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IV. The Life Insurance Products
Inter-American and Commonwealth both issue a virtually
identical conventional group term life insurance product known as
the millennium group 5 (MG-5) policy. Premiums on an MG-5 policy
are generally commensurate with the life insurance risk assumed
by the issuing company and do not present policyholders with
asset accumulation. The MG-5 policies allow policyholders to
convert their policies to 5-year level annual renewable term,
universal or whole life products which do not have any
accumulated value (or “conversion credits” as that term is
described below).
Inter-American and Commonwealth both issue a second
virtually identical innovative life insurance product known as
the continuous group (C-group) product. The C-group product is a
novel product designed by Inter-American (and later adopted by
Commonwealth) to masquerade as a policy that provides only term
life insurance benefits in order to make the product marketable
to targeted investors and to allow Inter-American to make life
insurance purchases from it more attractive than purchases from
its larger competitors. The C-group product is actually a
universal life product consisting of two related policies. The
first policy, the accumulation phase of the C-group product, is a
group term life insurance policy known as the C-group term
policy. The second policy, the payout phase of the C-group
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