Life Insurance & Annuities

The major products of life insurers are life insurance and annuities.

In fact the primary business of life insurance companies is no longer traditional life insurance, but the underwriting of annuities, which are contracts that guarantee a fixed or variable payment over a given period of time.

Life insurance, which is sometimes referred to as life assurance, provides for a payment of a sum of money upon the death of the insured.

Life insurance can also be used as a means of investment or saving.

Life insurance was once sold primarily by career life insurance agents, who represented a single insurance company, and by independent agents who represent several insurers.

Today life insurance products are sold via a number of channels including mail, telephone, internet, banks, financial advisors, various organizations, in the workplace and directly to the public by the insurance company themselves.

Life insurance is both an insurance and investment industry.

• In excess of 275,000 life insurance policies are in force in the US.
• Life insurance companies pay out $1.5 billion every day.
• Life insurance companies invest $5.6 trillion in the US economy – including $268 billion in commercial mortgages – making them one of the largest sources of capital.

A life insurer divides its assets between two accounts that differ largely in the nature of the liabilities or obligations for which the assets are being held and invested. The general account supports contractual obligations for guaranteed, fixed-dollar benefit payments, such as life insurance policies. The separate account supports liabilities associated with investment risk pass-through products or lines of business, such as variable annuities, variable life insurance, and pension products. State laws allow assets in separate accounts to be invested without regard to the restrictions usually placed on the general account.

The Life Insurance industry model set consists of Enterprise, Business Area, and Data Warehouse logical data models developed for companies providing insurance products and services to the life and annuity insurance industry.

The Life Insurance industry models can be integrated with other ADRM Software financial industry models to support separate account investing activities.