Insurance companies have taken strides to improve their statements in an attempt to dismiss the belief of complexity relating to universal life insurance products.
Manulife Financial, Standard Life, Canada Life and Transamerica Life Canada are the best at providing policyholders with statements that are informative, appealing and straightforward, according to DALBAR’s 2004 Universal Life Policyholder Statement Analysis.
The statements from the four companies were the only ones to earn DALBAR’s ‘Very Good’ statement designation.
The Universal Life Policyholder Statement Analysis examined statements from 12 Canadian insurance companies and used DALBAR’s criteria to assign each a score out of 100.
DALBAR’s report evaluated universal life statements based on their ability to:
- provide relevant information for policyholders;
- use clear, concise language for average clients;
- inform clients of significant issues affecting their policies; and
- highlight the most important information.
The top-ranked Universal Life statements for 2004 are:
- Manulife Financial;
- Standard Life;
- Canada Life;
- Transamerica Life Canada;
- and Empire Financial Group.
.Accrording to DALBAR, the firms have enhanced their statements by incorporating two significant improvements. The first involves the language reported on the statements. DALBAR says firms are trying to make them as easy as possible to read and understand for the average client and are accomplishing this by replacing industry jargon with more laymen’s language and by replacing acronyms with entire words.
The second improvement involves the disclosure of all relevant information about the policy. Although DALBAR says this area can still be enhanced, it is one in which it has witnessed much improvement since it last conducted a statement analysis in 2002.
In 2004, DALBAR finds that more statements displayed information such as the policy’s rate of return and the policy’s primary beneficiary.
“While these improvements are encouraging,” said Mark McDonald, client relationship nanager of DALBAR’s Toronto office, in a release, “there are still others that can be made.”
He gave the total death benefit as an example, as most statements did not display this value.
Accrording to DALBAR, these features are crucial components of any insurance policy and require regular monitoring to ensure the policyholder’s objectives are being met and should not be overlooked by the policyholder, the agent or the insurance company.