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ProdMod: Prudential Announces Changes to IUL Caps and Spreads

FROM PRUDENTIAL…

At Prudential, we are committed to maintaining financial discipline and continue to review impacts to the index accounts, and the upside they can offer. The caps will be improving for almost all products. The uncapped accounts for IUL products will also be changing.

These changes will be effective for index segments starting January 15, 2023. Click here to view the complete list of index changes.

A letter will be sent to policy owners when there are changes to index accounts/strategies, informing them of the new spread and that the future segments will be impacted. The letter also indicates that these changes may result in different values than were shown in their most recent illustration and how they can request a current illustration.

Click here to view the complete list of index changes

Find out more about these changes from Prudential…

 

ProdMod: Prudential to Lower Pricing on Term Essential by an Average of 9%

FROM PRUDENTIAL…

Effective January 9, 2023, Term Essential rates will be reduced by an average of 9%. This means that you can offer more affordable life insurance protection to clients.

Important Dates
  • January 8, 2023 (Last Day for Old Rates): Last day that an application can be signed with a request for Old Rates. The inventory of cases with a sign date of January 8th or prior will have a price compare performed at policy issue. The policy will be updated to the new rates if lower at the time of underwriting approval.
  • January 9, 2023 (Ready to Sell Date): New Rates for the repriced product are in effect. All applications signed and dated¹ on or after January 9, 2023, will receive New Rates.
  • January 13, 2023 (Home Office Receipt Date): Last day that an application can be received in the Home Office with Old Rates.
  • March 10, 2023 (Placement Date): Last day that a pending case can be placed with old rates. All delivery requirements must be received in good order by end of business day (4 PM EST).
Transition Rules
  • Updates to applications as part of establishing a trust or finalizing the ownership arrangement can be made after the application deadlines outlined in the transition rules. However, these cases must still meet the application deadlines for the original application and comply with all other deadlines outlined in the transition rules.
  • Informal/Inquiry applications will not be eligible for Old Rates unless replaced by a live application by the “Last Day for Old Rates” deadline outlined in the transition rules.
  • Requests for New Rates are subject to all of the deadlines outlined in the transition rules.
  • No application or request to change to new rates can be backdated greater than 6 months prior to their State’s Ready to Sell Date.
 
¹Definition of “application date”:
  • Pru Advisors Prepaid eLife – Date on the form of payment and the Authorization, Acknowledgement and Limited Insurance Agreement form
  • Pru Advisors COD eLife – Date the Authorization, Acknowledgement, and Limited Insurance Agreement form and Variable Contract Acknowledgement form (if applicable) were signed by the client
  • Pru Advisors or Third Party Full Application case – Date the Part 1 of application (ORD 96200) was signed
  • Third Party Prepaid Xpress QuickForm case – Date on the form of payment, the Authorization to Release Information form, and the Limited Insurance Agreement form
  • Third Party COD Xpress QuickForm case – Date the Authorization to Release Information form and Variable Contract Acknowledgement form (if applicable) were signed by the client

Find out more about these changes from Prudential…

Prudential Introduces FlexGuard, a New Indexed VUL Product

FROM PRUDENTIAL…

We are excited to announce the introduction of a new addition to our life insurance portfolio and an entirely new category for Prudential!

FlexGuard Life indexed variable universal life (IVUL)—available on November 14—is an innovative, highly customizable life insurance product designed to meet the unique needs of individual clients. The first of its kind for Prudential in the new IVUL category, it offers more upside potential than traditional IUL products and more downside protection than traditional VUL options, with NEW buffered index strategies.

FlexGuard Life offers clients a combination of:

  • Protection: Life insurance death benefit protection with guaranteed duration options.
  • Growth: Multiple ways to grow cash values, including our unique index strategies that offer levels of downside protection.**
  • Access: Ability to access cash value with living benefits clients can use in the event of chronic or terminal illness.

Click to view FlexGuard Life IVUL fast facts

Key Features

  • A built-in 5-year No-Lapse death benefit guarantee with options to extend the duration for an additional cost.
  • Options to grow cash values—including innovative buffered index strategies.
  • A variety of ways to further custom-craft the policy, including the popular BenefitAccess Rider, and Overloan Protection Rider.

