Co-operators Life Insurance Company is hoping to attract new advisors and MGAs – and new clients – with two new par policies that went live in July.
“We have a pretty ambitious strategy,” said Paul Gobeil, vice president, Life Insurance and Wealth Management, at the Regina-based company.
Gobeil said Co-operators has third-party distribution that it operates under the CUMIS brand, but hasn’t offered a par whole life product for many years. (CUMIS partners with credit unions and their members to deliver insurance products and services. The Co-operators bought a portion of CUMIS in 2009 and the rest in 2018 and recently requested approval to merge its operations with those of CUMIS.)
It’s brought out the two products now because Co-operators is able to issue CUMIS whole life policies underwritten by Co-operators Life, which is the 100 per cent owner of CUMIS Life. “At the same time, we took the opportunity to redesign the product features and rates … so we could launch in the third-party channel with a bang,” said Gobeil.
The two new products are both participating life insurance policies that sit in different segments of the market. The new Whole Life Protector is unique, he said, in that it positions itself between the non par whole life high cash value market and the par whole life estate market. With Whole Life Protector the cash values start slightly later and grow steadily for the lifetime of the product.
The second product, known as Whole Life Ascend, is a blend of the estate and wealth markets. Cash values start earlier and grow faster in the early years. Gobeil said the two products should be able to meet the needs of many different market segments.
He said the industry knows that the majority of sales in the MGA channel come from whole life and that Co-operators has been missing out on that over the years.
“So we [now] expect some pretty healthy growth for ourselves and the channel.” He said the company expects similar sales results to studies that show advisors sell 60 per cent par whole life.
The CUMIS brand of products has been exclusive to MGAs and national accounts, while the Co-operators label is for MGAs, brokers and career advisors who are multi-line exclusive agents for the insurer.
Both new products are participating with guaranteed cash value and dividends. The Whole Life Ascend product has more features, including an enhanced dividend option and an additional deposit option. Gobeil said the additional deposit option can be important for business owners or affluent clients who have maxed out their registered investments and want other vehicles to grow their net worth. He said a whole life policy with an additional deposit option can allow clients to put in additional premiums and manage their cash flow while those extra premiums contribute to the growth of the policy. Clients cannot skip a payment but can reduce the premiums to a low level and then ramp them back up again if they wish.
“We are really open to establishing some new relationships with advisors or MGAs.”
The new products are underwritten by Co-operators Life and backed by participating accounts of the company, which has more than $1 billion in assets.
