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The Centers for Medicare and Medicaid Services does not plan to eliminate Medicare brokers or limit their ability to assist people in obtaining coverage.

A letter from Alexander Aramanda, principal deputy director at CMS, said that the agency does not use artificial intelligence bots to automatically enroll beneficiaries into Medicare Advantage or Part D prescription drug plans and has no plans to do in the future. InsuranceNewsNet obtained a copy of the letter.

The letter was sent in response to a health insurance agent association’s campaign asking its members and their clients to express their concerns to CMS over CMS Administrator Dr. Mehmet Oz’s remarks in which he publicly floated the idea of using AI as a decision-support and navigation tool for Medicare beneficiaries. He proposed using AI to help consumers understand their Medicare options, compare Medicare Advantage plans and providers, and navigate their enrollment choices.

HAFA launched letter-writing campaign to CMS

Health Agents for America launched a letter-writing campaign in late March to call on CMS to ensure that access to live, licensed professionals remains a priority; that AI supports and not replaces human interaction, and that safeguards are in place to protect seniors from confusion and errors.

“We absolutely think that Dr. Oz needs to hear from seniors and agents and brokers, because I think in Washington, they decide that this is a good idea without talking to human beings about how this is really going to work,” said Ronnell Nolan, HAFA president and CEO. “We decided the best thing to do is to go directly to the horse’s mouth, go to Dr. Oz and let him know our thoughts – what we think is good, what we think is bad.”

Using AI to enroll people in Medicare “only hurts the American senior,” Nolan said. “Why not take what we already have and make it better? Because until the carriers do a better job, until CMS does a better job, it won’t be effective at all. Could a bot replace Dr. Oz? I’m going to say no – the same way I’m going to say a bot cannot replace agents and brokers.”

Aramanda’s letter went on to say, “CMS is not pursuing any federal policy to discontinue Medigap plans, nor is the agency seeking to eliminate brokers or limit their ability to help people with Medicare.

“The broker community continues to play an important role in helping people understand their Medicare options and supporting informed enrollment decisions.”

Aramanda said that in the future, CMS may consider integrating AI into Medicare systems to guide beneficiaries through the Medicare Advantage and Part D enrollment process, answer questions and assist beneficiaries in comparing and selecting plans. But Medicare beneficiaries will continue to be able to choose between Original Medicare and Medicare Advantage.

“Any future AI tools deployed in Medicare enrollment will be designed to allow the beneficiary to be in control of choosing the health coverage options that best fit their needs and will comply with all applicable federal privacy laws.”

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Variable universal life insurance is known for the flexibility it offers clients. According to first-quarter sales numbers from Wink, Inc., clients are embracing the product.

VUL sales were up 15.1% over Q1 2025, Wink reported in its latest Sales & Market Report. Sales began percolating during the fourth quarter, with VUL up 4.3% over the prior-year quarter and up 22.4% over Q3.

Sales are slowest during Q1 and strongest at the end of the year. Total VUL sales for the first quarter were $316.1 million, down 19.1% quarter-over-quarter.

“The market has been on the uptick since the beginning of April,” said Sheryl Moore, CEO of Wink, Inc. and Moore Market Intelligence. “This translates to improved sales of variable UL.”

VUL is a permanent life insurance policy that combines a death benefit with an investment component. Policies can be customized with specific riders to provide coverage for needs such as long-term care.

Items of interest in the VUL market included Prudential retaining the No. 1 ranking in sales, with a 36.2% market share; Pacific Life Companies, Nationwide, RiverSource Life and John Hancock completed the top five, respectively.

Pruco Life’s PruLife Custom Premier II was the No. 1 selling VUL product, for all channels combined, for the quarter. The top primary pricing objective for sales this quarter was cash accumulation, capturing 63.4% of sales. The average VUL target premium for the quarter was $23,161, a decline of nearly 10% from the prior quarter.

Overall life sales up 8%

All life insurance sales for the first quarter were more than $2.9 billion, down 9.7% compared to the previous quarter and up 8.1% compared to the same period last year. All life sales include fixed universal life, indexed UL, variable UL, indexed whole life, whole life and term life product sales.

Noteworthy highlights for total life insurance sales of all products in the first quarter included Prudential ranking as No. 1 in overall sales for all life insurance sales, with a market share of 5.6%. Americo’s Eagle Select, a whole life product, was the No. 1 selling product for all life insurance sales, for all channels combined, for the quarter.

