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Traditional workplace benefits are no longer enough to meet the expectations of today’s employees and companies are racing to adapt their offerings to stay competitive in the changing market. That is the takeaway in new research from EY (Ernst & Young) and LIMRA.

With Gen Z now outnumbering baby boomers in the labor force, and millennials making up the largest demographic overall, more than half of small employers surveyed and two-thirds of large ones expect to offer more benefits over the next five years.

The 2025 Workforce Benefits Study surveyed 800 U.S. employers and 2,000 workers, painting a clear picture: employers continue to face cost pressures, compliance burdens, and a workforce that spans five generations. Most employers—84% overall and 95% of large firms—believe benefits are essential to attracting talent. However, the majority also recognize that their current one-size-fits-all approach is outdated.

Yet rising medical costs, compliance demands, and a lack of digital tools are making it harder to scale those offerings effectively.

As of 2024, Gen Z – sometimes called Zoomers – officially outnumbers baby boomers in the workforce, with millennials being the largest generational cohort. Gen Z represents those born between 1997 to 2012. This shift has elevated demand for benefits tied to wellness, flexibility, and financial security. Employees increasingly want emergency savings programs, student loan repayment assistance, and mental health benefits—all of which are now climbing the ranks of must-have offerings.

“Benefits absolutely remain at the heart of the employee value proposition,” said Chris Morbelli, EY Americas Life & Group Insurance Transformation Leader “Even with 53% of employers citing benefits cost as one of their top concerns, 57% of small employers and about 65% of mid-to-large employers expect to offer more benefits in the future. Wellness benefits are becoming a must have.”

‘Core four’ benefits expand to add leaves

Paid family and medical leave have now joined medical, dental, and vision coverage in the so-called ‘core four’ of benefits, with 71% of employers naming them as essential. However, interest in these benefits varies widely across generations, causing a more nuanced, customizable approach, the EY-LIMRA survey said.

Amid this complexity, brokers are playing an increasingly consultative role, helping employers navigate a fragmented regulatory environment while advising on holistic, data-driven strategies. Employers rank data on employee preferences, utilization rates, and cost trends as top decision-making tools—and brokers are eager to deliver.

But ongoing consolidation in the brokerage world could stifle local innovation and leave small businesses underserved. This may open the door for general agencies and professional employer organizations (PEOs) to gain market share, especially in the small to midsize employer segments.

Leave benefits are growing rapidly in scope and importance, but most employers are still playing catch-up when it comes to managing them. Only 24% of workers who took leave said the process was ‘very easy,’ revealing a considerable experience gap.

“Leave management is now a core four benefit with medical, dental and vision,” said Morbelli. “But the regulatory environment is rapidly getting more complex, making administration even more complex, which is quickly opening the door for leave mismanagement. 79% of employers said they did not view leave management to be very complex in 3-5 years, yet only 24% of employees said their leave experience was “very easy” today.”

Employers are responding by considering a broader array of leave types—from caregiving to sabbaticals—and increasingly outsourcing administration to third-party providers and carriers that offer integrated solutions. As one broker noted, “I’ve seen more leave of absence cases in the last 12 months than in the prior nine years combined.”

Digital tools now expected

The study confirms that digital tools are not just nice-to-have—they are expected. Employers are prioritizing seamless online enrollment, mobile access, and claims automation. AI is emerging as a momentous change, especially in claims adjudication, personalized benefit recommendations, and real-time decision support.

“AI has the potential to orchestrate more personalized experiences at scale in several impactful ways,” said Morbelli. “It can create new product designs tailored to microsegments, or the ability to quickly test next generation offerings. AI can also expand distribution reach and proactively target underserved market segments. Additionally, it can enhance education efforts to demystify benefit options and deliver deeper insights into overall wellbeing. Decision support tools can be augmented to highlight generationally relevant needs and offerings, while ongoing servicing and claims processes can be transformed through digital agents and real-time decisioning.”

By 2025, 74% of employers said they prefer carriers that integrate well with existing tech platforms over those simply offering the lowest cost. The message is clear: integration and experience now outweigh price alone, the study concluded.

The 2025 Workforce Benefits Study makes one thing plain: the benefits landscape is undergoing a seismic shift. The winners will be those who embrace digital tools, leverage AI for personalization, and build benefit portfolios that reflect the diverse needs of a multigenerational workforce.

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The LIMRA and LOMA merger with the Alliance for Lifetime Income is finalized, and a new advisory board is in place.

Rebranded as the Alliance for Lifetime Income by LIMRA, the program will “continue its mission to engage and educate consumers, financial professionals and policymakers about the importance of including protected lifetime income in their retirement planning,” LIMRA said in a news release.

ALI was founded in 2018 to help consumers and financial advisors better understand the importance of protected income in retirement. Over the years, ALI has developed creative, successful public-facing campaigns that educate consumers about retirement risks and the value of annuities.

In particular, the fledgling association secured the sole sponsorship of The Rolling Stones’ 2019 “No Filter” U.S. stadium tour, which continued in 2021 after a COVID-19 break. ALI also trademarked “Peak65,” a catchy moniker to emphasize that more than 4.1 million Americans will turn 65 each year through 2027, or roughly 11,200 every day.

LIMRA announced the ALI transaction in June. As part of the transition, LIMRA has established an executive advisory board, comprised of industry leaders, to help guide the next chapter of the organization.

