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Update: Robert Rikard, attorney for the Busches, and a spokesman for PacLife both released the following statement: “The Busch family and Pacific Life are pleased to have reached an amicable resolution of their dispute. Both sides worked constructively to achieve a confidential result that is mutually acceptable and avoids further legal proceedings.”

NASCAR driver Kyle Busch and his wife, Samantha Busch, have reached a confidential settlement with Pacific Life Insurance Co. and two other defendants in a civil lawsuit over indexed universal life sales, according to a court filing.

The Busches, PacLife and defendants Rodney Smith and Red River LLC notified the court Thursday that they have resolved the dispute and are in the process of finalizing settlement documents.

The parties said they expect to file a stipulation or motion to dismiss the case within 30 days. Under the agreement, each side will bear its own attorneys’ fees and costs.

The parties asked the court to stay all pending deadlines while they complete the settlement paperwork and formally move to dismiss the action.

The Busches’ lawsuit began in state court in October and was quickly moved to federal court in the Western District of North Carolina.

According to the complaint, the defendants used misleading illustrations, undisclosed costs, and false promises of guaranteed multipliers and controllable charges to induce Kyle and Samantha to pay more than $10.4 million in premiums, resulting in net out-of-pocket losses exceeding $8.58 million.

The complaint accuses PacLife and its appointed agent, Rodney Smith, of designing and promoting a series of complex IUL policies as “tax-free retirement plans” that were misrepresented as safe, self-funding investment vehicles.

Big retirement plan

Kyle Busch was assured that by contributing a million dollars annually for five years, he could withdraw $800,000 per year starting at age 52, he said in a news release. Instead, Busch discovered that his funds were being directed to the insurance company’s account rather than being invested in the market, preventing his investment from growing as the market rose.

PacLife filed a motion to dismiss in late January, noting that the Busches signed policy illustrations indicating they intended to pay planned premiums and hold the policies over 30 years, the insurer said. Instead, the couple bailed out on the plan and surrendered the policies before their growth potential could be realized, a memorandum accompanying the motion reads.

“Rather than accept responsibility for their own decisions, Plaintiffs now attempt to blame their negative outcome on the IUL product – a product approved by insurance regulators in every state – and purported oral promises that are directly contradicted by express written disclosures they acknowledged and signed,” the memo states.

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A group of major oil companies is asking a Washington state federal court for a stay of discovery deadlines in a climate-related lawsuit. A costly discovery phase could be avoided, defendants say, if the court waits to hear their forthcoming motions to dismiss the case.

Defendants, including Exxon Mobil Corp., Shell, Chevron Corp., BP, ConocoPhillips and the American Petroleum Institute, filed a motion seeking a protective order.

The companies want to pause scheduling deadlines until 30 days after the court rules on their motions to dismiss, which attorneys say will be filed on March 11. The parties have already agreed to a briefing schedule, with arguments set to conclude in late June.

Washington state homeowner’s insurance rates increased by 51% over the past six years, the two plaintiffs claim in the lawsuit filed Nov. 25. They claim that oil companies are to blame for driving climate change, and along with it, rising insurance rates.

The companies, states the lawsuit, “were well aware of that climate change associated with the sale of fossil fuel products would result in extreme weather events and rising sea levels, and they invested heavily to protect their own assets, infrastructure, and operations from them and invested to continue and expand their conduct that was contributing to climate change.”

Richard Kennedy of Normandy Park, Wash., and Margaret Hazard of Carson, Wash., are the plaintiffs and are represented by Hagens Berman, an international law firm with Seattle offices.

‘Unprecedented theory of liability’

The oil companies should be held liable under state law for harms tied to more than a century of fossil-fuel production, energy consumption, and resulting greenhouse gas emissions that contributed to global climate change, plaintiffs argue.

Citing a January report from the Department of the Treasury, plaintiffs note that, from 2018 to 2022, the annual number of major disaster declarations for climate-related events was almost double the annual average over the 50 years from 1960 to 2010.

In 2023, U.S. natural catastrophes cost an estimated $114 billion, of which approximately $80 billion was insured, the lawsuit said. Through the first three quarters of 2024, natural catastrophes caused $145 billion in economic losses, of which nearly $80 billion was insured.

