The growing “independent” nature of insurance distribution, combined with a more proactive regulatory environment, has heightened the need for independent, arms-length due diligence, compliance and monitoring of the underlying financial strength of insurance carriers.
Over the past 30 years, the distribution of insurance products has continued to shift from captive strategies to third parties, such as financial institutions, independent brokers/agents, and direct channels.
Insurance distribution clients include:
Today’s financial institutions often provide a spectrum of insurance products to their banking or investment clientele, including life and annuity products, personal and business property and casualty coverages, and medical and supplemental health insurance.
Because financial institutions face substantial regulatory oversight as well as internal audit requirements, they are required to perform and document regular financial oversight of their insurance company partners selling these policies. ALIRT models meet the O.C.C. standards for a validated quantitative model for assessing insurer risks and exposures.
Through its core ALIRT Service, ALIRT specializes in meeting just these needs. In fact, ALIRT currently supports the due diligence efforts of the country’s four wirehouses, along with the vast majority of the country’s large and mid-sized banks and independent regional broker/dealers.
For more information on how we can help your bank and broker/dealer insurance oversight and compliance program quantify the risks of its insurance partners, please contact us at firstname.lastname@example.org.
Independent Insurance Agents/Brokers
Independent Insurance Agents/Brokers continue to represent a predominant channel for the distribution of life insurance, annuities, property & casualty insurance, and/or health insurance products.
All insurance distributors face a similar challenge today: how best to track and report the relative financial performance of their insurance partners in an environment where broad macro-economic factors can quickly alter an insurer’s ownership structure, product mix, and distribution appetite.
Through its core ALIRT Service, ALIRT specializes in helping the independent broker/agency system make sense of the welter of financial and market intelligence continuously impacting their carrier partners – and ultimately the financial well-being of their clients.
For more information on how we can help your agency develop a top tier set of standard operating procedures (SOP’s) for tracking insurer risks, please contact us at email@example.com.
Pension Termination Annuities/Pension Risk Transfers
Termination Annuities/PRT/DC Annuities
Rapid change in today’s pension environment has spurred innovative solutions from the insurance industry. Using Termination Annuities or deferred or immediate annuities within 401k plans to meet long-term pension objectives are important options for a growing number of business organizations – and for the brokers who serve them.
The long-tail nature of these programs, along with strict ERISA fiduciary liability, makes the financial strength of the carriers that issue the policy contracts indispensable. Our Department of Labor Interpretive Bulletin 95-1 (DOL IB -95-1) Termination Annuity Issuer Analysis and DC Plan Issuer Analysis services are designed to provide corporate buyers, brokers or pension consultants of Terminal Funding and/or 401k Annuities with a consultative, easy-to-understand and auditable due diligence package to meet the “thorough and impartial investigation” of insurers’ bidding on these transactions for selecting the “safest available annuity”.
Registered investment advisors that recommend insurance and tax advantaged solutions for wealth protection continue to grow as a an important channel for insurers. RIA’s act as fiduciaries for their clients to act in their best financial interest.
The ALIRT Service offers an auditable trail for the analysis of competing insurers with independent and thorough reporting documentation. RIA’s will backstop their fiduciary responsibilities and reduce the potential conflicts of interest that can present themselves in complex transactions as well as monitor the legacy business already placed and possibly have justification for proactively bringing deteriorating insurers to their clients’ attention to serve as a basis for remediation.
For more information on how we can help buttress fiduciary liability and conflicts of interest and assist RIA’s to formulate a top shelf set of standard operating procedures (SOP’s) for selecting insurers and tracking insurer risks, please contact us at firstname.lastname@example.org.
Bank Owned Life Insurance (BOLI)
Bank Owned Life Insurance (BOLI) has long been an attractive investment alternative for banks and credit unions given the use of tax deferrals to meet growing employee benefit/retirement/and key man funding needs, as well as its non-correlation to many other investment classes.
The often sizeable exposure to these products, however, along with heightened regulatory and internal audit scrutiny, makes financial oversight of the carriers that issue the policy contracts indispensable. This need for strong due diligence only increased with section 939A of the Dodd/Frank legislation, which mandates that banks no longer rely solely on rating agencies when vetting their BOLI products. BOLI brokers are now often called upon by their clients to offer this additional level of carrier financial oversight.
ALIRT’s BOLI Service is designed to provide both BOLI brokers and banks with an easy-to-understand quantitative and qualitative approach to analyzing the relative financial performance of insurance companies, which meets heightened requirements under Dodd/Frank.
To learn more about how ALIRT can support your “arms length” due diligence efforts and meet ERISA due care requirements, please contact us at email@example.com.