“This transaction underscores LIMRA’s commitment to advancing retirement security by educating consumers and advisors about the value of the financial protection our members’ products provide,” said David Levenson, president and CEO of LIMRA and LOMA. “With 11,000 Americans turning 65 each day, there’s never been a more important time for this work.”

In August, LIMRA appointed Jennifer Burlingame, managing director and head of Global Retirement and Insurance Enterprise Strategic Relationship Management, Prudential Financial, as chair of the new advisory board in 2026. Thirty-one additional executives from annuity manufacturers, distributors, consulting firms and trade associations have joined the advisory board.

“It’s an honor to chair the new executive advisory board, comprised of talented leaders from across the industry who share the same goal of helping people achieve financial security in retirement,” Burlingame said. “The Alliance for Lifetime Income by LIMRA will focus its efforts to educate consumers and advisors about the importance of creating protected income in retirement. With people living longer and not necessarily saving for a longer retirement there is a critical need for this education. I’m confident that this organization will help build a stronger, more financially secure future for many Americans.”

LIMRA also hired Suzy Jacobs as head of consumer and advisor strategy. Previously, Jacobs was chief operating officer at Finseca. In this new role, she will help LIMRA expand its marketing and communications efforts to reach financial professionals and consumers, building greater awareness of annuities’ role in retirement financial security, the release said.

Jacobs reports to LIMRA and LOMA Chief Marketing Officer Tina Beckwith.

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The Trump administration is appealing a ruling last month that blocked several parts of its recent changes to Affordable Care Act exchange enrollment and eligibility.

In addition, defendants, which include the Department of Health and Human Services, HHS Secretary Robert F. Kennedy Jr., Centers for Medicare & Medicaid Services, and CMS Administrator Mehmet Oz, also asked the Maryland federal court for a stay of its Aug. 21 ruling until the appeal is heard.

“While the Court’s Stay Order will undoubtedly hamstring … [HHS] efforts to address legitimate concerns about improper enrollments in Exchange plans that are subsidized by taxpayers, the Court’s preliminary stay of the Rule’s actuarial value policy will be especially harmful to the government and to the millions of consumers who obtain health care coverage through Exchanges,” government attorneys wrote in the appeal filed Friday.

In a lawsuit filed July 1, plaintiffs – a coalition of Democratic mayors, liberal advocates and physicians – challenged nine provisions of the CMS “Marketplace Integrity and Affordability” rule. CMS rolled out the rule in June, claiming that it would lower individual health insurance premiums by about 5% on average.

It is also projected to save taxpayers up to $12 billion in 2026 by “combating the surge of improper enrollments in the [ACA],” the CMS said in a news release. The rule includes a shortened enrollment period, more stringent income verification checks, and a $5 fee for some people who automatically re-enroll in a free plan.

APA violations alleged

Filed in the U.S. District Court for the District of Maryland, the lawsuit alleges violations of the Administrative Procedure Act.

The rule would result in more than 2.2 million Americans losing their health coverage, claimed Democracy Forward, the liberal advocacy group leading the litigation.

In his ruling, Judge Brendan A. Hurson found that plaintiffs “met their burden of showing that there is a strong likelihood that they will succeed on the merits of their challenges to seven provisions” of the rule.

Plaintiffs did not meet the burden of proof on two remaining provisions of the rule, the judge added.

One of the rules stayed by Hurson “adjusts the allowable ranges of actuarial values applicable to the different health care plan types offered on Exchanges under the” ACA, the government appeal explained.

HHS estimated that roughly 80% of issuers participating in federally facilitated exchanges took advantage of that policy by designing health plans that fall within the expanded “de minimis” ranges of allowable actuarial values, the appeal said.

“Yet as a result of the Court’s Stay Order, all of those issuers will now need to revise those plans to comport with the narrower ‘de minimis’ ranges that applied under the pre-Rule regulatory scheme,” the appeal added.

HHS and state agencies will then need to review and approve those revised plans before 2026 open enrollment begins on Nov. 1, the appeal said.

“And if issuers are unable to comply with this abrupt regulatory change, or if their plans are not approved in time, Exchange customers will have fewer plan options to choose from,” government attorneys wrote. “Such a sudden and severe disruption to the Exchange marketplace could have a devastating effect” on availability.

Most-contested provisions

Hurson temporarily blocked most of the contested provisions of the rule, including:

• A $5 fee for low-income individuals auto-enrolled into ACA plans who fail to verify their eligibility.
• Stricter eligibility verification requirements which could make it harder for people to qualify for coverage.
• A provision allowing insurers to deny re-enrollment to individuals with unpaid premiums.
• Exclusion of gender-affirming care from essential health benefits.

Elements left untouched by Hurson’s ruling include: modifying how cost-sharing limits are calculated or changes affecting the 60-day reconciliation extension window.

Plaintiffs include the mayors of Baltimore, Chicago and Columbus, Ohio and a pair of liberal groups: Doctors for America and Main Street Alliance.

© Entire contents copyright 2025 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.

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Life insurance sales for the second quarter topped $2.9 billion, up 8.5% compared to the previous quarter and up 2.6% compared to the same period last year, Wink, Inc. reports.

Strong sales of indexed life led the way, said Sheryl Moore, CEO of Wink and Moore Market Intelligence.

“Most of second quarter had a steadily-rising market, which lent well to sales of indexed life,” Moore said. “It was the second-best quarter for sales of these index-linked products.”

All life sales include fixed universal life (UL), indexed UL, variable UL, whole life, and term life product sales.