Kennedy said his homeowner’s insurance premiums totaled $1,012.10 in 2017, the lawsuit said. By 2022, that bill rose to $2,149.18, an increase of approximately 113%.

“Plaintiff was unaware of Defendants’ misleading and deceptive acts concerning the true impact their practices had on climate change and the related increase in his insurance premiums based on this wrongdoing,” the lawsuit reads.

But defendants say the claims rely on a “novel and unprecedented theory of liability” and raise fundamental legal issues that should be resolved before any discovery begins. They plan to challenge the case on multiple grounds, including lack of personal jurisdiction and failure to state a claim.

“Plaintiffs’ allegations are unlikely to survive Defendants’ forthcoming Motions to Dismiss for multiple, independent reasons,” defendants’ attorneys write.

In their filing, the companies point to similar climate-related cases that have been dismissed at the pleadings stage, citing a “growing chorus of state and federal courts” rejecting comparable claims.

SCOTUS to take the case

Dozens of “climate accountability” lawsuits have been brought by U.S. local governments seeking to hold oil companies financially liable for local climate-related damages like wildfires and floods.

Last week, the Supreme Court granted certiorari in Suncor Energy v. City of Boulder, which many legal experts are calling the most significant development in these “dozens” of cases to date.

The high court will decide if federal law, specifically the Clean Air Act, preempts state-law claims for climate-related damages. If the Supreme Court sides with the oil companies, most of the approximately 40 similar lawsuits nationwide — including those in California, Hawaii and New Jersey — could be dismissed before ever reaching trial.

In the Washington case, the court previously set deadlines for initial disclosures, a discovery conference and a joint status report. Those deadlines were temporarily stayed to allow the defendants to seek further relief.

The companies argue that without a stay, the parties would be forced into extensive and potentially costly discovery in what they describe as a sweeping putative class action. They contend it would be more efficient for the court to first determine whether the case can proceed at all.

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Life insurance application activity grew 9.5% in January, the highest year-over-year growth rate for any January on record, according to the MIB Life Index.

Compared to previous Januarys, activity was up 11.1% over 2024 and up 15.9% compared to 2023. On a month-over-month basis, January 2026 was up 11.7% compared to December 2025, the fourth year in a row of double-digit monthly growth in January.

In addition, applications for those ages 40 and older saw double-digit YOY growth, while ages 30-39 saw flat activity, and ages 0-29 declined 7.5%. This increase in applications included double-digit YOY growth across all product types. Year-over-year term life was up 26.4%, whole life increased 15.6%, and universal life was up at 34.7%.

Looking at YOY activity for January 2026 by face amounts, MIB saw double-digit growth for face amounts from $100,000 up to but not including $2.5 million, triple-digit growth for amounts from $2.5 million up to but not including $5 million, and flat activity for amounts from $1 up to but not including $100,000, and from $5 million and over.

Life insurance application activity finished 2025 with record-breaking growth of 6.8% compared with 2024, representing the highest annual growth rate on record, MIB has reported.

Michelle Robbins, a licensed insurance agent with USInsuranceAgents.com, said that while not every application results in a sale, when more people apply, more people buy. Following COVID-19, people became more interested in insurance products across many types, including life insurance, she said.

“Right now, people are doing okay financially, but they’re also feeling nervous. That puts them in a position to consider life insurance more,” she said. “There’s a lot of education available about life insurance and its benefits, especially for individuals with dependents who rely on their income. A combination of these factors has spurred increased interest and increased sales.”

Big growth across age groups

Looking at the ages of applicants in January, ages 0-29 saw double-digit growth for face amounts from $1 million up to but not including $2.5 million and amounts $5 million and over, triple-digit growth for amounts from $2.5 million up to but not including $5 million, flat activity for amounts from $250,000 up to but not including $500,000 and declines for all other face amounts, in the double digits for amounts over $1 up to but not including $100,000.

Term life saw YOY growth for all age bands, in the double digits for ages 30-69 and in the triple digits for ages 70+. Whole life saw YOY growth for those ages 30 and older, in the double digits for ages 40-49 and those 60 and older, and flat activity for ages 0-29. Universal life saw YOY growth for all age bands, in the double digits for ages 40-69, and in the triple digits for ages 70+.

