LOMA Research Report Explores the Challenges Involved in Separate Accounts

ATLANTA, GA, December 13, 2004 -- The demand for separate account products has grown considerably in the past several years, according to a new report available from LOMA, entitled Management Challenges Involving the Separate Account Business.

“There are multiple factors in today’s marketplace that are driving the demand for separate account products such as variable annuities and variable life insurance,” said report author Stephen W. Forbes, Ph.D., FLMI, senior vice president of research at LOMA. “These factors include the number of individuals age 20-64, economic growth, an aging population in the U.S. , tax considerations, and regulatory factors such as the lack of a mandatory retirement age in the U.S. ”

Separate accounts in the life insurance industry involve products such as variable annuities and retirement savings plans, where most of the investment results are passed through to the customer. The report describes the nature of separate account products and the vehicles used by life insurers to fund these products, as well as the separate account financial risks that life insurers must manage and the related asset-liability management (ALM) challenges.

Topics in Management Challenges Involving the Separate Account Business include:

• An explanation of separate accounts

• The financial risk profiles of the life insurers managing the accounts

• The history, federal regulations and products involving life insurance separate accounts

• The characteristics of the marketplace for separate account products

• Financial management issues involving life insurance separate accounts

The 51-page LOMA report was written for financial, actuarial, marketing and other life insurance executives involved in managing products funded by separate accounts. The report is free for downloading by employees of LOMA member companies who are registered with the Members Only section of the LOMA Web site. A paper copy of the report is available for U.S. $125 (members) and U.S. $375 (nonmembers).

For more information, visit www.loma.org/IndexPage-Research.asp, telephone 770-984-3784, or e-mail orders@loma.org.