Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
We did not identify any subjects warranting coverage in our monthly LRA Update.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
We did not identify any subjects warranting coverage in our monthly LRA Update.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
We did not identify any subjects warranting coverage in our monthly LRA Update.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Finding relevant information about the BOLI/COLI market or topics can be frustrating and sporadic. Certainly, there’s no shortage of information (and phone calls) about products and offerings, but what about the landscape of the industry and its risks?
Here you’ll find an in-depth look at the market including ownership by asset size, transactions, and what types of investments banks are allocating to in their separate accounts.
Beyond the industry analytics, there are counterparty strength ratings and a robust description of updates specifically impactful to BOLI owners or programs.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Some life insurance products that are currently being marketed for businesses may expose the policyholders to significant valuation adjustments (i.e., write-downs) for balance sheet and income statement purposes. The situation arises because some product offerings seek to apply a specific citation under GAAP that is at least somewhat unclear. However, the result of applying this specific citation (out of context) can be objectively and empirically shown to be counter to the underlying principle set forth under GAAP for these assets (addressed in ASC 325-30), which typically requires businesses to carry these assets at the net realizable value of the insurance contract.
The products in question seek to settle the insurance contract obligations over extended time periods, but, instead of complying with a specific rule that such extended payments are subject (by the policyholder) to discounting, the products seek to comply with GAAP under a provision that may be construed to not require a realizable value.
We ask a reader: Does an exception from discounting really mean that the policyholder can carry the asset at a demonstrably unrealizable value?
We then analyze the underlying GAAP as it relates to these assets and provide descriptions of the product structures that we believe are inherently lacking in substance. We also provide empirical examples of the structures.
In one of the empirical examples the interest credited during the extended settlement period was floored at zero for 5.5 years. This resulted in a total decrease of ~$2.3 million in the carrying value from when the policy termination was requested to the date that the contract’s defined interest rate rose above 0%. At the settlement date, it is worth noting that the product provider had no loss exposure whatsoever. When we discount the amount received by the riskless rate, we arrive at a realizable value closer to $87 million versus the purported carrying value of $100 million.
We conclude that the adoption of approaches that set aside the premise of net realizable value as the underlying foundation for the carrying value could result in undesirable financial reporting adjustments – potentially at very inopportune moments (e.g., when the amount of the restatement could be quite material).
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
In March 2019, the IRS released proposed regulations for “Information Reporting for Certain Life Insurance Contract Transactions and Modifications to the Transfer for Valuable Consideration Rules.” The comment period extended to May 9, 2019.
Through our external counsel, Davis & Harman, we submitted a comment letter to the IRS seeking additional clarifications with respect to 1) BOLI Pooling Transactions; and 2) IRC § 1035 Exchanges.
All institutional purchasers and sponsors of life insurance should have enough knowledge about the mortality costs, benefits and risks associated with corporate owned and bank owned life insurance (COLI/BOLI) programs. The required knowledge includes an understanding of the differences between experience-rated mortality designs and non-experience rated designs, since failure to make an informed decision in this area can result in enormous, yet avoidable, exposures to excessive costs. It is also important to understand some of the legal, regulatory and accounting considerations that impact mortality risks. Finally, it is important to understand some of the common misconceptions about these programs that have been fostered by disinformation.
This 3-part series of papers by Matthew B. Schoen and James P. Van Etten attempts to provide state of the art discussion to address these needs.
Presently, there are several companies looking to issue Stable Value Protection (SVP) for BOLI, and there appears to be significant interest by banks to evaluate and implement these solutions. We delve into some of the key accounting considerations of which BOLI owners should be mindful when evaluating these products.
