Business Underwriters Associates, LLC

AIG: Coming Soon May 15th – IUL Product Updates

04-30-2021

Effective May 15th, AIG is adjusting the Value+ Protector Index Universal Life product with feature enhancement.

Reprice: Value+ Protector II

We are repricing Value+ Protector II in the continued low interest rate environment while updating the Cash Value Accumulation Test (CVAT) interest rate to meet the new IRC 7702 requirements. Premiums will increase slightly while younger age guarantees decrease to under age 90. There are no changes to cash value, target premium, cap and par rates.

Enhancement: Dollar Cost Averaging Rider

In addition to lump sum payments (1035s and non-1035s), AIG is enhancing the DCA rider to allow ongoing annual, semi-annual and single premiums to be allocated to this rider and dispersed to the Index Interest Account over a number of months. With this release, DCA availability will be expanded to all new business Max Accumulator+/Max Accumulator+ II and Value+ Protector/Value+ Protector II issued on or after June 2018. This rider will also become available on both USL Max Accumulator+/Max Accumualtor+ II and USL Value+ Protector/Value+ Protector II in New York.

 

AIG is repricing Value+ Protector II, effective May 15, 2021, due to the impacts of low interest rate and spread, especially on younger ages. In addition, the Cash Value Accumulation Test (CVAT) interest rate is updated to meet the new IRC 7702 requirements. As a result of the change:

  • Premiums will increase slightly by 1-3%
  • Primary guarantees for younger insureds (45 and under) will drop below age 90, while older ages can still be guaranteed to and around 90
  • No or minimal change to cash value and target premium
  • No changes to cap, par and max illustrated rates

Value+ Protector II – Fast approvals with expanded Non-Med underwriting

  • Quick access to coverage through non-medical underwriting for hassle-free buying experience. No labs, no exams are required for qualifying clients:
  • Ages 0-50 (18-50 in New York)
  • Face amounts $50,00-$1,000,000
  • UW classes Standard to Preferred Plus Non-Tobacco, Standard to Preferred Tobacco
  • As a reminder, VPP II has competitive premium, strong guarantees, cash value, and choices with unique volatility control indices* like the ML Strategic Balanced Index® (MLSB) and the PIMCO Global Optima Index®
  • Ability to customize with a menu of riders such as Accelerated Access Solution® chronic illness rider and others to protect clients from the unexpected and tailor to different financial goals

 

Transition Rules

AG Quick Ticket

  • New Value+ Protector II rates are effective May 15, 2021.
  • Applications submitted via Quick Ticket by May 14, 2021 will receive the old rates if AIG receives the application in good order by June 1, 2021.
  • Applications submitted via Quick Ticket by May 14, 2021 will receive the new rates if AIG receives the application in good order after June 1, 2021.
  • Applications submitted to AIG via Quick Ticket on or after May 15, 2021 will automatically receive the new rates.
  • Reissue Requests will not be honored.

iGO Full e-Application

  • New Case Value+ Protector II: If the Agent selects Value+ Protector II product on or after May 15, 2021 12:00 AM CDT he/she will receive the new Value+ Protector II rates. Winflex Illustrations will also provide the new Value+ Protector II rates.
  • Locked Case (Value+ Protector II): When the agent enters iGO Full e-Application for a Locked Case, he/she will be permitted to complete the eSignature and eSubmit process. Cases locked before May 15, 2021 12:00 AM CDT must be submitted within 15 business days after the case was locked to retain the old Value+ Protector II rates.
  • Cases Started, In Process, or Unlocked Cases on or after May 15, 2021 will receive the new Value+ Protector II rates. Winflex and iGO Full e-Application will recalculate to the new rates.

Paper Applications

  • New Value+ Protector II rates are effective May 15, 2021.
  • Applications received on or after May 15, 2021 will receive the new rates.
  • Starting 4:00 PM CDT on May 14, 2021 only the new rates will be available in Winflex.
  • To receive the old rates applications must be received on or before May 14, 2021.
  • Reissue requests will not be honored