The article describes a problem that can arise if retirement income taken from life insurance policies is not managed and adjusted. Specific examples and extensive testing results are cited for a model policy of indexed universal life insurance. Actions to address the problem are briefly described for advisors and insurance companies.
Author: Ben Wolzenski, FSA, MAAA, is the managing member of Actuarial Innovations, LLC, a one-person actuarial consulting firm in St. Louis, MO. His past experience focused on the development and distribution of life insurance products. He served as executive vice president of General American Life Insurance Company in the closing decade of his 32 years with that company, and formed Actuarial Innovations following his retirement. He is a fellow of the Society of Actuaries and member of the American Academy of Actuaries.