https://insurance-forums.com/community/threads/changes-to-7702-b-2-a-minimum-interest-rate.104282/

 

[Allen Trent]

. I see that starting in JULY commissions will be slashed.

You are seeing carriers slash commission rates? Or are you saying the agent & client can now design cases with less costs to be incurred & therefore the agent & client will not have as high of target premium & more excess/over funding?

Also, lower target & lower net amount at risk will also directly impact carrier profit as they charge COI on those insurance amounts. Very little profit on the over funding component compared to the profit on the COI & policy fees

Protection focused no lapse products likely saw price increases with the non forfeiture & valuation rates changed by a different regulation

 

[KozyInsure]

You are seeing carriers slash commission rates? Or are you saying the agent & client can now design cases with less costs to be incurred & therefore the agent & client will not have as high of target premium & more excess/over funding?

Also, lower target & lower net amount at risk will also directly impact carrier profit as they charge COI on those insurance amounts. Very little profit on the over funding component compared to the profit on the COI & policy fees

Protection focused no lapse products likely saw price increases with the non forfeiture & valuation rates changed by a different regulation

I'm not an industry "insider" or anything, I just have attended webinars from 4 IMOs, and a dozen different carriers all basically saying the same thing. 1. They are the biggest and best selling company, 2. They all need to go back to the drawing board for the 4th time in recent years. 3. Some companies are using band aids while others are not making any changes until the beginning of the 4th quarter.

The info I quoted from the first post is from a webinar I attended.

If you go to IULDIGEST.com to other GURUs its always been North American, Securian (Minn LIfe), Allianz Life, as the go to carriers. Some say Accordia G.L. and Prudential are the best for IUL. National Life Group has the most flexibility. F&G pathfinder is the best for smaller premiums. Lincoln and New York Life has the largest policy renewals. WinkIntel has its report showing sales vs number of policy holders. Global Life said TODAY they are the biggest W.L. carrier at 200B and will keep a 4.5% guarantee interest but nobody knows for sure.

Too many changes in a short amount of time for decisions that last a life time.

And Yes that's what I'm saying. :-)

Was it National LIFE Insurance day May 3rd?

 

[Tahoe Ray]

I'm not an industry "insider" or anything, I just have attended webinars from 4 IMOs, and a dozen different carriers all basically saying the same thing. 1. They are the biggest and best selling company, 2. They all need to go back to the drawing board for the 4th time in recent years. 3. Some companies are using band aids while others are not making any changes until the beginning of the 4th quarter.

The info I quoted from the first post is from a webinar I attended.

If you go to IULDIGEST.com to other GURUs its always been North American, Securian (Minn LIfe), Allianz Life, as the go to carriers. Some say Accordia G.L. and Prudential are the best for IUL. National Life Group has the most flexibility. F&G pathfinder is the best for smaller premiums. Lincoln and New York Life has the largest policy renewals. WinkIntel has its report showing sales vs number of policy holders. Global Life said TODAY they are the biggest W.L. carrier at 200B and will keep a 4.5% guarantee interest but nobody knows for sure.

Too many changes in a short amount of time for decisions that last a life time.

And Yes that's what I'm saying. :-)

Was it National LIFE Insurance day May 3rd?

Dude...take a deep breath.

We're all here with you in the same boat.

A lot of us subscribe to IULdigest and the founder of Wink, @Sheryl J Moore is here on the forum.

The sky is not falling. Things are just changing as they tend to do in our business.

Let everything shake out and we'll see where we are at. This may not end up being a bad thing (if you read those other threads that DHK posted).

 

[Allen Trent]

Global Life said TODAY they are the biggest W.L. carrier at 200B and will keep a 4.5% guarantee interest

Did you record this or get it in writing? I have not seen a WL policy in years with a guaranteed of 4.5%

 

[walthamny]

Every couple years, there is some event/issue that IMO's will claim is once in a century event, if you dont take action now, you wont have a chance again until comet Haley is back in 2061, this time everything is different and so on. 7702 is one of them, it will mean changes in pricing and commissions possibly. But trust me, life will still go on as usual afterwards. It is possible any change will get mixed with how consumers react to the pandemic. Life insurers depend on a certain lapse rate on policies. When a 80 year old cashes out a UL policy, its great news for the insurer. It is quite possible the post pandemic world could shift consumer behavior in a way that hurts the Life Insurers. And they will make up the difference somewhere else. Dont count on them cutting upper management bonuses first

 

[scagnt83]

If you go to IULDIGEST.com to other GURUs its always been North American, Securian (Minn LIfe), Allianz Life, as the go to carriers. Some say Accordia G.L. and Prudential are the best for IUL. National Life Group has the most flexibility. F&G pathfinder is the best for smaller premiums. Lincoln and New York Life has the largest policy renewals. WinkIntel has its report showing sales vs number of policy holders. Global Life said TODAY they are the biggest W.L. carrier at 200B and will keep a 4.5% guarantee interest but nobody knows for sure.

Deciding on the "best" is not only highly subjective, but also requires a crystal ball to predict the future.

Current illustrations dont mean jack. North American has the best performing illustrations out there right now... but their renewal rates are horrible. In 20 years, those policies will look nothing like the illustrations... not even close.

Look at renewal rates to judge an IUL policy. Current rates are meaningless. Way too many carriers are using "teaser rates". Then 2-4 years later, they release a new IUL product with high caps (to keep new sales coming in) ... and drop the caps on the existing IUL lines. This is North American's method of operation ever since they started selling IUL.

Just compare how many IUL policy lines NA has, vs. someone like Penn Mutual... who has just 1 single IUL line and gives the same Cap rates to existing policy holders as they do to new policy holders. The difference is like night and day.

If you care about your clients well being 20-30 years down the road. Then renewals rates should be the single largest deciding factor for an IUL policy. (after UW)

 

[scagnt83]

Too many changes in a short amount of time for decisions that last a life time.

You are letting this IMO scare you. There is no reason in the world why a client cant make a long term decision right now.

These changes are only for newly issued policies. Not in-force policies.

If you sell a policy today, the new regs have zero effect on the client.

 

[scagnt83]

Every couple years, there is some event/issue that IMO's will claim is once in a century event, if you dont take action now, you wont have a chance again until comet Haley is back in 2061, this time everything is different and so on. 7702 is one of them, it will mean changes in pricing and commissions possibly. But trust me, life will still go on as usual afterwards.

Exactly. This guy is being scared by a marketing stunt by this IMO.

Our industry has major changes every 8-10 years of some kind. There is always some outfit claiming its the end of the "good times". Its just a ploy to drum up biz and position themselves as "knowledgeable" by using scare tactics.