Noteworthy highlights for all life sales in the second quarter included Pacific Life Companies ranking as No. 1 in overall sales for all life sales, with a market share of 5.6%. Transamerica Life’s Financial Foundation IUL II, an indexed universal life product, was the No. 1 selling product for all life sales, for all channels combined, for the quarter.

All universal life sales for the second quarter were over $1.1 billion, up 5.9% compared to the previous quarter and up 4.4% compared to the same period last year. All universal life sales include fixed UL, indexed UL, and variable UL product sales.

Noteworthy highlights for all universal life sales in the second quarter included Pacific Life Companies ranking as No. 1 in overall sales for all universal life sales, with a market share of 11.1%. Transamerica Life’s Financial Foundation IUL II, an indexed universal life product, was the No. 1 selling product for all universal life sales, for all channels combined, for the quarter.

Non-variable universal life sales for the second quarter were $897.5 million, up 5.8% compared to the previous quarter and up 5.9% compared to the same period last year. Non-variable universal life sales include both fixed UL and indexed UL product sales.

Noteworthy highlights for total non-variable universal life sales in the second quarter included National Life Group retaining the No. 1 overall sales ranking for non-variable universal life sales, with a market share of 14.5%. Transamerica Life’s Financial Foundation IUL II, an indexed universal life product, was the No. 1 selling product for non-variable universal life sales, for all channels combined, for the quarter.

Fixed universal life sales for the second quarter were $69.8 million, down 12.7% compared to the previous quarter and down 30.5% compared to the same period last year.

Items of interest in the fixed UL market included Nationwide retaining its No. 1 ranking in fixed universal life sales, with a 20.3% market share; Prudential, Pacific Life Companies, John Hancock, and Thrivent Financial completed the top five, respectively.

Nationwide’s Nationwide CareMatters II was the No. 1 selling fixed universal life insurance product, for all channels combined, for the third consecutive quarter. The top primary pricing objective of no lapse guarantee captured 36.9% of sales. The average fixed UL target premium for the quarter was $7,742, an increase of nearly 15% from the prior quarter.

Indexed life sales for the second quarter were $829.7 million, up 7.7% compared with the previous quarter, and up 11% compared to the same period last year. Indexed life sales include both indexed UL and indexed whole life.

Items of interest in the indexed life market included National Life Group keeping its No. 1 ranking in indexed life sales, with a 15.6% market share; Transamerica, Pacific Life Companies, Nationwide, and John Hancock rounded out the top five, respectively.

Transamerica Life’s Financial Foundation IUL II was the No. 1 selling indexed life insurance product, for all channels combined, for the second consecutive quarter. The top primary pricing objective for sales in the quarter was Cash Accumulation, capturing 73.3% of sales. The average indexed life target premium for the quarter was $12,917, an increase of more than 8% from the prior quarter.

Variable universal life sales for the second quarter were $292.2 million; up 6.4% compared with the previous quarter and up 0.2% compared to the same period last year.

Items of interest in the variable universal life market included Prudential retaining the No. 1 ranking in variable universal life sales, with a 28.9% market share; Pacific Life Companies, John Hancock, Nationwide, and RiverSource Life completed the top five, respectively.

Pruco Life’s VUL Protector was the No. 1 selling variable universal life product, for all channels combined for the sixth consecutive quarter. The top primary pricing objective for sales this quarter was cash accumulation, capturing 59.3% of sales. The average variable universal life target premium for the quarter was $27,661, an increase of nearly 14% from the prior quarter.

“Like indexed life, the market’s performance supported increasing sales of VUL,” Moore said. “We are anticipating an increase in sales for third quarter as well.”

Whole life second quarter sales were $1.1 billion, up 11.9% compared with the previous quarter, and up 4.8% compared to the same period last year.

Items of interest in the whole life market included the top primary pricing objective of final expense, capturing 76.5% of sales. The average premium per whole life policy for the quarter was $5,086, an increase of more than 7% from the prior quarter.

Term life second quarter sales were $622.9 million, up 7.7% compared with the previous quarter and down 4.3% compared to the same period last year.

Items of interest in the term life market included Prudential ranking as No. 1 in term life sales, with a 5.9% market share. Pacific Life Companies, Protective Life Companies, Corebridge Financial and National Life Group completed the top five, respectively.

Pruco Life’s Term Essential 10 was the No. 1 selling term life insurance product, for all channels combined, for the quarter. The average annual term life premium per policy reported for the quarter was $2,498, an increase of more than 17% from the previous quarter.

Wink now reports sales on all annuity lines of business, as well as all life insurance product lines, Moore noted.

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Concerns about global trade and tariff changes are adding to the financial pressures that many American retirees are facing. According to the 12th edition of the Nationwide Retirement Institute’s Social Security Survey, half of retirees are terrified about the impact of tariff changes on their retirement income or savings, and 63% believe these rising tariffs will drive inflation beyond what Social Security Cost-of-Living Adjustments (COLAs) can cover.

These concerns about tariffs and inflation are occurring when many current Social Security recipients are already struggling to make ends meet. For example, the survey said, 61% of those who took part in the survey said that missing even half of a Social Security payment would leave them unable to survive financially, and 55% said that their benefits don’t cover their basic needs in retirement. As a result, many have been forced to make tough financial trade-offs, with 52% cutting back on discretionary spending, 31% reducing essential expenses, and another 31% relying more heavily on their savings or retirement accounts.

Managing fears about tariffs, inflation

To manage these concerns and fears about tariffs and inflation, Americans said that they are open to receiving help from financial professionals as they plan for various income streams in retirement.  For example, the survey found that 58% of U.S. adults are interested in speaking to a financial professional to help them manage or navigate potential cuts to Social Security benefits in the future.

