Largest Study of Life Insurance Industry Mortality

Milliman has completed one of the largest and most comprehensive life insurance mortality and lapse studies ever undertaken. The study is called Milliman Industry Mortality Study and Analysis (MIMSA) and covers the United States individual insurance business of 29 companies.

MIMSA found that the “[o]verall mortality ratio was only 87% of the expected rate, implying better experience than the most recent industry mortality table.”While it is often thought that all/most insurers experience roughly the same mortality experience, the MIMSA reveals that “there was a large range of results from company to company in actual mortality experience” which means that different companies will likely have to charge widely different cost of insurance charges (COIs) based on this disparate experience.  When overall mortality averages 13% BETTER than original policy pricing, this means that some insurers are experiencing MUCH better mortality costs than they originally expected to charge for in COIs.  Conversely, some insurers are likely to have to increase COIs because their actual mortality experience appears worse than they originally expected to charge in COIs. 

“The life insurance industry relies on current and reliable information to be able to bring valuable products to consumers at a fair price,” added Bruce Winterof, Life Practice Director, in Milliman Chicago office. This MIMSA study, therefore, raises two questions: 

1.       Are you(r clients) getting reductions in charges being deducted from the policy account commensurate with more favorable experience than that which was originally priced, or

2.       Are you(r clients) insured with one of the insurers who have to increase charges to cover mortality experience that has been worse than expected?  

If you don’t know what you(r clients) are being charged for cost of insurance charges (COIs), fixed administration expenses (FAEs), cash-value-based “wrap fees” (e.g., M&Es) and  premium loads then you/they don’t know if/when they are being over-charged, or if/when you/they should be expecting a reduction in charges. 

THEInsuranceAdvisor.COM is simply the fastest, easiest, and most credible, comprehensive and cost-effective way to independently verify to clients and their advisors whether or not the pricing and performance of existing or proposed life insurance is in their best interest.  Only THEInsuranceAdvisor.COM is accepted for independent client representation, endorsed by the New York Bankers Association (NYBA) and compliant with regulators. 

Use the Confidential Policy Evaluator (CPE) Research Reports to determine the appropriateness of pricing, the reasonableness of performance expectations for invested assets underlying policy cash values, and overall suitability for you(r client’s) policies based on the 5 factors of suitability.  Click here and get up to 3 Confidential Policy Evaluator (CPE) research reports under our NO-Risk trial subscription.