I would like to present to you the insurance plans of Standard Life, which I will follow up by more articles about insurance offers of other major companies. In particular, I will talk about the company’s Universal Life and Term Life plans.

Universal Life:
You are eligible to sign up for the Universal Life up to your 81st birthday. Perspecta – as this planis called – has a plethora of intriguing features to offer, including the following: multiple death benefit, flexible monthly premiums and cost of insurance options.

The Perspecta investment accounts include: managed accounts, indexed accounts (including Strategic Asset Allocation), long-term deposit accounts, and a daily interest account. The plan also features an Account Optimizer and Shelter Optimizer which help safeguard the investment’s tax-exempt status. The policy has client bonus payments during the later policy years to further boost cash creation.

The plan has many available add-on options including: 10 and 20-year renewable and convertible term riders, critical illness riders for both children and adults, children’s term riders, the benefit of guaranteed insurability, accidental death benefit, and a disability waiver benefit which relieves you from paying premiums in case of your disability.

It is unfortunate, Standard Life insurance (which was renowned for its very low rates on its Universal Life plans) came with a significant rate increase across the board in 2005. Now, particular age groups may be inclined to switch to other providers because of this rate increase. As one of a few insurance companies in Canada, Standard Life still maintains preferred rates available on their plans, which perhaps compensates for their now higher rates overall.

For example, a $250~000 Universal Life plan will cost a 45-year-old non-smoker male client a minimum of $211.95 per month.

Term Life:
Standard Life, similar to many other providers, offers 10- and 20-year term plans named Term 10 and Term 20 respectively. Applicants can sign up for the Term 10 plan at any time between age 18 and 70, Term 20 ends at 65. Both policies can be renewed up to age 85 and the insured is allowed to convert them while they are 65 or less. Just like with Universal Life, the client can add many add-ons to the plan – please see above.

The term plan’s beneficiary can be the insured individual, or the plan may become payable on a joint first-to-die basis.
In case you have a very good health record (supported by your family’s superior health record), you may be awarded preferred rates. Even better, those in distinctly excellent health can get the super preferred rate. Super preferred or not, these term life plans are not available at face amounts lower than $100~000. If you don’t have enough spare income, then this minor fact may become an issue.

Canadian life insurance companies are lobbying the Canadian government to drive the accounting rules in their direction. In summary, insurance companies demand an amendment of the rules which our main regulator has already agreed to implement but wants to effect not before 2013.

The companies reason that the new order will implement too big volatility to the c/e figures in annual (or quarter-to-quarter) comparisons. Unfortunately, not only would this make the comparisons more challenging, but it would also stop comparisons to results prepared under the old standard.

LSM Insurance believes the the second one is weedy excuse though, as the insurance industry representatives would most possibly be needed to make new calculations for passed few periods’ statements applying the new regulations exactly for the aim of logical comparability, as is the case with most alternations of the standards. Nonetheless, a new set of rules will definitely come with more administrative power expenses in the time of the transition at the bottom end.

As to the instability of capital, the FP says that the insurers are asking for a 2-tier accounting rules that allows capital to be assessed based on a various set of standards than the IFRS. This makes sense because the sums of capital reserves are monitored and controlled by the Canadian regulatory body – OSFI. Should there be huge volatility of capital reserves, the the companies may be subdued to re-check the reserves more often which prevents ideal capital management.

In serious situations, substandard capital reserves may awake OSFI to consider an insurance company bankrupt. Today, it is unworkable to determine the exact effects of IFRS on c/e volatility, as the new rules are still before final completion by the International Accounting Standards Board (IASB). Nevertheless, the insurance companies are hoping that a 2-tier system, which is valid in the Anglo-Saxon countries will mitigate any such worries.

I would like to present to you several Canada’s life insurers in a few short articles, and I would like to open with Standard Life. So let us examine the Universal and Term Life policies which Standard Life is offering.

First off, Universal Life:
Standard Life’s Universal Life policy is for insureds up to 80 years of age. Their Universal Life policy, dubbed Perspecta, has flexible premiums, multiple death benefit and cost of insurance options.

The Perspecta investment accounts include: managed accounts, indexed accounts (including Strategic Asset Allocation accounts), term deposits, plus a daily interest account. In addition, Perspecta has a Shelter Optimizer and Account Optimizer, which maximize the return coming from premium investments by ensuring that they are exempt from taxation. When the policy matures, client bonus payments kick in to enhance cash creation even more.

To enhance the policy, you can choose from plenty of optional riders, such as: 10 and 20-year convertible and renewable term riders, critical illness riders for both children and adults, accidental death benefit, the benefit of guaranteed insurability, term riders for children and a disability waiver benefit.

Unfortunately, Standard Life insurance , once having industry-leading rates on its Universal Life policies, came with an increase in its pricing five years ago. The current rates aren’t very competitive among some age groups. On the bright side, the company still offers preferred rates on their Universal Life and Term Life policies, which is not that common these days.

For example, a 45-year-old non-smoking male will pay $211.95 monthly at least, as this is the minimum price that keeps the policy in force.

Term Life:
The term insurance policies of Standard Life are called Term 10 and Term 20. The Term 10 policy is aimed at applicants aged 18 to 70, and the Term 20 policyis aimed at applicants aged 18 to 65. Both policies can be renewed up to age 85 and an existing client may convert them while they are 65-years-old or less. The policies also let you to add a wide selection of add-ons, just like was the case with Universal Life (as described above).

The term policy’s beneficiary can be the insured individual, or the policy may become payable on a joint first-to-die basis.
Applicants in good health and have a good family health history can qualify for a preferred rate. If you are lucky to be in particularly superb health, you could even qualify for a super-preferred rate from the company. Super preferred or not, these policies are not available at face amounts under $100~000. This may be decisive for some applicants in case they are a limited budget.