Fitch notes the latest product offering aimed at the longevity risk protection market, the contingent annuity (CA), is generating controversy. “From a ratings perspective,” the agency notes, “we are concerned with the ultimate risk profile of any CA products, pricing adequacy, questions of transparency, and how the product will be reserved for considering the level of capital required under regulatory capital ratios.” To date, U.S. life insurers have been actively selling variable annuities and other lifetime income annuities that protect against the risk of outliving one’s assets. The CA product structures that have been proposed would offer similar lifetime income benefit guarantees but would not require the policyholder to transfer the assets to the insurance company. “Over the near term,” Fitch concludes, “we will be actively monitoring further developments related to the CA market.”
These prospects have some gray hair, and some assets.
The typical enrollee had a monthly out-of-pocket cost of $47 or lower.
The review rules will apply when the U.S. insurer has sensitive information about 1 million or more people.
Sponsored by Cetera Financial Group
Do you know the difference between client experience and customer service? The answer is crucial.
Sponsored by T. Rowe Price Investment Services, Inc.
The “reflation trade” appears real, but risks are still elevated.
Don’t miss crucial news and insights you need to make informed investment advisory decisions. Join ThinkAdvisor.com now!
- Free unlimited access to ThinkAdvisor.com which provides advisors, like you, with comprehensive coverage of the products, services and trends necessary to guide your clients in making critical wealth, health and life decisions.
- Exclusive discounts on ALM and ThinkAdvisor events.
- Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.
Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.