Click to register for a webinar focused on FlexGuard Life IVUL coming up on November 14th @ 11:00 Pacific | 2:00 Eastern

*Subject to state availability.
** Variable investment options do not offer protection levels.

Find out more about these changes from Prudential…

ProdMod: Prudential to Improve VUL Protector No-Lapse Guarantee Pricing

FROM PRUDENTIAL…

Starting August 15, VUL Protector no-lapse guarantee pricing will be improving (except in NY).

VUL Protector provides the same great protection, cash value accumulation potential, meaningful no-lapse guarantees, and diverse underlying investment options. Only now, the new pricing makes VUL Protector a more competitive option for clients looking to balance the security they need with the potential to build cash value.

What’s Changing

As an example, for $1M of Lifetime No-Lapse Guarantee Death Benefit the average decrease is roughly:

  • Single Pay Scenarios = 5% lower
  • 10 Pay Scenarios = 8% lower
  • All Pay Scenarios = 5% lower
(based on ages 45, 55, 65 and our top 4 underwriting classes)

Transition Rules

  • August 15, 2022 (Ready to Sell Date): New Rates for the repriced product are in effect. All applications signed and dated on or after August 15, 2022, will receive New Rates.
  • August 19, 2022 (Home Office Receipt Date): Last day that an application can be received in the Home Office with Old Rates.
  • October 28, 2022 (Placement Date): Last day that a pending case can be placed with old rates. All delivery requirements must be received in good order by end of business day (4 PM EST).
  • October 28, 2022 (1035 Exchange Date): Cases involving 1035 exchange must be initiated/started by October 28, 2022, to retain old rates. If the 1035 initiation/start deadline is met, the policy will not be subject to an additional placement deadline.

Prudential Updates Position on BGA Licensing Requirements

Don’t forfeit your Pru override compensation! Please review these important details from Prudential.

Prudential has updated its position and similar to many other Core Carriers has identified additional states that require IMOs and BGAs to be licensed and appointed in order to receive override compensation payments (referred to as “override states”). The list of states is expanding from three (MS, NY, and VA) to 16. This change impacts all BGA partners. AIN requires that Member Firms hold a non-resident state license in all states in which their business is written.

As a result, effective April 11, 2022, BGAs will need to be licensed and appointed for any policy placed in the following states in order to receive override compensation from Prudential: CA, FL, GA, Guam, KS, KY, LA, MS, NM, NY, PA, SD, TX, VA, WV, and WI.

All applications received will go through license validation checks. The first check will occur at the time of application submission and the second check will occur at time of policy issue. If the first check identifies a qualification deficiency, the BGA will be notified via a task labeled “BGA Licensing Alert” with the following message and will need to acknowledge this message in order to continue processing the application:

State law requires the BGA to be licensed and appointed to receive compensation on any policy placed in connection with this application. Please work promptly to obtain the necessary license and appointment. Failure to do so by time of policy issue will result in forfeited compensation for the BGA. As the BGA, you must acknowledge that you have received and understand this requirement and the resulting impact. Once you acknowledge, we will continue to process the application. If you need time to get appointed and licensed, do NOT acknowledge this until you are properly appointed and licensed and you are in receipt of an Appointment Confirmation Letter from Prudential.

Prudential’s Licensing, Appointment, and Registration Services team will be processing state appointments for all override states BGAs are currently licensed in. For any new licenses, please complete the “BGA Appointment Cover Sheet” and submit it to brokerage.appointment@prudential.com for processing.

ProdMod: Prudential Announces Retirement of Term Elite

FROM PRUDENTIAL…

Term Elite Is Retiring Effective November 22, 2021

In order to focus on the strength of our core term solutions, the Term Elite product will be discontinued as of November 22, 2021. Please note important dates to consider in relation to the retirement of Term Elite:

  • Monday, November 22, 2021
    • Retirement Date
    • Last day application can be signed and accepted
  • Sunday, November 28, 2021
    • Retirement Grace Period End Date
    • Date when paper app can be received in the Home Office (app must be signed by retirement date)
  • Friday, January 21, 2022
    • Placement End Date Policy placed

Find out more about these changes from Prudential…