All universal life sales for the first quarter were $1.1 billion, down 16% compared to the previous quarter and up 4.3% 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 first quarter included Prudential ranking as No. 1 in overall sales for all universal life products, with a market share of 11.2%. Life Insurance Co. of the Southwest’s FlexLife, 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 first quarter were $851.9 million, down 15.2% when compared to the previous quarter and up less than 1% 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 first quarter included National Life Group retaining the No. 1 overall sales ranking for non-variable universal life sales, with a market share of 13.8%. Life Insurance Co. of the Southwest’s FlexLife, 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 first quarter were $65.2 million, down 25.9% compared to the previous quarter and down 18% 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 22.8% market share; Pacific Life Companies, John Hancock, Protective Life Companies and Penn Mutual 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 quarter. The top primary pricing objective of no lapse guarantee captured 33.0% of sales. The average fixed UL target premium for the quarter was $6,826, a decline of more than 22% from the prior quarter.

“Universal life sales have never been this low,” Moore said. “It is just getting more difficult to justify the sales of these products, when indexed life has a relatively stronger value proposition.”

Indexed life sales for the first quarter were $789.5 million, down 14% compared with the previous quarter, and up 2.8% 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 retaining its No. 1 ranking in indexed life sales, with a 14.7% market share; Pacific Life Companies, John Hancock, Nationwide, and Fidelity and Guaranty Life rounded out the top five, respectively.

Life Insurance Co. of the Southwest’s FlexLife was the No. 1 selling indexed life insurance product, for all channels combined, for the quarter. The top primary pricing objective for sales in the quarter was cash accumulation, capturing 74.7% of sales. The average indexed life target premium for the quarter was $12,922, a decline of nearly 3% from the prior quarter.

Whole life first quarter sales were over $1.2 billion, down 3.6% compared with the previous quarter, and up 22.6% 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 72.4% of sales. The average premium per whole life policy for the quarter was $3,860, a decline of more than 19% from the prior quarter.

Term life first-quarter sales were $521.8 million, down 7.6% when compared with the previous quarter and down 9.7% compared to the same period last year.

Items of interest in the term life market include Prudential ranking as No. 1 in term life sales, with a 6.5% market share. Pacific Life Companies, Protective Life Companies, Corebridge Financial, and National Life Group completed the top five, respectively.

Protective Life Classic Choice Term 20 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 $1,905, a decline of nearly 29% from the previous quarter.

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

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According to S&P Global Market Intelligence, the U.S. property and casualty insurance industry achieved record-breaking underwriting profitability in the first quarter of 2026, with a combined ratio of 89.5% before policyholder dividends.

This marks the best first-quarter performance in at least 25 years. The industry’s net underwriting gain reached $22.10 billion, driven primarily by exceptional results in homeowners’ multiperil and private auto lines.

When you consider the ongoing challenges in select casualty segments and increased competition in key markets, the first-quarter results are particularly noteworthy.

Why catastrophe losses haven’t derailed profits

These days, property insurance news is all about billion-dollar hurricanes, wildfires, and storm losses. While they attract a great deal of attention, their impact on private insurers was not uniform.

“For example, an excessive amount of damage from Hurricane Helene in 2024 stemmed from flooding, which was largely borne by the National Flood Insurance Program and/or non-U.S. reinsurance companies rather than U.S. private homeowners’ insurers, limiting the effect on carriers’ books,” said Jason Woleben, insurance analyst at S&P Global Market Intelligence.

In 2025, hurricane-related losses were exceptionally low, reportedly under $1 billion, compared with an average of roughly $30 billion annually from 2016 through 2024.

“This unusually benign hurricane season, combined with the full earning-in of several years of aggressive rate increases, boosted industry profitability over the past two years,” Woleben added.

A delayed payoff years in the making

The analysis by S&P Global Market Intelligence points to major improvements in property and private auto results. According to Woleben, the primary driver is the realization of several years of aggressive rate hikes.

“Insurance companies are now finally earning the benefits of these price increases in their books, which has increased profitability,” Woleben explained.

Other risk management strategies, like separate wind and hail deductibles as well as non-renewals, have also helped with overall loss mitigation, but the delayed payoff is the key behind the impressive profits.

Are these profits sustainable?

