{"id":18414,"date":"2020-05-12T11:16:12","date_gmt":"2020-05-12T15:16:12","guid":{"rendered":"https:\/\/insurancenewsnet.com\/?post_type=innarticle&p=5466903"},"modified":"2020-05-12T11:16:12","modified_gmt":"2020-05-12T15:16:12","slug":"insurers-wrestling-with-distribution-profitability-concerns-survey","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2020\/05\/12\/insurers-wrestling-with-distribution-profitability-concerns-survey\/","title":{"rendered":"Insurers Wrestling With Distribution, Profitability Concerns: Survey"},"content":{"rendered":"
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Courtesy of LIMRA<\/strong><\/p>\n

Insurers have serious concerns about distribution and profitability in the new COVID-19 world, a new survey finds.<\/p>\n

LIMRA worked with the Society of Actuaries and Oliver Wyman to conduct a series of short surveys on the COVID-19 pandemic and its potential effects on the insurance industry.<\/p>\n

The COVID-19 pandemic has resulted in social-distancing practices and volatile market conditions that have caused disruptions in many life insurance companies\u2019 processes.<\/p>\n

About 90% of the companies rated distribution\/social distancing and pricing\/new business profitability (89%) as a concern and 77% listed in-force profitability.<\/p>\n

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\u201cCompanies have had to be nimble in making adjustments where needed to their product rates and pricing,\u201d said Marianne Purushotham, research actuary, LIMRA, who co-authored the survey.<\/p>\n

Depending on the product, various factors contribute to companies\u2019 current pricing challenges:
\u2022 Increased cost of hedging and declining government bond rates were the biggest concerns for variable annuity writers;
\u2022 Declining government bond rates and rising credit spreads\/default risk topped the concerns for fixed and\/or fixed indexed annuity writers;
\u2022 Underwriting uncertainty, declining government bond rates, and increased\/uncertain mortality\/morbidity were the primary concerns for term life writers; and
\u2022 Declining government bond rates and underwriting uncertainty presented the biggest challenges for permanent life insurers.<\/p>\n

To manage these new economic challenges companies have taken various steps:
\u2022 58% of respondents have increased the frequency of reviews for pricing\/caps\/crediting rates;
\u2022 Two-thirds of respondents have increased monitoring of new business volumes and almost half (47%) have increased their monitoring of new business profitability;
\u2022 About half of respondents have adjusted non-guaranteed elements and about 30% have adjusted guarantees;
\u2022 Almost 6 in 10 respondents have restricted life and health products for recent travel to specific countries; and
\u2022 About one-third have updated their long-term interest rate assumptions.<\/p>\n

There have also been changes in underwriting for life insurance products. Two-thirds of respondents have changed their underwriting process to address the lack of access to traditional paramedical testing.<\/p>\n

Of those who have changed, about two-thirds are using attending physician statements in place of fluid requirements, two-thirds are increasing automated\/accelerated underwriting limits, and about one half are using telephone or FaceTime screenings.<\/p>\n

The study results indicate life insurers are adapting to the new economic conditions and physical limitations brought on by the COVID-19 pandemic. These changes will enable companies to continue to provide Americans the protection products they need to secure their financial future.<\/p>\n<\/div>\n

Read the original article at insurancenewsnet.com <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Courtesy of LIMRA Insurers have serious concerns about distribution and profitability in the new COVID-19 world, a new survey finds. LIMRA worked with the Society of Actuaries and Oliver Wyman to conduct a series...<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18414"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=18414"}],"version-history":[{"count":0,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18414\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=18414"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=18414"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=18414"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}