Life Insurance Has an Inclusivity Problem

Link: https://www.thinkadvisor.com/2022/06/10/life-insurance-has-an-inclusivity-problem/

Excerpt:

Modern underwriting approaches and distribution methods, often spearheaded by insurtech companies, unlock unique, data-driven insights that enable the industry to understand who they’re serving well — and where they fall short.

The industry can use these insights to adopt a more personalized, progressive approach to product design, underwriting, and distribution to reach specific populations with coverage options and pricing that suits their unique needs.

For the LGBTQ+ community, historical rules and underwriting approaches around mental health could make coverage unattainable or unaffordable.

For example, while our survey didn’t ask respondents about treatment for mental health, the cost of health care in general was a primary concern for nearly 70% of respondents.

A study published in the National Library of Medicine found that LGBTQ+ people used mental health services at 2.5 times higher rates than heterosexual or cisgender individuals.

Additionally, studies have found that they are two and a half times more likely to experience depression, anxiety, and substance abuse — items that are all considered in the underwriting process for life insurance.

Since many in the LGBTQ+ community struggle with mental health concerns, we must find better ways to understand the situation and evaluate the risk holistically.

Author(s): Jeremy Bill

Publication Date: 10 Jun 2022

Publication Site: Think Advisor

Sanders’ Social Security Bill Would Extend Payroll Tax to Capital Gains for High Earners

Link:https://www.thinkadvisor.com/2022/06/10/bernie-sanders-new-social-security-bill-would-extend-payroll-tax-to-capital-gains-for-high-earners/

Excerpt:

Sen. Bernie Sanders, I-Vt., and Rep. Peter DeFazio, D-Ore., introduced Thursday the Social Security Expansion Act (SSEA), which would, among other measures, boost benefits, adopt the Consumer Price Index for the Elderly, or CPI-E, for benefit increases, and subject all income above $250,000 — including capital gains — to the Social Security payroll tax.

Dan Adcock, Director of Government Relations and Policy at the National Committee to Preserve Social Security and Medicare, told ThinkAdvisor Friday in an email that the DeFazio-Sanders bill, like the Social Security 2100: A Sacred Trust, introduced by Rep. John Larson, D-Conn., “both extend solvency and improve benefits.”

The Larson bill, however, “is consistent with President Biden’s pledge not to raise taxes on Americans earning less than $400,000 per year,” Adcock said, while “the Sanders-DeFazio bill is not.”

A Sacred Trust adopts the consumer price index for the elderly as the basis of the annual cost-of-living adjustment (COLA) and applies the payroll tax to annual wages above $400,000.

Author(s): Melanie Waddell

Publication Date: 10 June 2022

Publication Site: Think Advisor

Why Social Security Looks ‘Relatively Good’ — for Now

Link: https://www.thinkadvisor.com/2022/06/03/social-security-looks-relatively-good-now-long-term-outlook-still-ugly-ssa-actuary/

Graphic:

Excerpt:

In a post-mortem of the Social Security Trust Fund report released Thursday, the Bipartisan Policy Center hosted a webinar featuring speaker Steve Goss, chief actuary of the Social Security Administration. Goss looked beyond the headlines stating that the Old-Age and Survivors Insurance will run out in 2034 (a slight improvement from last year’s forecasted demise of 2033) and that the Disability Insurance fund is now solvent for another 75 years.

“We’re in a little better shape [than 2021] because the economy has come roaring back to such a wonderful extent,” Goss said.

He also pointed out that labor demand has had a “remarkable rebound.” For example, it took 10 years for the job market to come back after the 2008 Great Recession. However, the 2020 recession, which was “very deep and very abrupt,” has also reversed just as quickly and in the first quarter of 2022, “we are virtually back to the high level that we had just before the start of the recession.”

Author(s): Ginger Szala

Publication Date: 3 June 2022

Publication Site: Think Advisor

Fed Hikes Rates 75 Basis Points; Powell Says 75 or 50 Likely in July

Link: https://www.thinkadvisor.com/2022/06/15/fed-hikes-rates-75-bps-intensifying-inflation-fight/

Graphic:

Excerpt:

The Federal Reserve raised interest rates by 75 basis points — the biggest increase since 1994 — and Chair Jerome Powell said officials could move by that much again next month or make a smaller half-point increase to get inflation under control.