The industry is past the peak of the hard market cycle in both private auto and commercial property, with signs of material softening in commercial property.

“Concerns about a return of inflationary pressures in private auto will likely cause carriers to remain disciplined even as pricing begins to moderate,” Woleben said.

Insurance companies will be cautious in their approach to lowering rates, as meaningful profitability pressures persist, including social inflation as well as elevated costs for materials for repairs and replacements.

Additionally, the risk of catastrophic losses can quickly erode margins after a relatively light 2025.

“While the industry should continue to generate a period of strong profitability in these lines, we don’t view current earnings levels as a new normal. Instead, profitability is more likely to remain favorable in the near term before gradually moderating,” Woleben added.

The advisor takeaway

As you meet with clients, agents are likely finding that many of them are frustrated about premium increases and feel insurance companies are over-earning.

Emphasize the fact that the record profits stem from the big rate hikes insurers put in place over the past few years, Woleben said.

“Make it clear that those gains aren’t likely to last forever because they’re not,” he said.

They’re mostly due to the cycle, not a sign that insurers are going to consistently achieve excess returns.

“It looks like the industry is near the top of this cycle, with many companies now slowing down or even cutting rates. Profitability could drop quickly if a big catastrophe hits, which shows how these results are really tied to the ups and downs of the cycle,” Woleben explained.

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In an environment where most companies are taking the same measured approach to AI adoption, leaders who turn risks into opportunities can set their brand apart from the crowd, according to Michelle Horton, risk and regulatory health industries practice leader, PwC.

Data from PwC’s 2026 C-Suite Outlook indicates most leaders see AI adoption as a major growth driver, even as concerns around cyber attacks and regulatory complexity increase.

“There may be executives and leaders who find comfort in riding along with the pack. But what that does provide is opportunities for those who want to break away and do something different,” Horton said.

“But it’s going to take folks who have confidence in decision making; they feel like they’ve got a good lay of the land and there’s an opportunity for competitive advantage by taking advantage of some of the risks and turning them into opportunities.”

‘Heavy focus on AI’

Sixty percent of the executives who responded to PwC’s survey said the speed of technology adoption and scaling drives growth. A similar 58% held the same view about the pace of return on investment for AI, although 81% said they’re at least a year away from seeing meaningful returns beyond efficiency.

“It was the top area of investment. When we were asking about the moves that executives were making, the one that they responded to making the most impact around was technology and AI investment,” Horton said.

Thirty-eight percent of respondents said they increased tech and AI investments, while 62% said they’ve improved technology adoption and innovation — leading to greater strategic agility, Horton noted — and 33% said they are rebalancing their workforce across humans and AI.

For the financial services sector specifically, 95% of respondents said they are either maintaining, increasing or starting new spending on AI and technology.

“So, basically, AI is becoming central to decision-making,” Horton said. “There’s a heavy focus on AI. I think it’s a no-brainer; everyone needs to be thinking about this. But, again, it’s more of the same. Everyone’s commenting on the same themes. … Everyone’s moving together at this point, but who is actually going to get ahead?”

AI emerges as top business risk

While AI opportunities were a key priority for executives, most respondents also listed AI-related cyber attacks and regulatory complexity as their top business risks — even above an uncertain macroeconomic environment.

When asked to identify the top risks for their respective companies, the top picks were a complex regulatory environment (69%), cyber attacks (68%), an uncertain macroeconomic environment (66%) and margin pressure affecting earnings (66%).

Fifty-six percent of respondents also cited cybersecurity and technology disruption — including cyber attacks, ransomware and the like — and macroeconomic and capital markets conditions as the biggest drivers of significant strategic business changes in 2026.

“In the most recent history, we always see cyber being a significant risk,” Horton said. “It’s usually at the top of the list, and that hasn’t changed. With AI, the tech surface is changing, so certainly top of mind as companies start to adopt more AI and we have new technologies coming out that can be used for both good and bad.”

She also said regulatory complexity will “continue to be a challenge,” especially with “a patchwork of regulatory requirements” that can differ significantly, and some areas still lack clear AI regulations at all.

“Some are country-driven, where you have different requirements in the EU versus the US, and then we have different state requirements around AI and data use. So, it does get complicated,” Horton said.

‘Common discomfort’ drives opportunity

The survey’s results indicate many executives are in the same proverbial boat when it comes to AI, which leads to the question of how companies can stand apart from the crowd.

