On Monday, March 23rd, AXA released Incentive Life Legacy III, which replaces Incentive Life Legacy II. With this release, targets saw double digit increases and cash values saw double digit decreases, all while retaining less than 10% changes (+ or -) to 8% endowment premiums. The resultant is a stripped down version of the ILL II that holds onto its low-cost competitive edge.
The premium changes were definitely geared towards adjusting rates at the lower assumed interest rate. The 8% Gross Endowment @ Maturity premiums experienced very minor changes. Younger ages saw decreases by a percentage or two, and ages above 50 saw mostly small increases. The 6% Gross Endowment @ Maturity premiums followed the same pattern, but had larger changes with roughly 14% decreases trailing off to increases after age 60. After the significant decreases in the 6% scenarios, AXA moves into the #1 or #2 spot for almost every nonsmoker full-pay scenario. Ten-pays still maintain top 10 ranking and single-pays average between 10th and 12th.
It appears as if AXA is trending toward drawing a clear line between their accumulation-oriented product (Incentive Life Optimizer II) and their death benefit-oriented product (Incentive Life Legacy III). Cash values were butchered with this release. Cash accumulation and surrender values still exist; however, dramatic decreases leave Incentive Life Legacy III ranking forth quartile for cash value at any year.
The benefit AXA’s gained from stripping the cash seems to be reinvested in target premiums. Targets for nonsmokers rose 10% to 30% up to age 70. Tobacco user targets did not change.
Rates were posted to the LifeTrends website on Tuesday, March 24th.