Lincoln National's universal life reserves are 'more than adequate': CEO

Lincoln National Corp.'s CEO today stressed that the insurer has sufficient reserves for its universal life products
NOV 21, 2011
Amid state insurance regulators' questions on whether carriers are properly reserving against a certain type of universal life insurance, Lincoln National Corp.'s CEO today stressed the insurer has sufficient reserves for its products. State insurance regulators in the National Association of Insurance Commissioners' Life Actuarial Task Force on Tuesday said some insurers are calculating reserves for their universal life with secondary guarantees based on assumptions that customers are paying higher premiums into their products. The regulators said that carriers should be basing their assumptions on policyholders paying the lowest amount of premiums needed to keep the policy and its secondary guarantee intact, which would require higher reserves. That assertion ran into opposition from insurers, including Lincoln National, who insist they have been following the law when reserving and that insurance regulators in their respective domiciliary states can testify to that. Indeed, the regulators' questions seem to be more a matter of reserving methodology rather than a question of insurers' financial strength. “I have full confidence that our reserves are more than adequate and that we comply with this particular regulation,” Lincoln chief executive Dennis Glass said on an earnings conference call today. “We have a lot of smart people in the NAIC who are practical and who want to do the right thing; we need to work through on this issue.” Indiana insurance commissioner Steve Robertson today released a letter stating that Lincoln is in “sound financial shape and at no time before or during the deliberation of this proposed guideline did the [department's] financial analysis of Lincoln change.” Referring to a Wall Street Journal article that ran Tuesday on the regulators' discussions, Mr. Robertson noted that the matter should not be interpreted as a question about Lincoln's solvency. “The deliberations on which this article was based should in no way be construed as a question about Lincoln's financial health from a solvency standpoint,” his note said. “The department's ongoing financial examinations and analyses, conducted both on an annual and quarterly bases, in addition to the company's five-year financial exam, have not noted any reserve issues.”

Latest News

Integrated Partners, Kestra welcome multigenerational advisor teams
Integrated Partners, Kestra welcome multigenerational advisor teams

Integrated Partners is adding a mother-son tandem to its network in Missouri as Kestra onboards a father-son advisor duo from UBS.

Trump not planning to fire Powell, market tension eases
Trump not planning to fire Powell, market tension eases

Futures indicate stocks will build on Tuesday's rally.

From stocks and economy to their own finances, consumers are getting gloomier
From stocks and economy to their own finances, consumers are getting gloomier

Cost of living still tops concerns about negative impacts on personal finances

Women share investing strengths, asset preferences in new study
Women share investing strengths, asset preferences in new study

Financial advisors remain vital allies even as DIY investing grows

Trump vows to 'be nice' to China, slash tariffs
Trump vows to 'be nice' to China, slash tariffs

A trade deal would mean significant cut in tariffs but 'it wont be zero'.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.