And nearly four in five individuals who currently work with or plan to work with a paid financial advisor said that they would be likely to switch to another paid advisor if theirs couldn’t help them maximize their Social Security benefits.

Low knowledge level of Social Security benefits

This need for help in managing benefits should not come as a surprise. According to the survey, only 38% of Americans said they are confident in their knowledge of the program. And just 21% of all respondents were able to correctly identify the age at which they are eligible to receive full Social Security benefits. When asked to respond to 15 true-or-false questions about Social Security, the average respondent knew only eight correct answers.

Adding to the challenge, nearly one in five (19%) current Social Security recipients said that it has become more difficult to access or manage their benefits in 2025, This signals a system that’s not only misunderstood, but also increasingly complex to navigate without professional help, the survey said.

Why the knowledge gap?  

So, why do so many Americans know so little about Social Security benefits?  As Tina Ambrozy, SVP, Nationwide Financial Strategic Customer Solutions explained it, the financial services industry has done a great job in helping American workers understand the importance of saving and investing for the future, but that singular focus has left a gap. Many have put very little thought into what comes after they cross the retirement threshold.

“Our research shows that too many investors are on autopilot when it comes to thinking about Social Security, overlooking how it fits into a broader retirement income strategy,” added Ambrozy. “We’ve missed opportunities to help them think about creating a plan to strategically use their assets in retirement – how much to withdraw, in what order (e.g., taxable vs. tax-advantaged accounts), and how to make savings last.)”

A key part of that includes understanding the role Social Security will play in their personalized plans, Ambrozy added. “That’s where a financial professional can add real value: clearing up misconceptions, addressing knowledge gaps and creating a holistic plan that will help their clients approach retirement with more confidence,” she said.

Helping your clients address their concerns

So, what are some of the components of a plan that is designed to help clients protect their income and secure a more stable future?  Financial professionals have a tremendous opportunity to build stronger relationships and demonstrate value with their clients by helping them break down Social Security, their strategy for claiming it, and how it will fit into their overall plan for retirement income, said Ambrozy.

“The first step is to start the conversation by proactively introducing the topic, as opposed to waiting for the client to bring it up,” Ambrozy said. “Next,” she added, “guide clients through the basics of Social Security, address any misconceptions and ensure they have a clear view of how it fits into their retirement picture. There are important opportunities to help them coordinate strategies for retirement income and taxes to improve efficiency and reduce surprises.”

Advisors should also meet their clients where they are, offering guidance that reflects their life stage and goals, Ambrozy added. “For example, older clients may need assistance with filing logistics and timing, while younger clients may want additional education and scenario modeling to help them envision how Social Security may fit into their long-term financial plan,” she said.

For more insights on this survey data and Americans’ concerns about tariffs and inflation, see the Advisor Advocate Blog or view this infographic.

The research was conducted online by The Harris Poll on behalf of Nationwide among 1,812 adults age 18+ who currently receive or expect to receive Social Security (“national sample”). These include 301 Gen Z (age 18-28), 504 millennials (age 29-44), 505 Gen Xers (age 45-60), and 502 Boomers+ (age 61+).  The survey was conducted from June 2-17, 2025.

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According to a CFP Board research report, Steering Clear of Financial Misinformation: A Survey of Americans, more people are turning to the internet for financial advice. As a result, nearly 3 out of 5 people said that they’ve made regrettable financial decisions that are based on misleading information they received online

Even with the vast availability of financial content online, fewer than 2 in 5 Americans believe this information is in their best interests. Also, the survey pointed out, more than three in five Americans now spend more time verifying information than they did five years ago.

Harmful effects of misleading information

Misleading financial information does not just confuse, it costs people money as well, the survey said. For instance, nearly two out of five Americans (39%) have lost $250 or more because of bad advice, and almost 1 in 5 (18%) have suffered losses that amount to more than $1,000. While some have narrowly avoided these pitfalls — one in five reconsidered questionable advice before acting on it — many are dealing with lasting effects.

Among those with regrets, common consequences include:

• Delaying major financial decisions (33%)
• Acting without professional input (29%)
• Incurring unnecessary fees (28%)
• Sharing inaccurate information with others (28%)

As Kevin Roth, Ph.D., managing director, Research, at CFP Board, added, “when consumers rely on misleading financial information, they’re less likely to achieve their financial goals, delaying major decisions like buying a home or retiring, and fueling anxiety about their financial future.”

More negative effects

Brian Haney, CEO of The Haney Company, provided some additional consequences of misleading financial information.  “Like misleading information of any kind,” Haney said, “acting upon it without the benefit of understanding not just the information, but the impact of improper application, the consequences are often bigger than we recognize. Not getting the right amount of life insurance is serious financial harm to loved ones if someone dies. Using the wrong information to construct an investment portfolio can lead you to market losses you were likely not prepared for. When it comes to our money, small mistakes can sometimes have grave consequences, so, the need for financial professionals to be engaging more effectively on the front lines of where consumers are seeking answers could not be more critical.”

Younger Americans more apt to be misled

The research also pointed out a generational divide in both trust and the consequences of misleading information. Nearly half of Americans aged 25-45 believe that online financial content serves their best interests, almost double the rate of those aged 46-64 (25%). Younger adults are also more likely to act on misleading information, with 64% reporting regrettable decisions, compared to 45% of those who are aged 46-54.