“Going through the data, we found that it’s almost like there’s comfort in the common discomfort, because these executives are all feeling the same challenges or similar types of challenges — adoption of AI, dealing with cybersecurity threats, changing geopolitical environment — it’s almost like everyone’s in that spot,” Horton explained.

“What we read between the lines there is that, yes, they may be more comfortable, but it may mean that no one’s really differentiating themselves. So, who’s getting ahead then?”

She suggested that the execution of AI strategies will differentiate leaders as they leverage risks to outpace competitors.

“With the advanced technology we have in AI, there are ways to really look at your different options and think about the scenarios that might play out and what options you have to make a move now or maybe in the future. I think companies have more insight at their fingertips. It’s just a matter of taking the time to pull it together and use it for more competent decision making,” Horton said.

The PwC April 2026 C-Suite Outlook was conducted March 12-20, 2026. PwC surveyed 633 executives and financial leaders across the United States in multiple industries, including financial services.

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The growing mismatch between how long Americans are living today and how financially prepared they are could be due to fragmented systems more than financial literacy, according to Chris Moran, head of market strategy and partnerships, Savvi Financial.

In an interview with Insurance News Net, Moran noted that people are now living around 10 to 15 years longer than before, but many still “haven’t figured out how to support those extra years” from a financial standpoint.

“For a long time, the financial services business has viewed this as an education problem,” Moran said. “There’s a lot of talk about financial literacy or an individual behavior problem, meaning people aren’t disciplined enough to do it. We see a lot of investment in education to help solve the behavior problem, yet we’re still seeing a great deal of financial stress.”

At the same time, he said life is more complex now than it used to be as people are “dealing with rising healthcare costs, uncertainty around Social Security, market volatility, debt and all these things are somewhat fragmented.”

However, he suggested artificial intelligence can help coordinate financial planning across siloed systems and deliver personalized advice at scale.

“This was impossible 20 years ago, but I think where we are today, in the age of AI, access is becoming better. With where the analytics and decision science is today, we’re in a much better spot,” he said.

Financial advisors play a key role in helping clients tap into this.

“My personal opinion is that the role of financial professionals is going to become more important, not less,” Moran said. “I don’t see technology replacing them… We really see the role of advisor becoming less portfolio manager and more like a financial systems architect where they’re really going to help households build this structure that’s going to allow them to maintain a quality lifestyle both while they’re working and also into retirement.”

‘Longevity alone is not the issue’

In Moran’s view, longer lifespans on their own are a big part of the longevity crisis equation. But, “the bigger challenge” is that financial responsibility has been shifted entirely onto the individual without significant improvements to existing systems or coordination of systems needed to support those financial decisions.

“You think back 30, 40 years ago, your parents worked 30, 40 years, they got a pension,” he noted. “They got healthcare and they had an enjoyable retirement. Now, a lot of responsibility is on the employee, but we really haven’t given them the tools to navigate those.”

Further, many of those decisions are “made in silos,” where a benefit decision is made at open enrollment, retirement decisions are made throughout the year, and other financial decisions are made in tandem with bi-weekly paychecks.

“We really see it as a system design problem, meaning the system wasn’t designed to deliver the better outcome for the employee,” Moran said. “The employee experiences one financial life, yet we ask them to make these decisions around products and also where they make the decisions fragmented.”.

Connecting the dots

Helping people coordinate decisions across the different financial aspects of their life will be key to solving the issue, alongside education and personalized guidance, Moran suggested.

“I think this is where it’s not necessarily more product — we always used to try to say there’s a new silver bullet product out there that’ll solve it. But what we really believe is more being able to connect the systems,” he said.

This is an area Savvi expects to see “a lot of advancements” in over the next two to three years to help solve the problem of coordinated financial decisionmaking, Moran said.

“I think there’s more work for us to do to align, from insurance carriers to brokers, to employers, to record keepers, payroll providers and benefit platforms, to serve the employee better and deliver better outcomes for those employees,” Moran acknowledged.

For instance, he said the financial services industry “really needs to do a better job of helping the employee understand what their risks are.”

“Employees tend to plan for a stable income and stable health. But the reality is, life isn’t stable,” he noted. “You’re going to lose your job at some point. You’re going to have a health event at some point, and is your financial system going to be able to withstand that? We want to be able to help people measure that risk, and then really get people into a much more durable position.”

