Worksite Products in Today's Market - Southeastern Actuaries

109 Pages·2011·1.02 MB·English

Actuaries Club of the Southwest
Southeastern Actuaries Conference
Worksite Products in Today’s Market
November 16,, 2011
Presented byy:
Milliman, Inc.
TTaammppaa,, FFLL
Outline
• Overview of the Worksite Market
Michael Weilant, FSA, MAAA
•• LLiiffee WWoorrkkssiittee PPrroodduuccttss:: WWhhaatt'ss WWoorrkkiinngg
Sanjeev Chaudhuri, FSA, MAAA
• Critical Illness: A Core Product in Today's Portfolio
JJenniiffer ((OO''BBriien)) HHowardd, AASSAA
• Accident Insurance: An Essential Product
Nate Sandrowicz, ASA
• Short Term Disability: Where is it Headed?
Joshua Weber, FSA, MAAA
• Limited Benefit Medical: PPACA is a Game Changer
Darrell Spell, FSA, MAAA
• RReeiinnssuurraannccee:: SSmmaallll CCoovveerraaggee PPrroovviiddiinngg BBiigg VVaalluuee
Clark Himmelberger, FSA, MAAA
2 November 17, 2011
IImmppoorrttaanntt NNoottiiccee
The information in this presentation is general in nature. It is
nott iinttenddedd tto representt tthhe acttiions or assumpttiions off a
specific company and the information is not appropriate for
pricing, reserving, reviewing, or performing any other function
ssppeecciiffiicc ttoo aa ssiinnggllee ccaarrrriieerr.
TThhiiss pprreesseennttaattiioonn wwaass pprreeppaarreedd ffoorr tthhee ssppeecciiffiicc ppuurrppoossee ooff
providing a general overview of the worksite market and
products typically sold in that market. It is not appropriate for
anyy other ppurppose. Milliman does not intend to benefit anyy third
party recipient of its work product.
3 November 17, 2011
Overview of the Worksite Market
4 November 17, 2011
CChhaarraacctteerriissttiiccss ooff WWoorrkkssiittee IInnssuurraannccee
 Life and health insurance products
 Sold at the worksite
 100% employee paid through payroll
deduction
 Can be filed on an individual on group
cchhaassssiiss
 Can be called “worksite” or “voluntaryy”
5 November 17, 2011
WWoorrkkssiittee NNeeww BBuussiinneessss AAnnnnuuaalliizzeedd PPrreemmiiuumm
(in $ billions)
$6.0
5.4
5.2 5.2
5.0
$5.0 4.7
4.4
4.2
4.1
4.0
$4.0
3.5
3.1
$3.0
2.6
22.22
2.0
$2.0
$1.0
$0.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: Eastbridgge Consultingg
6 November 17, 2011
Worksite Takeovers as %% of New
Business Premium
45%
40%
41%
38%
35%
30%
29%
25%
200%%
15% 17%
10% 12%
5%
0%
2006 2007 2008 2009 2010
Source: Eastbridge Consulting
7 November 17, 2011
WWoorrkkssiittee IInn FFoorrccee PPrreemmiiuumm
(in $ billions)
$$3300.00
24.7 24.6
$25.0 Low Estimate High Estimate
22.9
20.7
1199.55
$20.0
17.7
16.6
18.8 18.7
15.0
17.4
$15.0 13.3
15.7
14.8
1100.33 1133.44
12.5
8.8
$10.0 8.0 11.3
7.0 10.0
6.2
8.5
7.3
$5.0 6.7
5.8
5.2
$0.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: Eastbridgge Consultingg
8 November 17, 2011
WWoorrkkssiittee MMaarrkkeett SShhaarree bbyy
Distribution Type
2%
9%
Benefit Brokers
15%
Career Agents
Classics
5522%%
Specialists
Occassional
23%
Source: Eastbridge Consulting
9 November 17, 2011
WWoorrkkssiittee GGrroouupp vvss. IInnddiivviidduuaall
Products
100%
90%
80%
54% 52% 51% 50%
7700%% 5599%% 5588%% 557%% 557%% 557%%
60%
50% Individual
GGrroouupp
40%
30%
46% 48% 49% 50%
20% 41% 42% 43% 43% 43%
10%
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: Eastbridge Consulting
10 November 17, 2011