On Monday, November 12th, Genworth released a reprice of their GenGuard UL product. The new pricing targets a lifetime approach, which differs from their prior niche market focus, guaranteeing to age 105.
With the release of this rate adjustment, Genworth removed the following products from their portfolio: GenGuard SUL and Colony LifeLong UL (NY specific products Colony Term UL NY, GenGuard SUL NY, GenGuard NY). In addition, their new conversion product will be GenGuard UL, replacing LifeTime Protector SG II (in all states except NY).
Per their announcement, “future development will be centered around providing indexed universal life and linked benefit insurance offerings.” Overview:
- Prior to the changes, Colony LifeLong UL was, by far, the most competitive limited guarantee (to A100/105) product for lifetime pays (see attached Colony Lifelong Snapshots). Pricing cells for younger ages underpriced the market by 20%. Where Colony LifeLong UL lacked, GenGuard UL shined by offering the best premium for limited-pay solves. With the competitive pricing of both the LifeLong UL and GenGuard UL, Genworth offered the best pricing in the industry for limited guarantee sales.
- The rate revision focused on significant increases to limited guarantee pricing. GenGuard UL experienced increases of 20%, 30%, and 35% for lifetime pays, ten pays, and single pays respectively. At ages 40 and below, they added on an extra 10% increase for all pay structures.
- Changes to lifetime guarantees were less defined. The old pricing for GenGuard UL didnt perform the lifetime solve without a major price jump around 110. So, the new pricing looks like a decrease, but they are decreasing a very high premium.
- At the end of the day, the new pricing positions them at the middle-to-end of the pack. Full pays rank 18th-20th out of 23 products for both the lifetime and age 100 guarantees. Short pays are a little better, ranking around 16th-18th, and single pays fall in the 11th-13th range.
- Cash value accumulation is very minimal, if any. Middle ages see close to no cash at year 20, even for single and ten pays.
- Targets remained the same and still fall within the first half of the market.
The attached analysis inclues all of the products we benchmark (23/22 products considered):
1) Old Ranking for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios) 2) New Ranking for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios)
3) Ranking Changes (New vs Old) for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios)
4) Old Ranking for $1,000,000 DB, NLG A100 (single, full and short-pay scenarios)
5) New Ranking for $1,000,000 DB, NLG A100 (single, full and short-pay scenarios)
6) Ranking Changes (New vs Old) for $1,000,000 DB, NLG A100 (single, full and short-pay scenarios)
1) Old Ranking for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios)2) Old Ranking for $1,000,000 DB, NLG – A100 (single, full and short-pay scenarios) 3) Percent Premium is Below Next Best Rate (when ranked #1) for $1,000,000 DB, NLG – A100 (single, full and short-pay scenarios)
1) GenGuard New vs. Old Percentage Premium is Higher or Lower for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios) 2) GenGuard New vs. Old Percentage Premium is Higher or Lower for $1,000,000 DB, NLG A100 (single, full and short-pay scenarios) 3) GenGuard New vs. Colony LifeLong Percentage Premium is Higher or Lower for $1,000,000 DB, NLG – Lifetime (single, full and short-pay scenarios) 4) GenGuard New vs. Colony LifeLong Percentage Premium is Higher or Lower for $1,000,000 DB, NLG A100 (single, full and short-pay scenarios)