This report features charts and information on 28 participating (dividend-paying) contracts. The 4 parts of this excerpt are from the newest whole life edition of the Full Disclosure software series. As in past reports, there are sections covering current and guaranteed illustrated values, the industry’s only actual historical performance analysis, and a narrative detailing what each policy’s fundamental design objectives are.
This year we have added a new scenario featuring maximum income generation, similar to that we show for universal and variable life products. The parameters of this new section basically feature a policy that is heavily funded and switches to a paid-up dividend option at retirement age, thereby producing a maximum income stream.
Trends we are seeing in the whole life market include the rapid adoption of products that utilize the new 2001 mortality table and products designed for niche markets. Of the currently illustrated policies, 18 are priced using the new table, an increase from only 7 last year. This is as the survey gained a policy from the previous excerpt and one company, USAA Life, withdrew from the market. This pricing migration is important in that it allows insurers to lower annual premiums and/or increase illustrated performance relative to those utilizing the 1980 table with higher costs and shorter maximum age.
Meanwhile, niche products include those with high early cash values and those that are entirely guaranteed non-participating plans. These policies must represent the ultimate in safety.