Slammed by critics for not anticipating the fastest price gains in four decades and then for being too slow to respond to them, Chairman Jerome Powell and colleagues on Wednesday intensified their effort to cool prices by lifting the target range for the federal funds rate to 1.5% to 1.75%.

“I do not expect moves of this size to be common,” he said at a press conference in Washington after the decision, referring to the larger increase. “Either a 50 basis point or a 75 basis-point increase seems most likely at our next meeting. We will, however, make our decisions meeting by meeting.”

Author(s): Craig Torres

Publication Date: 15 June 2022

Publication Site: Think Advisor

5 Ways the New Stock Market Rollercoaster Could Affect Life Insurers

Link: https://www.thinkadvisor.com/2022/06/16/5-ways-the-new-stock-market-rollercoaster-could-affect-life-insurers/

Excerpt:

1. Clients could swarm on life and annuity products with benefits guarantees like ants on a candy bar that fell under the picnic table.

Sales of products such as non-variable indexed annuities and non-variable indexed universal life insurance policies soar, as clients flocks to arrangements that can protect them against further drops in stock prices but help them share in gains if and when prices go back up.

Author(s): Allison Bell

Publication Date: 16 June 2022

Publication Site: Think Advisor

South Carolina Withdraws From Interstate Insurance Compact

Link: https://www.thinkadvisor.com/2022/06/13/south-carolina-withdraws-from-interstate-insurance-compact/

Excerpt:

South Carolina — one of the leaders in the effort to create the Interstate Insurance Product Regulation Compact — has withdrawn from the compact because of a conflict over long-term care insurance rate increase application reviews.

Members of the Interstate Insurance Product Regulation Commission, the body that oversees the compact, voted in December 2021 to keep a rule that lets the compact review and approve requests for LTCI rate increases under 15%.

The rule conflicts with a new South Carolina law that requires the director of the South Carolina Department of Insurance or a director designee to review and rule on all LTCI rate filings.

Author(s): Allison Bell

Publication Date: 13 June 2022

Publication Site: Think Advisor

15 States Where Older Adults Are Going Back to Work

Link: https://www.thinkadvisor.com/2022/06/09/15-states-where-older-adults-are-going-back-to-work/

Excerpt:

Two years after the pandemic hobbled the U.S. economy, pushing up unemployment, Americans are returning to work, including many adults 65 and older, according to new research from MagnifyMoney.

In late April and early May this year, 21.9% of Americans 65 and older were working, up from 19.5% during the same period in 2020. At the same time, the share of U.S. adults who reported that they were retired rose to 17.4% in April and May 2022 from 14.9% two years earlier.

MagnifyMoney found that 25.6% of working older Americans are self-employed, more than triple the rate among working Americans 25 to 39.

The number of working older Americans varies dramatically across the country. In North Dakota, for example, the rate dropped by 11 percentage points over the two-year period, and in Wisconsin by 8.3 points. In contrast, several states saw double-digit increases in employed Americans 65 and older during that period.

Author(s): Michael S. Fischer

Publication Date: 9 Jun 2022

Publication Site: Think Advisor

Top 10 Medicare Bills Introduced in 2022

Link: https://www.thinkadvisor.com/2022/04/28/top-10-medicare-bills-introduced-in-2022/

Excerpt:

Here’s a look at the top-performing Medicare bills introduced since Jan. 1.

We searched Congress.gov for new Medicare bills, then ranked the bills based on co-sponsorship bipartisanship and numbers.

Some of these bills could pass on their own. Others could surface as provisions in much larger bills, such as a Ukraine aid bill or a COVID-19 pandemic response funding bill.

What It Means

These measures seem to have the legislative mojo to go places.

Each sponsor has managed to overcome the current hostility between Republicans and Democrats and persuade at least one member of the opposite party to sign on as a co-sponsor.

Author(s): Allison Bell

Publication Date: 28 April 2022

Publication Site: Think Advisor

Life Application Activity Cools Again

Link: https://www.thinkadvisor.com/2022/05/10/life-application-activity-cools-again/

Excerpt:

Policygenius, a life insurance web broker, uses its term life pricing information to provide monthly term life price index reports.