The good news, Moran added, is AI can help enable and scale that effort “easily.”

“Where a human advisor could only work with 50, 100 households, they were limited,” Moran said. “But because of technology, we can reach millions of households with this. The best part is, people are going to be able to access the quality decisions, and that’s really what’s going to change things for the industry overall. That, I’m excited about.”

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If you won the lottery today, would you continue to work or retire?

According to the 2026 Annual Retirement Study from the Allianz Center for the Future of Retirement, part of Allianz Life Insurance Co. of North America, more than half of Americans (54%) said they would retire immediately if they won the lottery.

With the chances of winning the lottery averaging around 1 in 300 million, Americans need a better plan – particularly if they want to retire on their own terms.

The study found that most Americans worry that they will not be able to retire when they want, and more than half (57%) are concerned with not having enough money saved.

The study found that 53% of Americans retired about when they expected. More than four in 10 (42%), however, retired earlier than expected – often due to circumstances beyond their control. Only 5% said they retired later than expected.

The most common reasons for retiring earlier than anticipated were health issues that prevent performing the job (30%), an unexpected job loss (21%), and being financially ready earlier than expected (21%).

“Many people find themselves retiring early either due to their own health or needing to care for a loved one with health issues,” said Kelly LaVigne, vice president of consumer insights at Allianz Life.

“You need to make sure you’ll get as close to that target date, with a contingency plan in the event you need to retire earlier,” he added.

How to plan for the unexpected

When determining when to retire, many don’t take into account things that are beyond their control. Americans still working said the most likely reasons they would retire early would be to spend more time with family (36%), being financially ready earlier than expected (32%), and wanting to reduce stress (31%), the study found.

Retiring early is clearly an aspiration for the majority of Americans. Seven in 10 (70%) said they want to emulate the financial strategies of those who achieve early retirement.

More than one in three (35%) said they would likely decide to retire if they lost their job in the next six months. More boomers (58%) said they would likely decide to retire if they lost their job in the next six months than Gen Xers (29%) or millennials (30%). Many Americans (54%) also worry that potential cognitive decline will impact their ability to work for as long as they hope.

A financial professional can help

So how do you plan for the unexpected? A contingency fund is a good place to start, LaVigne said. Similar to having an emergency fund for six months of expenses, he said Americans need a similar plan with some type of retirement savings account.

“Put money away in a Roth IRA or a Roth 401(k) so that you can keep investing for possible growth, without increasing your tax burden,” he said. “If those options aren’t available, investing in the market to receive long-term capital gains treatment, such as in a low-cost ETF [exchange-traded fund] or buffered ETF for protection, could be a better option.”

LaVigne recommended working with a financial professional who can use planning software to develop a written plan that includes contingencies if you have to retire earlier.

Keeping your budget in check is critical.

“By doing things like taking a vacation every other year, you can put more money toward your retirement,” LaVigne said. “The good news with this is if you don’t need to retire earlier than expected, you may be able to anyway,”

Having to pay for healthcare expenses before you’re Medicare eligible can be an unforeseen problem, he added.

“The expense of healthcare can be crippling for some,” LaVigne said. “Paying for long-term care or a chronic health condition are some of the scariest things for people to consider.

“Using vehicles like fixed indexed annuities and registered index-linked annuities can help you be in the market with growth potential while also having some protection from market downturns.”

The best way to save for retirement is to know what you’re spending now and to have a written plan for the future.

Regular conversations with a financial professional is the best way to plan for contingencies, LaVigne said. As Malcolm X once said, “The future belongs to those who prepare for it today.”

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Although artificial intelligence was expected to reduce costs in health care, emerging evidence suggests that it may be increasing spending for many payers.

Rob Duffy, chief technology officer at HealthEdge, explained how AI is increasing costs for many payers.

First, Duffy said, there is the medical loss ratio (MLR) bucket, which is the actual cost of care, and that’s where AI is creating the most obvious upward pressure right now. Then, he added, there’s the administrative loss ratio (ALR) bucket, which is the cost to own and operate the plan, claims operations, systems, labor, integrations, and other functions.

“The reason both matter is that AI can push costs up in both places: externally, through more utilization and more optimized claims, and internally, if plans respond to AI with more complexity instead of more scale,” he explained.