And why are younger adults more likely to act on misleading information than their older counterparts? “Younger Americans are more than twice as likely than others to turn to social media for financial advice, and they’re more likely to trust what they find,” explained Roth. “Many rely on platforms like Instagram, TikTok and X, making them especially vulnerable to misleading information.”

In addition, according to the survey, only 33% of younger Americans have entirely avoided mistakes from online financial advice, compared to 54% of older adults. This generational gap extends to sources of financial guidance as well. Younger respondents are nearly twice as likely to trust financial advice from artificial intelligence (44% vs. 26%) and guidance found on social media (44% vs. 24%).

“Consumers who rely on misleading financial advice risk paying unnecessary fees, getting locked into the wrong financial products or, even worse, delaying major goals like buying a home, funding their children’s college or retiring,” Roth explained.

Haney added that those generations who have been raised immersed in technology naturally have a higher degree of trust in what that technology can offer to them. Unfortunately, he said, this level of comfort can lead many to be unduly influenced by information that they do not yet have the capability to more properly interpret.

“When Amazon can deliver things to your front door in a day, or when YouTube can help you fix your toilet, it’s easy to understand why advice of all kinds, including financial, could be helpful,” added Haney.  “I consider this era “the illusion of wisdom,” where the mere fact that we have access to information at the touch of a keyboard gives us the false sense of security that we are somehow better informed and better able to “do things ourselves.”

However, Haney pointed out, behavioral psychology shows that this overwhelming amount of information does not lead us to make better decisions, because not having information was never really the issue.  “It’s knowing how to properly interpret that information and apply it to your unique and specific situation is what I consider wisdom.  This is the perfect place for financial professionals to operate – in the gap between information overload, and DIY – to bridge that knowledge gap by empowering Americans with the expertise needed to move forward financially,” he said.

Working with clients

Haney also shared some of the steps that advisors can take to help guard their clients from relying on and acting on misleading online financial information. Advisors need to lean into what is already happening by cultivating a skillset of curiosity, he said. They need to become better at engaging more frequently with their clients and prospects to understand where they like to consume their financial information (what places and media they use), and what they find the most impactful from those sources.

“Use your interests to create better dialogue, one where the advisor is a partner helping people interpret information in order to properly apply it to their situation,” he said.

The survey pointed out that amid growing digital misinformation, most Americans trust financial advisors like CFP professionals. In fact, three in four Americans said that they feel confident when following their financial advisor’s advice without needing further verification.

Read the full Steering Clear of Financial Misinformation: A Survey of Americans report. From April 7-8, 2025, CFP Board’s Research Team sent a 13-question survey to randomly selected Americans aged 25 and 64 nationwide, as sourced by Alchemer. The survey generated 1,044 responses, the data from which serves as the basis of this report.

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Allianz Life Insurance Co. of North America faces several lawsuits related to a July data breach that affected 1.4 million people.

The lawsuits, filed in the District of Minnesota federal court, all claim that the insurance giant failed to treat plaintiffs’ personal data with proper security measures. Allianz Life is headquartered in Minneapolis.

In a late-July regulatory filing, Allianz reported that hackers stole the personal information of the majority of its customers, financial professionals, and select Allianz Life employees in the United States.

The data breach, described by Allianz as a hack, occurred on July 16 and was discovered on July 17, the filing said. The breach allegedly exposed personally identifiable information, including Social Security numbers, financial and health information stored in an unencrypted database.

Had Allianz “employed basic, long-established, and recommended security tools, the Data Breach should have been easily thwarted,” stated Michael Roaldi, of Holmes Beach, Fla., and Beth Satterthwaite, of Virginia Beach, Va., in their lawsuit filed Aug. 13. “However, Defendant did not employ best practices for data security.”

A spokesman for Allianz said the insurer does not comment on litigation. The insurer told Reuters in July that it notified the FBI and, based on its own investigation, that there is no evidence that the Allianz Life network or other company systems were accessed, including their policy administration system.

‘A scheme to gain access’

One of the cases filed in Minnesota over the past six weeks is the Roaldi-Satterthwaite lawsuit, in which the plaintiffs seek class-action status. It is likely the lawsuits will eventually be consolidated into one action for the class.

Plaintiffs point out studies, reports, and advice Allianz released over the past decade concerning cybersecurity risks.

“Allianz has stated that the breach was due to [a] ‘social engineering technique’ that often involves a scheme to gain access,” the lawsuit states. “Even though Allianz has stressed (at least as early as 2015) the ten steps a company should take to protect itself, Defendant did not sufficiently secure its own system and/or ensure that any CRM system was properly vetted for cybersecurity.”

Roaldi and Satterthwaite seek “declaratory and injunctive relief, monetary damages including punitive damages, equitable relief, and all other relief authorized by law.”

Class certification reversed

In other court news, Progressive Direct Insurance Co. won a victory Monday when the Fourth Circuit Court of Appeals reversed class certification in a lawsuit over vehicle valuations.

The Fourth Circuit reversed the district court’s decision to certify a class on behalf of policyholders who alleged that Progressive Direct underpaid them for totaled vehicle claims.

The appellate court found that the plaintiff lacked the required concrete injury. She had received a payment from the insurer, was not out-of-pocket beyond her deductible, and did not prove that her vehicle’s value exceeded the amount she was paid, court documents say.

Even if standing had been established, the court found that class certification was inappropriate. Determining whether Progressive breached its obligation to pay “actual cash value” would require individualized analysis of each claimant’s vehicle and circumstance—thus failing Rule 23’s requirements of commonality and predominance.

