Reliastar/ING has announced its plans to suspend all universal life products it issues that have secondary guarantees. In an announcement dated today October 17, 2012 ING cited difficult economic times and Actuarial Guideline 38 as a key reasons for its decision to suspend these products.
This news comes as several carriers have either pulled back or suspended universal life product with secondary guarantees. Interestingly, this announcement was the first one we're aware of that specifically mentioned AG38 as a primary reason behind a company's decision to end a secondary guarantee benefit.
ING stipulated the transition rules for new business. It will accept applications for new business until Friday November 2, 2012, (NY replacements, which must comply with NY REG 60 guidelines will have until November 16th to be submitted).
All underwriting requirements will need to be received by December 13, 2012 and all policies must be placed by December 31, 2012. Policies involving 1035 exchanges will need to have at least monthly premiums paid starting on or before December 31st and paid every month until the exchange money arrives.
ING suspended it's 25 and 30 year term insurance earlier in the year. Term products with durations longer than 10 years are in the same boat as universal life with a secondary guarantee regarding Actuarial Guideline 38.
If more news develops about ING or secondary guaranteed universal life, we'll be sure to bring you that information.