The first place you see it is in utilization, Duffy said. Consumers are getting smarter with their health care, and tools like Chat GPT mean that people are self-diagnosing, researching symptoms and going to see doctors in situations where they may not have gone before. Some of that is good, he pointed out. After all, “we want members to be engaged.”

But from a payer perspective, it means more visits, more services, more claims, and more utilization flowing through the system, Duffy added. That shows up directly in MLR.

‘That makes complete sense’

The second big area is the provider revenue cycle, Duffy said. Providers are using AI to code claims more effectively, capture documentation more completely, and optimize reimbursement.

“Again, from the provider’s side, that makes complete sense,” he said. “But from the payer side, it can increase the amount paid on claims and create even more upward pressure on MLR. So, yes, AI is increasing the volume of care, but it’s also making the claims that come through more economically optimized for the provider.”

And then there’s a third cost risk, which is operational and where ALR factors in, Duffy added.

If plans just bolt AI tools onto fragmented legacy systems, they can actually increase their administrative loss ratio instead of reducing it.

“You get more integrations, more data movement, more reconciliation, more vendor sprawl, and more one-off proofs of concept that don’t scale,” Duffy said. “So even though the biggest AI-driven cost pressure is showing up in MLR, payers also have to be careful that their AI strategy does not create a new layer of ALR cost on top of an already complex operating model.”

Reducing costs

So, what are some of the steps that payers can take to reduce these increasing
costs? The first thing that they need to do is to be very clear-eyed about what they can and cannot control, Duffy said.

They are not going to stop consumers from using AI to understand their symptoms, and they are not going to stop providers from using AI to code more effectively and optimize the revenue cycle.

“Over time,” Duffy said, “plans absolutely need strategies for both of those things, like better member education and guidance around AI, and better payer-side AI in areas like payment integrity, claims review, and utilization management,” he added.

But where a plan can get more immediate relief, and where it has the most direct control is the administrative loss ratio, Duffy said.

“The question I’d be asking as a business leader at a plan is: Can we accelerate ALR savings fast enough to offset the MLR pressure that is already here?” he added. “Reducing administrative costs through automation, scalable platforms, and AI that is actually embedded into the operating model – is the lever payers can pull right now.”

That starts with infrastructure.

“If you have different lines of business, different regions, different versions of core admin platforms, and hundreds or thousands of integrations, you are not going to get the leverage you need from AI,” Duffy said. “You have to simplify. You have to consolidate. You need a single view of the data and a platform that lets you operate at scale, because otherwise, every AI use case becomes another custom integration project.”

Stop thinking of AI as a bolt-on

The second step is to stop thinking about AI as a bolt-on and start embedding it into the operating model of the plan, Duffy said. AI needs to be deeply connected to the system of record so it can consume information, trigger workflows, support agents, reduce manual clicking, and actually change the cost structure of the business.

“That is where you start to get real ROI, from AI that is integrated into claims, care management, payment integrity, member engagement, and the core administrative workflow,” he said.

Finally, payers need to decide if they can build and maintain that capability internally fast enough, Duffy said. Because the market is moving very quickly.

“If you can build the skill set, ship rapidly, govern it properly, and keep driving ALR down, great,” he said. “But if not, you should be asking whether there is a partner who can guarantee outcomes, continue investing in the technology, and help you move fast enough so your business stays healthy while your core workforce focuses on member engagement, health outcomes, and taking care of the member population.”

Ayo Mseka has than 30 years of experience reporting on the financial-services industry. She formerly served as Editor-In-Chief of NAIFA’s Advisor Today magazine. Contact her at amseka@INNfeedback.com.

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Prudential Financial is undergoing another round of layoffs as the company continues to evolve in Year Two under CEO Andrew Sullivan.

According to a filing with the New Jersey Department of Labor and Workforce Development, Prudential is laying off 53 employees on July 17. That follows previous layoff notices in March (54 employees), November (63), September (63) and July 2025 (57).

Sullivan officially succeeded Charles F. Lowrey on March 31, 2025.

A spokesperson for Prudential pointed out that the Newark, N.J.-based insurer is a worldwide company with 36,000 employees.

“Prudential is strengthening our business to deliver long-term growth by investing in the capabilities where we’re most competitive,” reads a statement from Prudential. “That means continually making targeted adjustments including, at times, reorganizing our workforce to align with the company’s strategy. These decisions are never easy, and we’re committed to providing impacted employees with support, care and respect.”