Progressive, as well as other leading vehicle insurers, has been the target of multiple class-action lawsuits regarding its valuation methods for crashed and totaled vehicles, particularly its alleged practice of artificially lowering the actual cash value (ACV) offered to customers.

The Fourth Circuit decision to reverse class certification follows a similar July 23 decision from the Seventh Circuit in a separate lawsuit challenging totaled vehicle values.

© Entire contents copyright 2025 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.

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Choosing the right accounts to save into can help younger and lower-asset households, according to a recent report by Hearts & Wallets.

“Saving allocation across account types is an important financial decision with long-term consequences,” Amber Katris, Hearts & Wallets subject matter expert, said. “Opting for too much in retirement accounts can result in households struggling to achieve other goals like buying a house or paying for college. The data identify the importance of saving and into which accounts, especially for lower-asset and younger households.”

According to the report, 132.2M U.S. households controlled $88.2 trillion of investable assets, representing 58% of household wealth, as of year-end 2024. Within this $88.2 trillion, a 2-to-1 taxable-retirement split occurs at the national level, with $56.2 trillion in taxable accounts and $32.1 trillion in consumer-controlled retirement accounts.

Investable assets are the leading component of total household wealth of $150.8 trillion, according to the report. This is followed by net equity in real estate (No. 2 at $34.7 trillion or 23%), and private business and promised future DB pension benefits. In percentage terms, net equity in real estate has grown in relative importance to other components of household wealth, up from 17% in 2015. Of the 4 components, net equity in real estate is also growing the fastest–at a 7-year CAGR of nearly 14%.

“Financial services firms should ensure advice and investment solutions are as robust for taxable accounts as for retirement,” Laura Varas, CEO and founder of Hearts & Wallets, said. “Furthermore, beyond investable assets, real estate should be an important aspect of advice since many households have equity in their homes and other real estate that is equal or greater than their investable assets.”

Household awareness of allocation of savings across account types is on the rise, the report said. At the national level, bank savings/certificates of deposit (CDs) account types are the most common destinations for saving, used to some degree by 55% of households, followed by employer-sponsored retirement plans (ESRPs) and IRAs. These are used by 42% and 30% of households, respectively. The 5-year trend at the national level shows a rising incidence of saving into ESRPs and IRAs, both up 5 percentage points, and bank savings/CDs, up 4 percentage points.

The importance of knowing how to save

So, why is knowing how to allocate savings so important, especially for lower-asset households? Hearts & Wallets believes that saving assets into the right type of account is an important question, said Varas. Fortunately, consumers are starting to become much more aware of how they allocate their savings.

Household awareness of allocation of savings across account types – an important financial decision about which little advice is currently available – is rising, Varas pointed out. Two thirds (67%) of households today save annually and know how they allocate their savings across account types, up 7 percentage points from 60% in 2019. Average portfolio allocation by account type varies with household assets. Taxable brokerage grows in importance with assets. ESRPs, commonly known as defined contribution (DC) plans, are very important on the lower end.

At the national level, bank savings/CDs account types are the most common destinations for saving, used to some degree by 55% of households, followed by ESRPs and IRAs, used by 42% and 30% of households, respectively, Varas said. On average, households that know their savings allocation devote 40% of savings to bank accounts/CDs and 40% to retirement accounts (ESRPs/DC and IRAs).

Lower-asset households put far less of their savings into taxable brokerage than higher-asset households. The opposite pattern is true for bank savings/CDs, where lower-asset households put 40% to 50% into these accounts, and the $3 million-plus households put less than 20%.

“ESRPs become an important destination for saving at around $75,000 to $100,000 in investable assets and remain an important destination until you get to households with higher assets,” Varas added. “For higher-asset households, most of their dividends and gains are in taxable brokerage.”

The consequences of savings allocation

Looking across asset segments, lower-asset households are putting most of their money into bank savings or CDs, added Varas. They are compounding this problem of not getting any exposure to equity. “They’re getting 4% in interest, which feels like a lot when you are used to getting 0 in the prior rate environment. But it’s not going to fuel their growth to wealth the way other asset classes do,” she pointed out.

Another big mistake that many households make is allocating much of their savings to retirement accounts to take advantage of the current tax breaks. “Tax breaks are great, but households often find themselves hamstrung when they want to use savings toward other goals, like college, a home purchase or other important objectives,” Varas said.

“You often can’t withdraw money from retirement accounts to fund other goals, or you’re limited in the amount you can withdraw, until you hit a certain age,” Varas pointed out. “Those barriers impact lower-asset households even more than higher-asset households because lower-asset households have fewer overall savings to draw from to meet their goals and needs. If you have children who will be attending college, allocating some savings to 529s can help build the nest egg to support your children’s education as well as provide tax breaks. If most of your savings were allocated to retirement accounts, you’re going to have tax consequences for early withdrawal from your retirement accounts to fund college. I personally made this mistake.”

Helping lower-asset clients make wise decisions

It is very important to cover the topic of savings allocation in financial- advice experiences, said Varas, in pointing out some of the steps advisors can take to help their lower-asset clients make wise decisions about allocating their savings. “It’s devilishly complicated, but getting the right assets into the right accounts can have a huge impact on the well-being of households.,” she added.

“Within the Hearts & Wallets Inside Advice® Database,” Varas pointed out, “we find that only 9% of advice experiences fully address savings allocation. Fully addressed means providing a specific recommendation about how much to save, into which account, after a detailed process with the capability to show a start date for an increase in saving when there’s a time-limited spend like college or insurance premiums end.”

