Vanishing Premiums
Vanishing Premiums
If I bought a camera down the street and when I got back to my hotel room, the shop owner called me and said, “Oh, by the way, you owe me another $100 for that camera,” I would feel exactly like many of the vanishing premium victims have felt.
I understand the lawsuit. I think we could have avoided the problemthrough effective reillustration. — Christopher H. Hause
1995 – CURRENT DEVELOPMENTS SURROUNDING REGULATIONS AND STANDARDS OF LIFE AND ANNUITY PRODUCTS, – 18 p, Society of Actuaries
Society of Actuaries
1995 – SALES ILLUSTRATIONS, Society of Actuaries1995 – CURRENT DEVELOPMENTS SURROUNDING REGULATIONS AND STANDARDS OF LIFE AND ANNUITY PRODUCTS, – 18 p, Society of Actuaries
1995 – PRACTICAL ILLUSTRATIONS AND NONFORFEITURE VALUES, Society of Actuaries – 14p
1996 – Legal Issues Affecting Nontraditional Products
1997 – VANISHING PREMIUM ILLUSTRATIONS REVISITED, ARNOLD F. SHAPIRO Legal Cases
199x Prudential
My next comment relates to the vanishing premium “payback.” I guess I’d have to say I’m disappointed that companies haven’t defended themselves more vigorously in this whole situation.
Maybe the reason is that their agents didn’t do the proper job at the
point of sale.
But if the agent did, and if the agents have a good file, and they’ve been
following up since the point of sale/issue and have communicated properly to their clients the impact of interest rate changes on at least an annual basis, I don’t think we would have this problem.
I found it fascinating that the agent in the Crown Life case got $40 million for mental anguish. MR. KEVIN A. MARTI
1995 – SALES ILLUSTRATIONS, Society of Actuaries MR. SLOAN: The vanishing-premium concept has been with us since the beginning of
the century. I’ve seen illustrations of policies in companies that were formed about that
time and had things that we sometimes call charter policies, and coupon policies, for
example. One company I know routinely sold a coupon policy, 20-pay, with the coupons
cancelled, which made it a 14-pay. That’s a vanishing premium. This was brought out, I
think, in 1914, so it’s not a new concept, but I’d like to point out one other real problem,
and that’s that most of these illustrations are not made up in the home office–they’re
produced on laptops in the field
1995 – PRACTICAL ILLUSTRATIONS AND NONFORFEITURE VALUES, Society of Actuaries – 14p
