These products are just the “next thing.”
May 15, 2023 by Sheryl J. Moore
No offense to ANY insurance company, but I don’t think that structured life insurance products (think the equivalent of a “RILA,” on the life side) are the “next big thing.”
I agree with Tim Pfeifer in Life Annuity Specialist’s Why Structured Life Won’t Keep Up With Structured Annuities. They are just the “next thing.”
Structured annuities rose in sales quickly, partially because indexed annuity rates were abysmal. The structured annuity caps were comparatively better.
Life insurance rates generally are more attractive than annuity rates because they are not just a spread product. The insurer has other ways of making a profit, i.e. insurance charges.
And- indexed life can illustrate just as favorably as a structured life product, but with a zero percent floor.
So while I am excited about the product innovation in this relatively new line of business, I don’t think it will take off quite as quickly, nor as robustly, as structured annuities.
Do you sell VUL? What are your thoughts on this line of business? – sjm