Industry Leader Forum: Minnesota Life Insurance Company
The rate of change is not going to slow down anytime soon. If anything, competition in most industries will probably speed up even more in the next few decades.” (John P. Kotter—Leading Change.)
In today’s ever-changing world, this quote couldn’t be more true. Although life insurance has existed in some form for thousands of years, the rate of change in both products and technology within modern life insurance companies is accelerating rapidly, along with an increasing number of competitors.
As an industry-leading life insurance carrier, it’s important that we maintain a diligent eye on the economy and our peer companies as we try to anticipate and embrace changes in our industry. As a result, new products and technological advances are being created each day that enhance the efficiencies in the development of new life insurance products. However, these changes may also come with a price. Therefore, while change is important to maintaining a competitive position, we, along with other carriers, are increasingly more sensitive to consumer sentiment with regard to premium payments in these difficult economic times.
So in a world filled with continuous change and increasing economic pressures, how does an insurance company stay ahead? For Minnesota Life, it’s about focusing on our core capabilities and incorporating new technology and products to make overall results better for our advisors and policyholders.
We use technology to differentiate ourselves from the competition, providing service, customized products, and solutions for clients and advisors to streamline the application process. In addition to improving service and productivity, we continue to leverage our administration system and illustration platform to broaden our product portfolio of fixed, variable and indexed life insurance products.
With the implementation of eApplication in 2010, we now offer options for advisors to submit business easier, faster and greener. In addition, it opened doors to exploring the development of simplified or express issue products—expanding the appeal of Minnesota Life products into the middle market. By offering basic protection through a transaction sale process that is easy to apply for, moves through the underwriting process quicker, and requires less premium, we will quickly broaden our markets outside our traditional targets. In addition, simplified or express issue products lead to the future development of automated services.
Responsive Product Development. Each quarter, Minnesota Life releases new products and/or enhancements to existing products. This schedule allows us to continue our innovation in product design and offer a wider variety of options for our clients. In February 2012, we will enhance our Eclipse IUL product series with two additional index crediting options, a blended index option, and a multi-year index option. The addition of a blended index account adds a diversification option that helps provide more stable crediting rates. And a multi-year index option will provide potentially higher upside for those clients seeking additional accumulation options.
In addition to being an industry leader in the indexed life market, we offer a wide array of term, universal, survivorship, variable and whole life products that help best meet the needs of all of our clients.
Pricing Challenges. It’s no secret that in recent years economic forces, the Federal government and various other changes have lowered interest rates to levels not seen in more than three decades. Although this is good for individuals purchasing homes or acquiring personal loans, lower interest rates have a large impact on insurance companies.
As interest rates remain at historic lows, the burden on our general accounts and other investments to make up the difference is challenging at best. To ensure we’ll be here to fulfill our promises, we continue to prudently manage our business, a reason why we remain one of the nation’s most highly-rated companies. Based on ratings from all four of the major agencies, only 14 other insurers have the same as or higher ratings than Minnesota Life.
Spirit of Mutuality. For more than 130 years, Minnesota Life has fulfilled its obligations—in good times and bad—adhering to long term management and investment strategies rooted in our mutual tradition.
We provide long term value for our policyholders through our mutual holding company structure, which allows us to take a long term approach that positions us strongly, regardless of what happens in the economy. And because we are not publicly traded, we can focus on the best interests of our policyholders.
Minnesota Life’s individual and group product lines provide valuable life insurance protection to more than nine million clients, making us one of the largest life insurers in the nation. As we continue to adapt to a changing environment, we remain dedicated to our focus on our core capabilities and history of serving our clients. We look forward to the opportunity to share these values with you. [RJE]