Japan problems

Prudential executives are dealing with an earnings drag due to problems in its Japan affiliate. Prudential of Japan is currently navigating severe compliance issues involving employee misconduct and inappropriate investment solicitations, resulting in a prolonged halt on new sales.

Prudential initiated a voluntary 90-day suspension of new POJ sales in February 2026. The sales pause was extended for an additional 180 days after it was determined the Japanese subsidiary was not ready to resume operations, extending the suspension through late 2026.

The total revenue loss and remediation cost associated with the Japanese market disruptions is estimated at approximately $1 billion.

Overhauling the team

Prudential overhauled its leadership team, restructured operations, and shed noncore assets to fuel growth in retirement and asset management, explained Sullivan and Yanela Frias, executive vice president and chief financial officer, during the company’s recent Q1 2026 earnings call.

The company had higher operating expenses, Frias said, but is investing in service and technology to offer an “enhanced customer experience.” Prudential expects to see expense savings show up in 2027, she added during the May call.

“These are investments in things like modernizing and driving efficiencies in onboarding and claims management and group, and investments in service delivery throughout all our U.S. businesses,” Frias said. “These do lead to efficiencies.”

Prudential entered 2026 with a realignment of its senior business leadership structure. As a result, leaders responsible for the company’s U.S. businesses, Emerging Markets, the Japan Group and Prudential’s asset management business, PGIM, now report directly to Sullivan.

Phil Waldeck was appointed executive vice president, head of Prudential’s U.S. Businesses. In a corresponding move, Caroline Feeney, global head of Retirement and Insurance, departed Prudential after a 33-year career with the insurer.

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The life settlement market is often described as niche, but recent five-year data from the Life Insurance Settlement Association tells an interesting story.

Since 2021, more than $20 billion in life insurance policy value has changed hands through the secondary market, with LISA members paying consumers $3.6 billion for policies they no longer needed. This is $3 billion more than those same policyholders would have received by surrendering to insurers.

These figures shed light on a mature, regulated industry with minimal awareness among both consumers and advisors.

An estimated $50 billion in policies are still lapsed or surrendered each year. As retirement pressures rise, life settlements offer a way to unlock much-needed liquidity from existing assets.

However, many eligible policies are still surrendered or allowed to lapse simply because this option isn’t considered. Advisors need to recognize the benefits of life settlements and present them to clients who could benefit from them the most.

Why is awareness low

Surrendering a policy has long been treated as the default outcome when coverage is no longer needed.

“Many consumers, and even financial advisors, still do not realize a regulated secondary market exists for insurance policies,” said Bryan Nicholson, executive director of the LISA.

Despite the scale of the market itself, the awareness gap persists. Compared to traditional life insurance policies and other financial products, there simply isn’t enough education and promotion around life settlements.

The ideal clients for life settlements

Life settlements aren’t for everyone. However, they’re often a good option for those whose financial or life circumstances have changed since they originally purchased their policy.

“Maybe they no longer have the need they originally had. Or perhaps their coverage is too expensive for their current situation,” Nicholson explained.

For example, a 65-year-old client may hold a universal life policy with premiums that have continually increased over time. If this product no longer aligns with their budget or lifestyle, life settlements might be worthwhile.

“Life settlements can also benefit retirees with financially independent children, those who have paid off their mortgage, or families who need to make changes to their estate plan,” Nicholson added.

The common thread is that many policyholders are sitting on a meaningful financial asset without fully understanding its market value. Life settlements are often a better option than surrendering a policy or losing it because, in those cases, clients let premiums lapse.

Life settlements in financial planning

These days, the retirement gap is widening, and more Americans are looking closely at assets they already own rather than taking on additional market risk or new financial products. That’s where the value of life settlements truly shines.

“For many policyholders, an unwanted or underperforming life insurance policy may represent a meaningful source of untapped liquidity, making a life settlement worth exploring,” Nicholson said.

As an advisor, it’s essential to recognize this and support clients who can leverage such a commonly overlooked yet effective tool.

To reach a client who could reap the benefits of life settlements, first explain what they are and welcome questions about how these products work, Nicholson explained. As with any product, education is key.

“Clarify that a life settlement can help them recover substantially more value from an asset they already have,” Nicholson said.

