Overview:
- Over the past five years, INGs focus and direction has been centered on the indexed universal life marketplace. Just within the past year, ING released two different versions of indexed UL products (IUL-Global Choice & IUL-Protector), pulled all their no lapse guarantee products (including IUL-GDB), and are now pulling their competitive current assumption universal life product.
- IUL-Protector holds some competitive position, ranking within the top 5, when looking at the best non-smoker and best tobacco risk classes (especially for males). It was released with a 6.85% max illustrative rate.
- Even though the two products are structurally different, we wanted to compare the new IUL-Protector against the soon to be replaced Protector UL. When illustrating the IUL-Protector at the fixed rate (4.20%), it is rarely ever less expensive than the Protector UL (current crediting rate of 4.20%). IUL-Protector comes a little closer in price when illustrating it at 5%, but it is still more expensive. At a 7% interest rate assumption, assuming IUL-Protector at its max illustrative rate of 6.85%, the IUL premiums show up well below the replaced UL product. See attached ING IUL Protector vs Protector UL for more detail.
- Compared to IUL-Global Choice, there is a very, very small number of cells in which IUL-Global Choice will outperform IUL-Protector. Looking at both the 5% and the 7%, the range is roughly between ages 70 85, best tobacco for both male and females.
- Targets are identical to the Protector UL, which are mid-to-low compared to the rest of the products available in the IUL market. IUL-Protector offers unlimited rolling targets.
The attached analysis includes all of the products we benchmark (18 Products Considered):
- Ranking for $1 CSV @ 121 5%, $1,000,000 face amount (single, short & full-pay scenarios)
- Percent premium is above best rate for $1 CSV @ 121 5%, $1,000,000 face amount (single, short & full-pay scenarios)
- Ranking for $1 CSV @ 121 7%, $1,000,000 face amount (single, short & full-pay scenarios)
- Percent premium is above best rate for $1 CSV @ 121 7%, $1,000,000 face amount (single, short & full-pay scenarios)
NOTE: the maximum illustrative rate for the IUL-Protector is 6.85%; therefore we are only providing a comparison for the 5% & 7% assumptions, not the max illustrative rate assumption.
- Percentage premium is higher or lower for $1 CSV @ 121 7%, $1,000,000 face amount (single, short & full-pay scenarios)
- Percentage premium is higher or lower for $1 CSV @ 121 5%, $1,000,000 face amount (single, short & full-pay scenarios)
- Percentage premium is higher or lower for $1 CSV @ 121 FIXED RATE, $1,000,000 face amount (single, short & full-pay scenarios)
- Percentage target is higher or lower for $1 CSV @ 121 7%, $1,000,000 face amount (single, short & full-pay scenarios)
Additional thoughts and comments: its a little concerning to see a carrier remove a current assumption universal life product from the shelf, especially if they are replacing it with, yet another, indexed universal life product. Even though the life insurance industry is in a very challenging interest rate environment, we are hopeful that other carriers will remain dedicated to diversification of their product offering.