Insurable Interest Canadian Insurance Blog

New York has entered into a consent order with MetLife Insurance Company, under which the insurer will pay a penalty of $19.75 million for failing to properly locate and pay benefits to thousands of New York insureds and beneficiaries. As part of the consent order, MetLife will also pay retroactive benefits to policyholders in New York State and elsewhere totaling more than $189 million. The insurer has already paid $123 million of the approximately $189 million to consumers whose group annuity benefits had been lost or delayed, and will pay the remainder going forward. “Today’s action is a victory for policyholders, whose benefits were not paid due to MetLife’s failures, with the Department taking the necessary action to protect consumers,” Superintendent Maria Vullo said. “The restitution and other corrective actions mandated under this consent order will ensure that consumers are paid the benefits to which they are entitled and that an appropriate fine is paid and procedures put in place to prevent this from happening again. The Department appreciates MetLife’s cooperation in self-reporting its claims issues, resolving these matters, and committing to full restitution to all eligible beneficiaries.” In addition to the benefits that have already been paid during the...

By Troy Korsgaden Gone are the days of carriers leading the entire purchasing cycle of insurance products and financial services. In today’s environment, it’s the customer who is in control. To remain competitive, advisors must become the local gateway to every potential option. This is a positive change for our industry. Instead of running our businesses in a way that focuses on our needs, we are shifting our focus to customers. And that’s the way it should be. Traditionally, customers buying insurance products and financial services have had little or no voice in the purchasing cycle. Up until now, this approach has enabled carriers to retain business, despite the plethora of offerings in the marketplace. Some well-established and well-run agencies have offered differentiators, but nothing radical enough to flip the industry upside down. These agencies have enjoyed increased business as they’ve added a few other lines of insurance, but their dream of representing all products and services in their clients’ households has not materialized. The pricing might be great in one area, but not in another. Price seems to have been the only real driver, other than local or high-touch service. It was never enough to win the day —...

According to a new LIMRA Secure Retirement Institute (LIMRA SRI) study, 79 percent of American consumers are concerned about financial fraud with 36 percent saying they were very concerned. The study found one quarter of Americans report they have been a victim of financial fraud with 13 percent victimized in the past two years. The report, Financial Fraud and Retirement Accounts: An Opportunity to Engage, Educate and Build Trust, noticed that levels of concern vary significantly across the different types of financial products. Consumers tend to worry about “high-touch” products, such as credit cards and bank accounts, more than they worry about long-term savings accounts, like workplace retirement plans, IRAs and annuities. The study finds 83 percent of American cardholders say they are concerned about credit card fraud, while just 53 percent of retirement plan savers are concerned about their workplace retirement plan. “While it may be natural for consumers to worry more about products they use more often, recent LIMRA research confirms that the incidence of fraud is increasing among individual life insurance contracts, individual annuities and DC retirement plans(1). This evolution is driven not only by the increased appeal of financial accounts that hold larger pools of money,...

A couple of recent studies have thrown up some interesting findings regarding the life insurance situations of many Canadians. One such study, carried out by the Life Insurance and Market Research Association, found that although 61% of Canadians held a life insurance of some type, only 38% held their own, individual life insurance policy. This arrangement can carry a number of risks, such as: If you rely too heavily on the life insurance provided by your employer, you are vulnerable to changes in circumstances that may occur. For example, if your employer changes or cancels the policy you will lost protection. Equally, if you lose your job for any reason, your insurance coverage will be cancelled too. The maximum life coverage offered in lots of group plans is only two times annual earnings, whereas individual policies can offer higher ratios. If your group plan offers critical illness coverage, the amount is generally quite low. Generally speaking, when you retire at the age of 65, your group insurance plan will cease whereas it is clearly preferable to continue life insurance coverage after this age. Trying to change your group life insurance plan to an individual one can be expensive; therefore, the...

New SMA Blog by Karen Pauli, Principal, Strategy Meets Action Boston, MA (Jan. 24, 2019) – Given that this blog is coming out in January, a baseball reference in the title might seem a wee bit out-of-season. Should it be a football reference? Perhaps. But SMA’s recent report, 2019 Strategic Initiatives: P&C Commercial Lines, is… Read more » The post 2019 Commercial Lines Strategies: Stepping Up to The Plate appeared first on Insurance-Canada.ca.

