Sun Life No Longer Selling VA's...

[2insureyou]

Rut-Ro Shaggy...

Sun Life's surprise exit darkens mood of insurance sellers - InvestmentNews

This is the first I've head of this. Admittedly, I've had my head buried in the sand lately with family, studies, and work, but yikes...

 

[Norwayguy]

Rut-Ro Shaggy...

Sun Life's surprise exit darkens mood of insurance sellers - InvestmentNews

This is the first I've head of this. Admittedly, I've had my head buried in the sand lately with family, studies, and work, but yikes...

And John Hancock has exited the market.

 

[shooter]

ING is taking a 1.5 Billion dollar hit the last quarter
on their variable annuity business.
I believe I read this in Business Week.

Shooter

 

[JFBAgent]

ING is taking a 1.5 Billion dollar hit the last quarter
on their variable annuity business.
I believe I read this in Business Week.

Shooter

Yep and they are reassessing the projections and thus charges on life expentancy and payouts on this closed book of business. I would look for an increase in fees for policyholders.

The VA arms race ended in nuclear holocaust for many of these carriers. ING, Sun Life, Genworth, Hancock...all exited or exiting the market (and all dabbling in Indexed products now).

There is a huge negative exposure here for the VA carriers and many are willing to do what they need to shed some of this risk. Look at Hartford sending the exchange letter to existing VA clients without telling brokers and trying to get the clients to switch to a new annuity without telling them they would lose income account values and death benefits.

 

[VolAgent]

There is a huge negative exposure here for the VA carriers and many are willing to do what they need to shed some of this risk. Look at Hartford sending the exchange letter to existing VA clients without telling brokers and trying to get the clients to switch to a new annuity without telling them they would lose income account values and death benefits.

Has this happened before? Doing such a thing would be the equivalent of hiring attorneys to file a class action lawsuit against you.

 

[JFBAgent]

It already did happen. Hartford's actions are being looked at by the regulators. The attorneys are already salivating.

They sent a letter to existing VA policyholders and told the agents later. The clients were told about a "special exchange program" into a new VA that would be better for you. The letter failed to tell Mr. Policyholder that he would lose all of his income/death benefit rider growth if he did take advantage of this special exchange.

 

[VolAgent]

That has to be one of the dumbest things I have ever heard of.

They'll pay out more in attorney fees, penalties and settlements than they saved.

 

[JFBAgent]

You know it...but our understanding of a good idea is worlds apart from a back office guy's version of a good idea.

At 30% commission on lawsuit winnings, only the lawyers will win with this one.

 

[iceco1d]

Some of these insurance companies made a conscious decision not to hedge their living benefit riders. Not sure what they were thinking.