Tim has written a white paper entitled “Modern Variable Annuity Risk Management”, which can be downloaded here. The paper describes the three key risks facing modern variable annuity companies — investment risk, insurance risk, and policyholder behavior risk — and how the Ruark Companies are uniquely positioned to help our clients develop and maintain integrated solutions to these risks. In particular, mortality in the accumulation phase and longevity in the guaranteed living benefit payout phase are large yet under-appreciated risks in the industry that prudently structured (and available!) reinsurance can mitigate. And regular installments of our industry-leading experience studies of policyholder behavior provide the profound and detailed insights that variable annuity companies need to effectively manage this risk. Please contact Tim if you would like to discuss how we can help you implement these solutions for your company.
Jack Marrion’s Index Compendium for February 2012 includes a reference to Ruark Consulting’s recently completed Fixed Indexed Annuity Surrender Study, as follows:
Index Annuity Surrenders Sharply Down
Based on data from carriers representing 80% of industry sales, a new study published by Ruark Consulting (www.ruarkonline.com) finds that surrenders of index annuity contracts declined significantly from 2006 to 2010. Ruark believes this to be due to less competitive alternatives, use of GLWB’s and greater suitability standards. The Ruark study confirms predictions made by Advantage Compendium in 2008 that annuity exchanges would decline due to annuity lifetime benefits and tightened compliance.
Maria Wood has published an article in LifeHealthPro (which I still think of as National Underwriter) entitled “Fixed Indexed Annuity Holders Keep Holding On”. It is another article based on Ruark Consulting’s Fixed Indexed Annuity Surrender Study. It can be viewed at:
Fixed Indexed Annuity Holders Keep Holding On
Linda Koco has published an article in AnnuityNews.com entitled “More Policyholders Keeping Their Indexed Annuities”. It is based on the results from Ruark Consulting’s Fixed Indexed Annuity Surrender Study. It can be viewed at:
More Policyholders Keeping Their Indexed Annuities
SIMSBURY, CT/January 5, 2012 – Ruark Consulting LLC, a Connecticut-based actuarial consulting firm, has completed its 2011 Fixed Indexed Annuity Surrender Study. This ground-breaking study includes unprecedented detail on the impact of various product features on policy persistency, which is invaluable for insurance companies to manage risk and design appropriate products.
Key findings include:
- Persistency rates improved significantly over the timeframe of the study, which was 2006 through 2010.
- Policies with guaranteed living benefits exhibit better persistency than those without such benefits. Living benefits are popular with consumers, with the majority of new purchases including them.
Ruark Consulting is an Event Sponsor at the Equity-Based Insurance Guarantees Conference taking place in Chicago on November 14 & 15, 2011. Tim Paris is the presenter on November 15 of “Policyholder Behavior Trends, Dynamics & Cohorts for VA’s and IA’s”. Stop by and see Tim and his associates. More information on the conference can be found at the SOA website at:
SOA Equity-Based Insurance Guarantees Conference
Tim Paris’ presentation at the SOA Annual Meeting on Managing Longevity and Mortality Risks is available here. Longevity risk is an under-appreciated risk in variable annuity guaranteed living benefits. Tim welcomes comments and discussion.
Tim Paris – Managing Longevity and Mortality Risks
Rich Tucker, Tim Paris and Steve Wright will be attending the 2011 SOA Annual Meeting in Chicago on October 17, 18, and 19. Let us know if you will also be there.
Tim Paris will be a presenter at session 73 – Managing Longevity and Mortality Risks and Their Global Activities. The SOA website does not show Tim’s participation, but we know better.
It’s been a very busy year for the RCL dental consulting practice, culminating in a couple of big events this summer. First, the 2010 version of the Dental PPO Network Study was released, and included the largest group of companies the study has ever had. Since then I’ve been kept hopping reviewing the results with companies that participated – thanks to all of you for your interest! On October 19 I will be giving a webinar for the National Association of Dental Plans that will include some highlights of the study results. If you’re interested in that let me know or visit the NADP web site for more details. Meanwhile, I will soon be turning attention to a pilot study that reviews per member utilization rates across the industry. Those companies that provided the data for that study will be hearing more in the next couple of months.
In a previous article (When to Automate) I suggested eight considerations when one is deciding whether to automate a complicated process to improve both efficiency and accuracy. In this article I will summarize a real-life project where we used automation to achieve those goals. My hope is that you can identify processes in your own company that could similarly benefit from automation.
One of Ruark Consulting’s businesses is the administration of reinsurance treaties between insurance companies. This involves receiving very large tables of data from one company, performing extensive calculations, and creating large tables of data to be sent to the other party. The steps involved in this process are indicative of the issues to be dealt with in any automation process.
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