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NFP Securities & TheInsuranceAdvsior.com selected to Manage Trust‑Owned Life Insurance for New York Bankers Association Members
The Nation’s Largest and Most Influential Banking Association takes the Lead in offering Assets‑Under‑Management Services for Life Insurance Trusts
NEW YORK, NY – The New York Bankers Association (NYBA) announced today that NFP Securities, Inc. (NFPSI), THEInsuranceAdvisor.COM (TIA) and one of TIA’s Insurance Banking® Centers were selected to provide comprehensive trust‑owned life insurance (TOLI) management services to their Member Banks. While life insurance trusts had been exempted from recently imposed standards-for-care, the Uniform Prudent Investor Act (UPIA) now requires that trust‑owned life insurance policy holdings be 1) monitored for performance, 2) investigated for suitability, and 3) managed to minimize costs and maximize benefits relative to risk, just like all other investment trusts.
In an effort to comply with the Act, many banks have already hired third-party administrators (TPAs) like Investment Scorecard (f.k.a. Advicon), Resource Insurance Consultants, and TrustBuilder. Now, “NYBA is helping their members go beyond and supplement the monitoring services provided by TPAs to investigate the suitability of existing or newly proposed trust holdings and manage all trust holdings in a manner that demonstrably minimizes expenses and maximizes benefits relative to risk,” according to Michael P. Smith, President and CEO of New York Bankers Association.
“While our members have been approached by many other providers, NFPSI and TIA were selected because they bring the whole turn‑key package; they can work with any TPA, they bring empirical product research, and their commitment to independent distribution altogether means our member banks won’t hear some sales pitch for some particular product,” adds Mike. “Independent, empirical research is the key to this market,” says Barry D. Flagg, inventor and founder of THEInsuranceAdvisor.COM (TIA).
With research, trustees can independently verify rates and terms of both current trust holdings and any alternative trust holdings, which can thus be managed to minimize costs and maximize benefits to their clients. “When banks bring new value to their clients, they can charge an assets‑under‑management fee just like they do in other investment trusts,” says Flagg. “We work with many, many banks, and see THEInsuranceAdvisor.COM (TIA) as one of the most exciting tools for demonstrating the alignment of our interests in working with banks,” adds Alec Herring, Director of Strategic Alliances for NFPSI.
While the banking community has been concerned with compliance issues surrounding the Prudent Investor Act and OCC Regulations 9 for some years now, this decision by NYBA is the first step towards banks managing trust‑owned life insurance (TOLI) for a fee just like other investments. Michael Smith goes on to say “When I saw the support services coming together that gives our Member Banks ready and scalable access to information about current policy holdings, and ready and scalable access to product research, I knew this was an opportunity to support our banks in managing TOLI the same way they hire investment managers.”
About TheInsuranceAdvisor.com
THEInsuranceAdvisor.COM (TIA) is the leading provider of independent research for the pricing and performance of life insurance products. TIA’s mission is to provide financial advisors with the information necessary to make informed and prudent decisions in the management of life insurance policies and portfolios for their clients through a variety of Internet‑based, software and in‑print products.
For more information:
Daniel L. Babb
New York Bankers Association
212 297-1687
dbabb@nyba.com
Alec Herring
NFP Securities, Inc.
(406) 255- 5308
aherring@NFP.com
Barry D. Flagg, CFP®, CLU, ChFC
TheInsuranceAdvisor.com
(888) 908-8242 ext. 313 or
bflagg@theinsuranceadvisor.com
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