Anyone Worried About Genworth's AM Best "A-" Rating??

[WinoBlues]

This is true... just as banks fail are often taken over by another bank.

However, that doesn't mean that we, as agents, who want to show confidence in the companies we represent, EVER want to have knowingly sold a policy from a company where that has an increasing likelihood of that happening (at least according to ratings agencies).

This isn't just an issue of logistics and protection. It has to do with professionalism in our recommendations. While we cannot predict the future of any insurance company, we'd like to be certain that we are offering quality companies.

Agreed. If an agent has been an agent for a while they have had many opportunities to apologize. ULs employing, term conversion options going into the toilet, ART rates raising higher than the original illustration, divided scales changing, selling the client on A+ rated Star Insurance Co then the book of business is sold to Reliacoal Assurance and so on.

Why write a company that lowered conversion options, then has a lowering of ratings. Add difficult, in my opinion, underwriting? To many options out there to do that to my clients or myself.

 

[Robert Barney]

So no one who ever bought a guaranteed term policy from a company that failed, lost their policy.

If I am investing large amounts of money in a life insurance company, like an annuity or non-guaranteed UL product, I'll want to be much more diligent than if I am buying a 20 or 30 guaranteed term policy.

My view is that if I am looking at a minor difference in price between an A- or an A+ carrier, I would probably go with the A+ carrier.

On the other hand, I remember Confederation Life, and how the A.M. Best ratings fell weekly before the Canadian regulators stepped in and closed down the operation.

But either way, as a 20 or 30 year term buyer, I should not be too worried that the product won't be in force later, due to a life company failure.

 

[ltcadviser]

I don't see a reason to write GW outside of LTC.

Not even sure there is a reason to write GNW LTC Ray?

Heck, Mass Mutual is same premium or cheaper than GNW LTC today.

 

[Tahoe Ray]

Not even sure there is a reason to write GNW LTC Ray?

Heck, Mass Mutual is same premium or cheaper than GNW LTC today.

Underwriting? A lot fewer players in LTC than in the life market so that's why I mentioned it.

 

[WinoBlues]

Underwriting? A lot fewer players in LTC than in the life market so that's why I mentioned it.

Especially in The People's Republic of Kalifornia

 

[scagnt83]

So no one who ever bought a guaranteed term policy from a company that failed, lost their policy.

If I am investing large amounts of money in a life insurance company, like an annuity or non-guaranteed UL product, I'll want to be much more diligent than if I am buying a 20 or 30 guaranteed term policy.

My view is that if I am looking at a minor difference in price between an A- or an A+ carrier, I would probably go with the A+ carrier.

On the other hand, I remember Confederation Life, and how the A.M. Best ratings fell weekly before the Canadian regulators stepped in and closed down the operation.

But either way, as a 20 or 30 year term buyer, I should not be too worried that the product won't be in force later, due to a life company failure.

SGA coverage has its limits. And while most books of life business are bought, that does not always happen and is not guaranteed to happen.

I actually do agree with you that you should not be too worried about the product being in-force still with any of the A rated carriers. However, if the client cares about convertability options, then the ratings and financial strength start to matter a whole lot more.

 

[Robert Barney]

And while most books of life business are bought, that does not always happen

Please identify a case where it did not happen.

 

[scagnt83]

Please identify a case where it did not happen.

Read up on the SGA receivership process. Since 1983 SGA funds have paid out over $5billion in claims to ensure that policyholders receive their benefits... up to the SGA cap at least (around $300k in most states).

Now they have helped to Guarantee over $21billion. That means out of $21billion in receivership claims, only $5billion was not bought by another insurer and was fully liquidated and paid by SGA funds.


Part of that $5billion came from Executive Life Insurance in the early 90s. According to the NOLHGA most of their book of business was acquired by Aurora Life... but not all of it was acquired.


So as I originally said, MOST of the time that happens. But not all of the time. And it is by no means guaranteed to happen.

 

[Robert Barney]

Part of that $5billion came from Executive Life Insurance in the early 90s. According to the NOLHGA most of their book of business was acquired by Aurora Life... but not all of it was acquired.

You speak in generalities.

What part of the book was NOT acquired?

Were the term life insurance policies not acquired?

I contend there has not been a policy holder in the country who has lost their term life insurance contract due to a life company failure. Term life "books of business" are attractive, profitable, and not the reason why life insurance companies get into financial trouble. None of that will change moving forward.

Care to know why?

 

[scagnt83]

You speak in generalities.

What part of the book was NOT acquired?

Were the term life insurance policies not acquired?

I contend there has not been a policy holder in the country who has lost their term life insurance contract due to a life company failure. Term life "books of business" are attractive, profitable, and not the reason why life insurance companies get into financial trouble. None of that will change moving forward.

Care to know why?

I never said that they lost their policy. I said that SGA funds were used and the policies were not acquired by a different carrier. There is a difference. Actual licensed insurance agents know the difference.

If you want someone to spend a day digging into every single carrier that has gone through the liquidation process then I suggest you hire them. I charge $200 per hour if you would like to utilize my services.

If you want to argue with someone then I suggest you find someone else to engage with. You made a statement that was not true... and I will correct you every time you attempt to portray yourself as an expert and make false statements. But I have no reason to fight with you or prove anything to you.