The company bases the index on prices for coverage with a 20-year-level premium term.

The lowest price shown is for coverage for a 25-year-old female nonsmoker who wants $250,000 in death benefits; The highest price is for a 55-year-old male smoker who wants $1 million in death benefits.

Policygenius figures suggest rising premiums may not be causing life application friction.

This month, the lowest price in the tables fell slightly, to $14.21, from $14.25 last month.

Author(s): Allison Bell

Publication Date: 10 May 2022

Publication Site: Think Advisor

COVID-19 Deaths Cause More Than $700M in Q1 Claims

Link: https://www.thinkadvisor.com/2022/05/09/covid-19-deaths-continue-to-hit-life-insurers-hard/

Excerpt:

COVID-19 returned to killing older Americans at a much higher rate than younger Americans in the first quarter, and that helped to hold down life insurers’ death claims.

The pandemic killed about 155,000 U.S. residents in the latest quarter. That was up from 127,000 in the fourth quarter of 2021, but down from 191,000 in the first quarter of 2021, according to statistics from the U.S. Centers for Disease Control and Prevention and other public and private sources.

Some life insurers and reinsurers that posted earnings last week skipped COVID-19 mortality details.

…..

MetLife: $230 million in world group life claims this quarter, down from $280 million a year earlier.

Hartford Financial: $96 million before taxes this quarter, down from $185 million a year earlier.

Unum: 1,400 deaths at an average of $55,000, or $77 million, down from 1,725 deaths at an average of $65,000, or $112 million, a year earlier.

Lincoln Financial: $53 million in group life claim claims and $18 million in group disability claims this quarter, down from $83 million in group life claims and $7 million in group disability claims a year earlier.

Voya: $35 million in group life claims this quarter, up from $29 million a year earlier.

Author(s): Allison Bell

Publication Date: 9 May 2022

Publication Site: Think Advisor

COVID-19 Deaths Cause More Than $700M in Q1 Claims

Link: https://www.thinkadvisor.com/2022/05/09/covid-19-deaths-continue-to-hit-life-insurers-hard/

Excerpt:

Reinsurance Group of America — a Chesterfield, Missouri-based reinsurer — said its U.S. COVID-19 individual life claims fell to $260 million in the latest quarter, from $340 million a year earlier.

“Our U.S. individual mortality results are very consistent with what we are seeing in the general population this quarter,” Jonathan Porter, RGA’s global chief risk officer, said Friday, during a conference call with securities analysts. “We saw a reduction in our claim cost per 10,000 general population deaths as compared to the third quarter and fourth quarter of 2021. This improvement, we believe, is in part due to the lower proportion of deaths in working ages.”

Here’s what happened to U.S. COVID-19 claim statistics at some other life insurers, including some that are known mainly for group life:

MetLife: $230 million in world group life claims this quarter, down from $280 million a year earlier.

Hartford Financial: $96 million before taxes this quarter, down from $185 million a year earlier.

Unum: 1,400 deaths at an average of $55,000, or $77 million, down from 1,725 deaths at an average of $65,000, or $112 million, a year earlier.

Lincoln Financial: $53 million in group life claim claims and $18 million in group disability claims this quarter, down from $83 million in group life claims and $7 million in group disability claims a year earlier.

Voya: $35 million in group life claims this quarter, up from $29 million a year earlier.

Primerica: $16 million in life claims this quarter, down from $21 million a year earlier.

Author(s): Allison Bell

Publication Date: 9 May 2022

Publication Site: Think Advisor

Few Retirees Leave Workforce Gradually: EBRI

Link: https://www.thinkadvisor.com/2022/05/02/few-retirees-leave-workforce-gradually-ebri/

Excerpt:

The 32nd EBRI survey found 7 in 10 workers were at least somewhat confident they would live comfortably in retirement.

Half of workers plan to retire at 65 or later, while current retirees left the workforce at a median age of 62.

Large shares of workers say they don’t understand managed accounts, ESG investments or target date funds.

Author(s): Ginger Szala

Publication Date: 2 May 2022

Publication Site: Think Advisor