The continuing low interest rate environment has cause Canadian insurers to re-evaluate prices and policies related to products with guaranteed minimum interest rates.

Effective May 14, 2012, Canada Life will limit subsequent premium deposits to the guaranteed interest options, and daily interest options in contracts with guaranteed minimum interest rate provisions at $1,000 annually.

Contracts containing these provisions were generally issued in the late 1980s and early 1990s and include subsequent premiums related to these comprehensive annuity policies.

What’s Changing

• Lump sum premiums will be capped at $1,000 per year.
• Existing pre-authorized chequing (PACs) under $1,000 can only be increased to a total amount of $1,000 per year
• Existing PACs that exceed $1,000 per year can’t be increased
• If existing PACs are changed, they will be subject to the above limits

What isn’t Changing

• Canada Life will continue to provide minimum guaranteed interest rates on existing assets within these contracts.
• Existing PACs are unaffected as long as no chances are made.

Increases to PACs in excess of this limit will be declined. Lump sum premiums that exceed the limit will be returned to clients.

Standard Life anncounced that is is tempratily suspending new sales of its Guaranteed Lifetime Withdrawal Benefit Product (GLWB), the Ideal Income Series.  The suspension of sales takes effect April 16th, 2012.

Standard Life’s suspension of GLWB sales will “remain in effect untill the economic and regulatory environments improve”. 

As you are aware, there have been a number of changes recently announced in the GMWB market place.  At this time Empire life is not planning on making any changes, only enhancements in 2012.  Empire is comfortable with the current Class Plus product offering because of the following key points:

• The conservative nature of our internally managed product differentiates us from others in the market place.
• Our timing into the GMWB marketplace was favourable.
• Our business mix of traditional segregated funds and GMWB is more heavily weighted towards traditional segregated fund assets then many of our competitors.

Following the acquisition of AXA Life Insurance Inc., SSQ Financial Group is pleased and proud to be launching SSQ Insurance today. 

What’s New

• Rate reduction on Term and Loan Insurance Products
• First Year commission increased
• New all in one application
• new SSQ illustration software – SSQ 1.0
• The SSQ Merit Plan

Updated Marketing Material and software can be download here:

http://www.ssq.ca/insurance/advisors-page/illustration-software.asp

Empire Life will be making changes to the following permanent plans.  These changes will take effect February 21, 2012.

Solution 100 and 20 Pay Solution

• New rate increase

Trilogy and Trilogy Plus

• Rate increase will be introduced for level COI only
• Withdrawal of the Level Plus Return of Premium sum insured option
• No change to the 10 and 20 year minimum rate guarantee

Increase to Joint Last to Die Single Equivalent Age (SEA) calculations

• Age calculation will increase the SEA on JLTD plans be either 1 or 2 years.

Impact of Rate Increase

• Solution 100                  7.9%
• 20 Pay Solution          14.0%
• Trilogy Level COI          8.3%

Transition Rules

• Applications received in Head office after February 21, 2012 will be set up using the new plan rates and structures.
• All Pending “in the mill” business that is in Head Office on February 21,2012 will be eligible for the existing plan/rate structures.  These cases MUST be settled by April 30, 2012

At the December board meeting, the Board of Directors of Sun Life Assurance Company of Canada (‘Sun Life”) approved a recommendation to decrease the dividend scale for most participating policies issued by Sun Life Financial.

This dividend scale will be in effect from April.01, 2012 to March 31, 2013.

Inforce Business

• The 2012 dividend scale interest rate* will decrease by 25 basis points (bps), resulting in a new dividend scale interest rate of 7.15%
• The dividend on deposit rate will be 3.75%, except for RRSP policies and Bermuda policies with a variable loan clause.

New Business

Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings, providing clients with lifetime protection.  In many cases, our competitive positioning has improved despite this modest dividend scale decrease as several other carriers have announced their own dividend scale reductions.

