A cap that President Barack Obama has proposed on the size of tax-advantaged retirement accounts is seen as potentially pushing savers to another product that limits payments to the government: life insurance.
The package arrived at Cindy Lohman’s home in Great Mills, Maryland, just two weeks after she learned that her son, Ryan, a 24-year-old Army sergeant, had been killed by a bomb in Afghanistan. It was a thick, 9-inch-by- 12-inch envelope from Prudential Financial Inc ., which handles life insurance for the Department of Veterans Affairs.
Jane Pierce spent nine years struggling alongside her husband, Todd, as he fought cancer in his sinus cavity. The treatments were working. Then, in July 2009, Todd died in a fiery car crash. He was 46. That was the beginning of a whole new battle for Jane Pierce, this time with Todd’s life insurance company, MetLife Inc.
New York Life Insurance Co., the insurer with a portfolio of more than $170 billion, limited the investment duration and hedged against higher yields to prepare for a rise in interest rates after U.S. bond buying ends.
U.S. life insurers are “very proud” of the retained-asset accounts that allow companies to hold death benefits and earn interest on the funds because the practice gives bereaved beneficiaries time to decide what to do with the money, an industry group said today.
Leon Black’s Apollo Global Management LLC private-equity firm and asset manager Guggenheim Partners LLC are betting they can make a windfall on annuities as insurers scale back from the retirement products.