Buyers must beware! SVP providers generally offer no assurances as to the accounting treatment of the SVP features they offer. As described in the paper, the implications of misunderstanding and mischaracterizing the GAAP treatment of an SVP feature could be severe.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
A participant’s split dollar economic benefit is determined by multiplying a cost per $1,000 factor (based on the participant’s age) by the participant’s benefit under the split dollar arrangement, divided by 1,000. But how is the economic benefit determined when the arrangement involves a joint and survivor life insurance policy? We have observed diversity in practice with regard to how the economic benefit is computed for these types of arrangements. In particular, some computations include an interest rate discount factor of 2.5% when determining the cost per $1,000 rate whereas others do not. Is this factor appropriate? What is its purpose? Where did it originate? This paper summarizes our research and findings as to whether a 2.5% discount rate factor is set forth by the IRS and/or otherwise appropriate to use.
After the 2017 inaugural survey, we received feedback from several participants on topics, length, and frequency of the survey. Most agreed the findings were valuable and encouraged us to repeat the survey in 2018.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
Can an “insurer’s lower published premium rates” be used to determine the Cost of Insurance Protection under a split-dollar arrangement entered into after September 17, 2003?
This report investigates whether or not it is permissible to use an insurer’s lower published premium rates (instead of using IRS Table 2001) when computing imputed income under the economic benefit regime for a non-equity split-dollar life insurance arrangement entered into (or materially modified) after 9/17/2003.
To which investment strategies are Separate Account BOLI owners allocating? As the economic landscape changes, will owners reallocate? Our ongoing study sorts SA portfolio allocations into 8 sector types and analyzes how the weights have changed over time. The study also includes metrics and breakdowns on passive vs active management, risk-weight estimates, and proxy returns for the SA BOLI industry.
Reports on a 1-year lag are available to view. Current up-to-date reports are complimentary with login. To access the most recent reports, please register or login.
In May 2018, the NAIC Statutory Accounting Principles (E) Working Group continued its deliberations on the regulatory treatment of Private Placement Life Insurance (PPLI) and Private Placement Variable Annuities (PPVA) products owned by insurers. Under the exposure, insurers that own ICOLI policies would need to meet two requirements in order to continue the current practice of recognizing the values fully as admitted assets: 1) The policies must comply with IRC §7702; and 2) The owner of the policy must not be subject to investment risk (meaning the net realizable value does not change as a result of market fluctuations). MBSA submitted a comment letter to the NAIC recommending a more comprehensive review of ICOLI as an asset class owned by insurers. We drew several references to bank regulatory guidance and ultimately recommended that the NAIC evaluate both the risk-based capital framework as well as whether or not the products qualify as admitted or non-admitted assets for statutory accounting purposes.
While the recent enactment of tax reform did not directly change the tax treatment of BOLI (i.e., cash value growth remains tax deferred and death benefits generally remain tax free), the reduction of the corporate tax rate from 35% to 21%, effective January 1, 2018, significantly impacts the economic attributes of BOLI. In this paper, we analyze the magnitude of impact in an effort to answer the question of whether the lower tax rates are likely to cause widespread surrenders.
We recommend to anyone considering a BOLI purchase, or a change in program administrator, to undergo a competitive RFI process to choose their vendor. We’ve compiled an extensive list of questions posed to us by banks using a BOLI vendor RFI approach in the past. We are making it available to you in the hope that it serves as a foundation for your own vendor RFI. Use those questions that are germane; lose the rest. We are available to help you to further tailor the RFI to compel disclosure of the information essential to meeting your specific needs.
While we are pleased with the level of participation in this initial tally (demographics follow), and hope you share our view that the findings include valuable insights, we hope, over the succeeding years, to achieve broader participation, increasing the value of each yearly installment. We’ve done our best to present the results without bias.
In August 2017, the OCC requested comment on whether certain aspects of the Volcker Rule’s implementation regulation should be revised to better accomplish the purpose of the rule and decrease the compliance burden on banks. The Volcker Rule specifically prohibits investments in an issuer that would be an investment company, as defined in the Investment Company Act of 1940, but for section 3(c)(1) or 3(c)(7) of that Act. Most private placement separate account BOLI references those same exemptions from registration. However, as part of the initial development of the rule, variable separate account BOLI was provided an exemption, subject to meeting certain conditions. In our comment letter, we recommended two additional clarifications to the existing BOLI exemption.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.
We did not identify any subjects warranting coverage in our monthly LRA Update.