• The 2012 dividend scale interest rate* will decrease by 25 bps, resulting in a new dividend interest rate of 7.15%
• On average Sun Par Protector and Sun Par Accumulator will see a decrease of approximately 3% in their annual dividend with the 2012 dividend scale.
• The dividend on deposit rate will decrease by 25 bps to a rate of 3.75%

New software reflecting these changes will be available January 27, 2012.

*The dividend scale interest rate is nor the portfolio yield of the Sun Life Participating account.  The rate is based on the portfolio yield and is used in calculating the dividend scale.  The dividend scale interest rate is only one component of many that are used to calculate the dividend scale that is applicable to a specific policy.  Other factors include mortality, expenses and lapse experience.

Changes to Canada Life Millennium Universal Life and Canada Life Critical Illness insurance, effective Feb.13, 2012

Life Insurance

• Cost of insurance rates will increase for level and limited pay options.
• Minimum guaranteed interest rates are being reduced on 5 an 10 year guaranteed interest options
• The rates will increase an average of 8% for all ages for Level COI
• The rates will increase an average of  6% for limited pay  COI for all ages
• The rates will increase an average of  13% for Level COI for ages 20 – 50
• The rates will increase an average of  11% for limited pay COI for ages 20 – 50
• 5 Year GIO will decrease from 2.0% to 1.50%
• 10 Year GIO will decrease from 2.5% to 2.0%

Critical Illness

• Increases to Critical illness insurance rates (Permanent Plans)
• T100 rates will increase by an average of 8%
• T75 rates will increase by an average of 9%
• T75 paid up at 65 rates will increase by an average of 11.5%
• Plans paid up in 15 years will increase by an average of 13.5%
• Decrease to Critical illness insurance rates (T10)
• T10 rates will decrease on average by 1%
• New rate band premium reduction for amounts of $500,000 and higher

Transition Rules

• New rates in the illustration software will be in effect Feb.13.2012
• There will be no exceptions to the rules stated below, including extensions to the final placement date: 

1.   Canada Life will not accept applications sent by fax or email.
2. All requests for product changes or increases in coverage during underwriting will be at new rates
3. All requests for reissues will be at new rates
4. To be eligible for old rates applications must be received at Canada life no later than Feb 13 2012 5 pm ET
5. Applications that are eligible for old rates must be issued by May 11 2012
6. All policies must be placed no later than 30 days after issue 

Effective January 1, 2012, the premium rates for IA Excellence Whole Life insurance products will increase.  This increase has been made necessary by recent economic circumstances and, more specifically, by lower interest rates.  The products affected by the rate increase are 10 year, 15 year, and 20 year paid up products as well as the payable to 100 product.

The press release published yesterday by SSQ Financial Group is now available for you to read on SSQ Site.

We are pleased to announce that on January 1, 2012, SSQ, Life Insurance Company Inc. concluded the acquisition of AXA Life Insurance Inc.: the new entity will be called SSQ Insurance Company Inc.

In addition to continuing to supervise all the activities of SSQ Financial Group’s Investment and Retirement sector in his capacity of Senior Vice-President, Mr. Bernard Tanguay has been appointed to the position of Senior Vice-President of SSQ Insurance Company Inc. (AXA Life Insurance Inc.). He is succeeding Mr. Robert Landry, who headed up AXA Life Insurance in recent years. We would like to take this opportunity to thank Mr. Landry sincerely for everything he has done and wish him much success in his future endeavours.

There are no changes to activities for the partners and agencies that were already doing business with AXA Life Insurance. You may therefore continue to deal with the different entities of SSQ (if you were already doing so prior to the transaction), as well as with the new business line, SSQ Insurance.

Wave 23.0 is now available .  The new software has a rate increase for Level COI plans.

BMO will continue to accept wave 22.0 application as long as they are recieved at head office by January 6th,2012.  Applications recieved after January 6th will be issued with the new rates.