Much like how you wouldn’t share your toothbrush with someone else, the same sentiment should be applied to sensitive information like online passwords, personal identification numbers (PIN), or credit card details. And as there are reportedly more than 2.5 billion active users worldwide on social media sites like Twitter, Instagram, Facebook, and Pinterest, now more than ever, it’s important to know how to prevent information or identity theft. January 28 is International Data Privacy Day, and its purpose is to raise awareness regarding the best ways in which businesses and consumers can protect their personal information online. One of the pitfalls to social networking Chances are, over the last decade, you’ve all moved over to storing most of your personal information online. From mobile banking services and online shopping carts, to email services to cloud storage, to GPS and location tracking to social media accounts, each time we download a new app or program onto our devices or sign up for a new account, we are both consciously and unconsciously compromising important personal data. Social media-based information theft and privacy hacks are on the rise with each new account, like, and post. And since it’s so easy – not to...

Last week, Canada’s biggest bank, RBC, cut its five-year fixed rate by 15 basis points. This gave customers the option to lock in their mortgage rate at 3.74 per cent, for a five-year term. And surely enough, TD Bank and BMO Bank of Montreal followed suit and cut their five-year fixed rates to the same level. Currently, CIBC is asking all customers to call in for more details on its five-year fixed rate, and Scotiabank is not showing the same 15-basis-point cut. The move by some of Canada’s commercial banks is overdue. Unlike variable-rate loans that are affected by the Bank of Canada’s benchmark rate, fixed rates are tied to the bond market, and bond yields have been sinking over the last two months. The yield for the Government of Canada benchmark five-year bond fell from a high of 2.48 per cent last October to a low of 1.76 per cent on January 3. At the time of writing this article, the bond yield has recovered slightly but still remains lower than two per cent. This means it’s cheaper for commercial banks to borrow money at a fixed rate and, therefore, they can pass down those interest rate savings to...

Protective Life Insurance Co. and Protective Life & Annuity Insurance Co., will acquire via reinsurance substantially all of Great-West Life & Annuity Insurance Company’s individual life insurance and annuity business. The companies are under the umbrella of Protective Life Corp., a wholly owned U.S. subsidiary of Dai-ichi Life Holdings. The business to be transferred, which has been marketed under the Great-West Financial brand, includes bank-owned and corporate-owned life insurance, single premium life insurance, individual annuities, and a portion of Great-West’s closed block life insurance and annuities. GWL&A will retain a block of participating policies, which will be administered by Protective. The transaction represents an estimated capital investment by Protective of approximately $1.2 billion, subject to adjustment, and will be the largest acquisition in company history. It will also mark Protective’s entrance into the executive benefits market. “This business aligns well with our long-term plans for growth and scale. The life and annuity business has been a cornerstone of Protective throughout our history and will continue to be an area of future growth for the company,” said Richard J. Bielen, President and Chief Executive Officer, Protective. “Together, Great-West and Protective bring strength and stability to this transaction with a shared focus...

Pacific Life today announced the addition of PL Promise GUL1, a new, no lapse guarantee universal life insurance (GUL) product to its PL Promise line. Designed to help address the life insurance needs of the underinsured broad market, the new life insurance policy provides lifetime death benefit protection with predictable premiums, longer guaranteed coverage periods, and living benefit options2 to help meet evolving financial needs. The policy features: Accessible $25K minimum face amount Consumer protection so premiums paid one month early or late will have no adverse impact to intended guarantee – avoids unnecessary catch-up premiums.3,4 Predictable and convenient fluidless underwriting for up to $1 million in coverage for clients age 50–69 Enhanced cash surrender value rider at no additional cost.5 “In the PL Promise product line, we have developed simpler products with lower minimum coverage amounts and competitive pricing to make them more accessible to the broad market,” said Brynn Thabet, assistant vice president of product management in the Lynchburg life insurance division of Pacific Life. “The PL Promise expansion offers peace of mind for those looking to protect their families for longer than term life insurance might cover. Plus, our consistent and predictable fluidless underwriting has clear qualification...