“Even in the very best experiences we’ve seen,” Varas added, “only 34% of them fully address savings allocation. This is an important area that we encourage everyone in the industry to keep working on. And make sure your advice, experiences and investment solutions are as robust for taxable accounts as they are for retirement.”

The wealth tide is rising, and it is rising for a lot of boats, Varas pointed out. “But it’s not rising for all boats, especially for lower-asset households who don’t have much exposure to equity markets. More advice about saving allocation will help to address this.”

The Portrait of U.S. Household Wealth 2025: A Closer Examination of the Increase in Investable Assets and Household Finance provides the foundation for sizing U.S. retail investors and is based on government data and the Hearts & Wallets Investor Quantitative Database. The latest wave was fielded from July 17-Aug. 9, 2024, with 5,989 households

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A new Jackson National Life Insurance study exposes a surprising truth: Risk-averse investors may be vulnerable to a different form of market risk — the risk of low long-term returns. The research, the fourth installment in Jackson’s Security in Retirement Series research, was conducted in collaboration with the Center for Retirement Research at Boston College.

To better understand market risk exposure, Jackson developed the proprietary Market Risk Vulnerability Index (Index). This tool helps evaluate investors’ financial positioning against five key benchmarks:

• Spending
• Savings
• Cash allocation
• Stock-bond split
• Diversification

Based on how many of the benchmarks they met, investors were scored as low-index (least vulnerable to market risk), medium-index, or high-index (most vulnerable to market risk).

The index revealed that:

• 57% of high-index investors spend over 50% of their income on basic needs, compared to just 5% of low-index investors.
• Only 4% of high-index investors meet the recommended stock allocation, leaving them ill-prepared for long-term growth.
• High-index investors are more than twice as likely as low-index investors to cite longevity risk as a major concern (56% vs. 27%); yet, they are less likely to have a plan in place to address it.

Additional key findings from the study include:

• Widespread financial vulnerability. The Jackson report highlights significant financial vulnerability among investors who are nearing or are in retirement. For example, approximately 30% of the survey respondents reported investable assets between $100,000 and $299,999. Many investors fail to meet key benchmarks of general financial health such as appropriate cash allocation, retirement savings targets, or asset diversification, with only 14% of high-index investors meeting the recommended asset diversification benchmark.
• Risk-averse investors face heightened risk exposure. Investors in the study who describe themselves as unwilling to take risks are among the most vulnerable to the market risk of not realizing potential investment gains. These individuals often hold excessive cash positions — with their ideal cash holdings averaging 49% of total assets, more than double the recommended 20% threshold — and lack diversification. Such behaviors, while cautious on the surface, may leave these investors in a disadvantaged position. High cash holdings can minimize gains during market upswings, and a lack of diversification can leave investors more exposed to market volatility during downturns.
• Diversification is too often cited as a tactic to protect against market risk. But while diversification is a foundational strategy for managing many portfolio risks, it is ineffective in protecting against market risk. However, the study found financial professionals and investors widely cite diversification as a key tactic. During systemic market events like the 2008 financial crisis or the 2020 COVID-19 crash, nearly all asset classes declined together, often rendering traditional diversification strategies ineffective without additional protective measures like annuities or hedging tools like derivatives.
• Moderate risk-taking correlates with better outcomes. Investors who adopt a balanced approach to risk (favoring diversification and moderate equity exposure) are more likely to meet key financial benchmarks. They are also more likely to use cost-efficient tools like index mutual funds and ETFs, contributing to better long-term outcomes.

Retirement vulnerabilities of the risk-averse investor

In a recent interview, Glen Franklin, assistant vice president of research, RIA, and lead generation strategy for Jackson National Life Distributors LLC (JNLD), the marketing and distribution business of Jackson, further explained some of the survey’s key findings. First, he said, some of the people in the study who report having a low risk tolerance also have investment preferences that may address one risk but amplify others. “For example,” he pointed out, “high index investors indicated their ideal cash allocation was 49%. That might help them avoid market volatility now, yet, at the same time, makes them vulnerable to other major retirement-related risks, such as inflation risk and longevity risk in the future.”

Also, Franklin said, “we found that high-index investors in the study lack financial resilience. On average, they have investable assets 70% lower than their low-index counterparts, and their average remaining mortgage balance is 78% higher than that of low-index investors. This is surprising, because to qualify for the study, they had to have a minimum of $100,000 in financial assets.”

Does diversification protect against market risk?

In addition, the study pointed out the ineffectiveness of diversification in protecting against market risk. And why is this the case? “Both financial professionals and investors report that diversification is the primary strategy for reducing risk,” Franklin pointed out. “Diversification is appropriate for mitigating un-systemic (or unsystematic) risk, such as too much exposure to a single company, industry or market sector,” he added.  “However, market risk is systemic. To address it, an investor must use some form of insurance, such as purchasing options, employing a hedging strategy, or by acquiring an insurance product such as an annuity.”

The risk of low long-term results

Franklin also explained another risk identified in the study–the risk of low long-term results. As he pointed out, low long-term returns amplify major retirement-related risks, including longevity risk, inflation risk and healthcare risk.

With increasing lifespans and the very real possibility of living 30 or more years in retirement, Franklin added, it is no longer appropriate to rebalance the retirement portfolio entirely to low risk/lower return assets once someone is in retirement. “That may result in outliving your savings,” he said.

