Equitable Life & Casuality Question

[jbage007]

If that is your only reason for replacement, I feel sorry for your clients. You certainly do not have their best interests at heart but I guess everyone has to make a living someway.

You seem to be suggesting that the financial stability of the insurance company should not be an overriding concern to my clients.

The fact of the matter is when you have an insurance company that cannot even manage its own finances in a manner that enables it to receive an A level rating from AM Best, it is my own personal ethos that prohibits me from recommending a financially inferior company to my clients because of the fiduciary approach I take with my clients.

In that regard, you and I seem to be on polar opposite ends of this discussion. In your view, the financial stability of an insurance company seems to be of little to no concern, while in my view the financial stability and reputation of an insurance company is a major consideration in my effort to ensure the highest quality service and financial stability for my clients.

To that end, the cavalier, off-the-cuff comment you made about me could just as easily apply to you because that is precisely the way I feel about agents who routinely and regularly recommend lower rated companies to their clients, a key indicator noting the complete absence of a fiduciary obligation to your clients.

 

[G.Gordon]

JB,

The reason we don't get our panties in a knot about B verses A in the world of a Medicare supplement is because with Medicare Supplements all claims are paid at the same level and the service from A or B rated companies is equal.

I have seen A rated carriers be one of the biggest PITA's to deal with than some of the lowest B rated carriers in regard to Supps.

 

[sman]

Don't address it at all. I'll do it for you when I run into all of your clients that you have with a B rated carrier. I will show them that I use only A and A+ rated carriers that they know and trust. Hope that helps you sleep better knowing that you don't have to worry about bringing the issue up with your clients.

That's funny because I would love to come behind someone who sells an overpriced Med Supp based solely on an AM Best rating. Once I explain how regulated Med Supps are I'm willing to bet this person would become a former client of that particular agent.

 

[bpenn9]

You seem to be suggesting that the financial stability of the insurance company should not be an overriding concern to my clients.

The fact of the matter is when you have an insurance company that cannot even manage its own finances in a manner that enables it to receive an A level rating from AM Best, it is my own personal ethos that prohibits me from recommending a financially inferior company to my clients because of the fiduciary approach I take with my clients.

In that regard, you and I seem to be on polar opposite ends of this discussion. In your view, the financial stability of an insurance company seems to be of little to no concern, while in my view the financial stability and reputation of an insurance company is a major consideration in my effort to ensure the highest quality service and financial stability for my clients.

To that end, the cavalier, off-the-cuff comment you made about me could just as easily apply to you because that is precisely the way I feel about agents who routinely and regularly recommend lower rated companies to their clients, a key indicator noting the complete absence of a fiduciary obligation to your clients.

Do you recommend MOO cause they are an "A" rated carrier?

 

[BeeSelective]

JB,

The reason we don't get our panties in a knot about B verses A in the world of a Medicare supplement is because with Medicare Supplements all claims are paid at the same level and the service from A or B rated companies is equal.

I have seen A rated carriers be one of the biggest PITA's to deal with than some of the lowest B rated carriers in regard to Supps.

I didn't know a vs b measured how easy a company was to deal with.

Kinda like a 5 star rating?

 

[senior-advisor-indiana]

I only offer Aflac because of their A+ rating.....

 

[somarco]

AM Best ratings mean nothing when it comes to primarily health insurance operations. Best applies the same standards (reserves, IBNR, etc) for life insurance carriers that they use for health carriers.

Any agent worth their salt knows this (or should).

Health carriers almost always come up with a lower Best rating than life carriers.

In 39 years in this industry I have had more A and A+ carriers shot out from under me than B carriers.

Rouse knows exactly what I am talking about.

AIG, Mutual Benefit, Executive Life, Baldwin United ....

Even when they don't go TU there are plenty of big names in the health insurance game that are no more.

MONY, Mutual of Omaha (U65 health insurance), Penn Mutual, UnionMutual, Provident Mutual .......

 

[rousemark]

You seem to be suggesting that the financial stability of the insurance company should not be an overriding concern to my clients.

The fact of the matter is when you have an insurance company that cannot even manage its own finances in a manner that enables it to receive an A level rating from AM Best, it is my own personal ethos that prohibits me from recommending a financially inferior company to my clients because of the fiduciary approach I take with my clients.

In that regard, you and I seem to be on polar opposite ends of this discussion. In your view, the financial stability of an insurance company seems to be of little to no concern, while in my view the financial stability and reputation of an insurance company is a major consideration in my effort to ensure the highest quality service and financial stability for my clients.

To that end, the cavalier, off-the-cuff comment you made about me could just as easily apply to you because that is precisely the way I feel about agents who routinely and regularly recommend lower rated companies to their clients, a key indicator noting the complete absence of a fiduciary obligation to your clients.

If it means all that much why not write only A+ companies? Why put you clients at risk with an A or A- rated company? As for what I recommend, you have no idea as I have not made any statement to that effect. As far as cavalier comments go, you were the one that made the smart alec remark about not discussing the B rating with the clients so you could come along and replace the business. But, just so there is no misunderstanding I have and will write companies with B" or B+ rating.. I have even written companies that choose not to pay AM Best for a rating.

If you know anything about the history of our industry, then you know that more consumers have been affected by the collapse of A and A+ companies than B companies. Ever heard of Executive Life or Mutual Benefit? As for service, many of the smaller B+ rated companies give much better service than some of the A+ behemoths.

My personal ethos is to do the best job I can for my clients even if means I have to surrender my ratings snobbery. I treat my clients as I would like to be treated. Both my wife and I have our Medicare Supplement with Equitable so I certainly would not hesitate to propose it to someone else that wants a comapny that has excellent policyholder service, good rates, stable rate history and excellent claims service. If you would come along and replace one of their policies with another company with a higher rate just because of a subjective rating, then your personal ethos is not as strong as you think and your ethics even less.

 

[yorkriver1]

If there is any parallel between what happened with A rated carriers like Executive Life and the mortgage securities ratings scandal, then ratings are, well, subjective at best. I am not saying that AM Best is like the culprits in the mortgage CDO troubles, but, ratings are not always the key to avoiding a financial failure.
"Economist Joseph Stiglitz considered "the rating agencies as one of the key culprits... They were the party that performed the alchemy that converted the securities from F-rated to A-rated. The banks could not have done what they did without the complicity of the rating agencies."[43] In their book on the crisis — All the Devils Are Here — journalists Bethany McLean and Joe Nocera criticized rating agencies for continuing "to slap their triple-A [ratings]s on subprime securities even as the underwriting deteriorated -- and as the housing boom turned into an outright bubble" in 2005, 2006, 2007.[1]"
I had a P&C client back in the day who crowed about how my life quote could never compete with his 14% return on his Executive Life policy. Mic drop.

 

[somarco]

At least some of the A rated carriers are no longer with us because of over-promising high rates of return during the Jimmy Carter days of 18% interest rates. AIG got into trouble for over-leveraging.

The mutual carriers, once the stalwarts in the industry, suddenly could not compete when interest sensitive plans hit the market. Many de-mutualized so they could be acquired while others did so in an attempt to merge with companies of a similar size.