Also, debunk the common misconception that life settlements take advantage of policyholders. That’s not the case. The industry is highly regulated, supporters say, but some clients may believe otherwise and worry about finding a legitimate institution.

Once they express interest in life settlements and you’ve alleviated any hesitations they might have, you can take the next step and help incorporate them into the client’s holistic financial plan.

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State insurance regulators are seeking to reopen a key annuity illustration model regulation as they consider a significant overhaul of how illustrations are used in the sales process.

The National Association of Insurance Commissioners’ Annuity Illustration Working Group held conference calls last week and this week in an attempt to forge a consensus path forward on the polarizing issue of illustrations.

Under Chairman Ben Slutsker, director of life actuarial valuation at the Minnesota Department of Commerce, regulators are weighing revisions addressing illustration length, disclosure requirements, accountability measures and how insurers present non-guaranteed crediting rates.

But first, the working group needs approval from its parent committee, the Life Insurance and Annuity Committee, as well as the NAIC Executive Committee before it can reopen the annuity illustration model #245.

“Hopefully, in the next couple of months we can get sign off there to reopen the model, at which point under NAIC policy I believe we have a year … to modify the model,” Slutsker explained.

The group is simultaneously considering a temporary “stopgap” approach through an actuarial guideline that could be used before any model revisions are adopted by individual states. Industry trade groups eyed that idea warily.

“We think that there are some other alternatives that you could use as a stopgap that is not an actuarial guideline,” said Carrie Haughawout, senior vice president of life insurance and regulatory policy at the American Council of Life Insurers. “There are some questions about whether an actuarial guideline is going to go beyond and act more like a policymaking tool than a guideline.”

‘A lot of people don’t understand’

Regulators spent much of Tuesday’s meeting discussing a list of potential modifications compiled from public comment letters. Several proposals focused on shortening annuity illustrations, which some regulators said have become overly lengthy and difficult for consumers to understand.

Joshua Blakey of the Oregon Division of Financial Regulation expressed support for combining multiple illustration scenarios into a single ledger, arguing that side-by-side comparisons could reduce consumer fatigue caused by lengthy documents.

Shorter illustrations would not only reduce document volume but also help consumers avoid being distracted by large projected account values generated through decades of compound growth, said Mike Yanacheak, chief actuary at the Iowa Insurance Division.

“A lot of people don’t really get and understand compound interest and what it can do and might miss the whole point of what the illustration is trying to show about how a product works when it just dazzles with really, really big numbers that might be 50 or 70 or more years out,” Yanacheak said.

Consumer advocates urged regulators to focus on simplifying disclosures rather than adding complexity.

Bonnie Burns of California Health Advocates said consumers often struggle to understand annuity products and may be unaware of fees and charges associated with riders and benefits.

She suggested a simple question-and-answer format addressing common consumer concerns, including benefit eligibility requirements, costs and long-term care features increasingly attached to annuity products.

And it is worth repeating some information contained in the Annuity Buyer’s Guide, Burns stressed.

“The buyer’s guide is a great tool,” she said, “but not everyone will read that, and they certainly won’t read it at the time of sale. Some duplication of the most common things that consumers are concerned about would be an appropriate disclosure.”

Education or sales?

A significant portion of the discussion focused on how insurers should illustrate non-guaranteed crediting rates, one of the most contentious issues facing the working group.

Some participants questioned whether illustrations should be used primarily as educational tools or as sales tools that allow consumers to compare competing products.

Some speakers urged regulators not to eliminate consumers’ ability to compare products from different insurers. Others argued that illustrations should focus on explaining product mechanics rather than projecting future performance.

Blakey said illustrations that function as sales tools create incentives for insurers to show increasingly optimistic crediting rates.

“I feel like the more that these are used as sales tools, the more incentive there is to show higher and higher crediting, regardless of the product type, if you’re trying to differentiate yourself from competitors,” he said. “So, I like the idea of trying to make them more informational and educational than a sales tool.”

There are rate sheets and brochures and other items that can be used as advertising, Blakey added.

The working group plans to release two 45-day exposure drafts: one seeking feedback on potential modifications to Model 245 and another requesting comments on the proposed actuarial-guideline framework and alternative stopgap measures.

Regulators said they expect to review comments later this summer as they continue work on the model revision effort.

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