Meanwhile, he added, “price increases have the effect of reducing the purchasing power of your savings. For example, the long-term average inflation rate is 3%. At that rate, prices double in 24 years, which is another way of saying the value of your savings is cut in half. What’s more, the long-term average inflation rate for healthcare expenses is higher, at between 4%-5%. In that range, costs double every 14-18 years—and for many, healthcare is the largest expense in retirement.”

Why risk-averse investors may face higher risk 

Also, as noted in the study, risk-averse investors face a higher level of risk exposure. So, why is this the case? Numbers alone can’t explain why people make surprising choices about retirement, Franklin said. “Our emotions are powerful and often guide our decisions, even when logic says otherwise,” he added. “It may be that risk-averse investors are unaware of the array of risks they face in retirement, or it may be that facing all those risks is overwhelming.”

Helping clients avoid market risks

So, what are some of the steps that financial advisors can take to assist their clients in avoiding the market risks identified in the study and help them build resilience against market volatility? “Our study found that 72% of low-index investors work with a financial professional, compared to just 43% of high-index investors,” said Franklin.  “So,” he added, “it appears that financial professionals are generally providing the guidance necessary to help their clients address retirement-related risks. What’s more, of the financial professionals surveyed, 61% use annuities with guaranteed income to manage investment risk for clients in retirement. The issue for some investors is that they are not seeking professional advice, leaving them less well prepared to face market risk.”

The research, fielded between October 15-29, 2024, included online surveys of more than 1,000 investors with at least $100,000 in financial assets, who are between the ages of 48 and 78 years. An additional online survey of 400 financial professionals was conducted between November 4-18, 2024, with respondents being client-facing financial professionals with at least 75 clients.

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The small and micro 401(k) plan segments are set to rapidly expand over the next few years due to incentives provided by SECURE 2.0, and more states implementing mandates to increase the number of individuals covered by some form of retirement savings vehicle, according to Cerulli Associates. Cerulli expects there will be more than one million 401(k) plans by the end of the decade—an increase of 36% over the next five years, according to the latest Cerulli Edge—U.S. Retirement Edition.

The number of 401(k) plans has grown significantly in recent years, Cerulli pointed out. Approximately 150,000 new 401(k) plans were added between 2018 and 2023, with nearly two-thirds of these plans added in 2021 and 2023. Much of this growth is from employers starting new plans. By 2029, Cerulli expects that 92% of all 401(k) plans will be in the micro plan segment, representing a nearly 40% increase in micro plans from 2022.

Defining micro plans

“Micro simply speaks to the size of the plan in terms of assets,” said Chris Bailey, as he explained what micro plans are. Bailey is director, retirement, at Cerulli. The company defines micro plans as those with less than $5 million in assets. Micro plans are usually associated with small businesses, he added. They have few employees; as a result, they usually have fewer assets in the plan. “A micro plan can also be a brand-new retirement plan that has not had very much time to accumulate assets. These can belong to small businesses or larger organizations,” he explained.

Factors driving the increase

As earlier stated, Cerulli expects that 92% of all 401(k) plans will be in the micro plan segment. What are some of the reasons for this expected increase? State mandates and tax incentives offered by SECURE 2.0 are two factors contributing to growth in this segment, explained Bailey. “More and more states are requiring businesses of a certain size to offer some form of retirement plan. As small businesses consider their options, we are seeing many choosing to start their own plan instead of adopting the program their state offers. It also helps that SECURE 2.0 provides meaningful tax incentives to encourage small businesses to set up a retirement plan,” he said.

Tapping into the micro 401(k) market

Advisors who wish to tap into this growing market can take a variety of steps. One place to start is at their home office, Bailey said. Their organization probably has training and resources to help these advisors get started, including resources that can help an advisor learn more about the 401(k) market, prospect for micro plans, and develop a pitch to the employer. If their home office does not have these resources, several recordkeepers and asset managers offer toolkits to help advisors learn about the retirement marketplace.

“Wealth advisors should also speak with their clients, especially those who own a business,” Bailey added. “Some may be responsible for a retirement plan and might need help managing the investments in their retirement plan, benchmarking fees, or establishing a new plan.”

What recordkeepers can do
The survey also said that recordkeepers who are eager to tap into this micro plan growth will need to adapt to the challenges of pursuing small businesses and align with the needs of plan sponsors in this market segment. “Micro plan sponsors are more cost-sensitive than larger employers and place more emphasis on brand. Retirement income options and financial wellness are lower priorities when considering which recordkeeper to work with,” added Bailey.

In addition, digital recordkeepers have established a competitive position in the micro and small-plan market. These providers bring a technological mindset to the retirement market, along with newer and more efficient recordkeeping platforms, the survey said. Their competitive positioning speaks to the biggest priorities of plan sponsors in this segment: cost, easy implementation, and simple administration. This different operating model, coupled with what appears to be a strong understanding of the needs of their target market, has positioned them to challenge incumbents for micro plans and startups.

Wealth advisors expected to play a larger role
According to the survey, wealth advisors are also expected to play a larger role in the micro market, as their home offices encourage them to pursue retirement plans to grow their wealth-management practices. A few recordkeepers with a long-term commitment to this segment have the capabilities to tap into the growth generated by wealth advisors.

“Recordkeepers who are seeking to win over these advisors and find success in the micro plan market should, if they have not already, be investing in resources to lower the barriers for wealth advisors,” said Bailey. “Given the large number of wealth advisors, firms will need to develop scalable sales and recordkeeping solutions designed to help advisors who have little knowledge of the ins and outs of retirement plans.”

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