Not likely, but today ING Reliastar said they we discontinuing sales of the 25 and 30 year term products effective at the end of July. Probably the biggest impact this will have will be all of the mega agencies that have glommed on to ING because of the juicy contracts and bonuses offered. This isn’t exactly stunning news after Genworth and AXA Equitable dropped their 30 year products in the recent past.
What is shaking out with long term life insurance products and no lapse guarantee universal life insurance products is that companies that jumped in just to compete are finding out that, at least for their companies and their company’s need to carry reserves for those products, it’s not working out. Keep an eye on this. While I wouldn’t jump at a chance to buy ING Reliastar, if other companies pop up and say they are going to discontinue 30 year term or like Banner the other day, raise the rate on their no lapse guarantee UL, understand they have decided they aren’t making money it which means if you buy it before it goes away you’ve got a great deal.
So, what is the future of these term products? Will you even be able to buy a 30 year term life insurance policy or a lifetime guarantee no lapse universal life down the road? I took off my rose colored glasses and took a good hard look at this and it is my opinion that the products are too valuable to be completely bagged by the industry. I believe you will see rate changes from the stronger companies so they can continue to offer and stay fiscally sound. Weaker companies will throw it out with the dish water. Companies like Genworth and West Coast Life and ING all have a track record of bold statements, whether about products or underwriting, with short lived follow through.
Bottom line. We are in an adjustment period, no question, that probably should have happened a few years ago but I think at that time companies were just trying to stabilize after 2008/2009 and needed cash from sales. It wasn’t the right time to bag some of their best selling products. So, let’s get on with it and see what shakes. I think you will see a stronger, more competitive life insurance market going forward. If you have any questions or are feeling panicked by any of this, call or email me directly. And if you think longer term insurance is a need you may have, don’t think too long. What doesn’t disappear will most certainly cost more if you wait. My name is Ed Hinerman. Let’s talk.
My 20 years of experience give me the knowledge and leverage to find reasonably-priced life insurance for people who have been declined or are paying more than they need to.
I swear I am not writing about whole life, but have you ever priced term riders to small WL contracts versus separate term policies from competitive companies? Most of the big WL companies only go out 10 years or so on term riders, but some smaller ones like Illinois Life will go 20, and I think Ameritas has one WL product that actually offers a 30 year term rider. It’s just a thought. These companies might not even want to write huge term riders to small WL policies.