Financial professionals see continued growth

Ian Skjervem, CEO of Smart Investors Daily, has seen the same pattern MIB highlighted, especially among people in their 40s and 50s who are carrying a mortgage and supporting kids or aging parents.

“Life insurance became a ‘this month’ task instead of a ‘someday’ topic for many of them,” Skjervem said. The question he hears now most often is a simple one: “How long does my family float on if my paycheck goes away next month?”

That attitude coincides with the increased term life activity and increased face amounts, he said. Skjervem does not believe this is a one-month spike.

“In my opinion, the durable trend is with mid-career households who finally begin to realize that employer coverage and savings is not enough to protect their dependents for long enough,” he said. “As long as the memories of inflation, health concerns and layoff headlines remain fresh, I expect a strong interest in simple term coverage, particularly for people aligning policies with the remaining mortgage years and children’s time at home.”

Rami Sneineh, an owner and a licensed insurance producer at the Insurance Navy Brokers, agreed. The MIB numbers mirror what Sneineh and his team saw in January. He said they received approximately 30% more calls than in the previous January.

“Consider the scenario that you wake up and realize that all the future of your family was based on a GoFundMe page that was not getting any traffic,” he said. He has seen a big surge of new customers inquiring about life insurance as they are now starting to appreciate that the risk is real.

When people are feeling insecure, they purchase protection, Sneineh said. Buying life insurance is now as simple as ordering pizza online, he noted, as opposed to waiting weeks for a quote due to the need to visit a doctor for a physical examination. Today, his company offers technologies that allow people to register during a lunch break on their phones.

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The Department of Labor on Thursday unveiled a proposed rule aimed at clarifying how businesses and workers determine whether a job qualifies someone as an independent contractor or an employee under federal labor laws.

The rule, announced by the department’s Wage and Hour Division, would rescind a 2024 rule finalized under the Biden administration and replace it with an updated framework that echoes earlier standards used before 2024.

Under the proposal, a worker’s status would be evaluated using an “economic reality” test focused on factors such as how much control a business has over the work and a contractor’s opportunity for profit or loss.

The test is intended to help distinguish workers who are truly independent from those economically dependent on an employer — and therefore entitled to protections such as minimum wage and overtime under the Fair Labor Standards Act.

The National Association of Insurance and Financial Advisors is “encouraged” by the rule after years of back and forth, said CEO Kevin Mayeux.

“Many financial advisors operate locally as small business owners, employing others on their staff, and serving the members of their communities,” Mayeux said in a statement. “Reclassifying them as employees rather than independent contractors would have threatened their ability to best serve their clients and to ensure that their small businesses can operate efficiently.”

NAIFA lobbied for many years for an independent contractor rule that would allow its members to operate as they have for years. Mayeux criticized the 2024 rule as harmful for members.

“Among other harms, an analysis which is ambiguous or perceived as too restrictive of independent contracting can deter businesses from engaging with bona fide independent contractors or induce them to unnecessarily classify such individuals as employees,” he said.

Applies to other laws

The proposed rule also would apply the same criteria to other federal laws that rely on the FLSA’s definition of “employ,” including the Family and Medical Leave Act and protections for agricultural workers.

The change would help preserve the “entrepreneurial spirit” of independent workers while simplifying compliance for employers, said Labor Secretary Lori Chavez-DeRemer, particularly in sectors that rely heavily on contractor labor such as gig platforms, trucking and healthcare.

Dale Brown, president and CEO of the Financial Services Institute, echoed the need to preserve the independent contractor option for financial services.

“Our members have chosen the independent contractor model — many making the switch from an employee model — so that they can build their own businesses and better serve their clients,” Brown said. “It is crucial that advisors’ ability to choose the business model that best meets their professional goals and their clients’ needs is preserved.”

Other business groups have welcomed the move, arguing that the 2024 rule created confusion and litigation risk for employers. The American Trucking Associations praised the proposal as a step toward protecting the livelihoods of independent truckers.

Opponents of rolling back the stricter 2024 standard say doing so could weaken worker protections and make it easier for employers to classify workers as contractors instead of employees, potentially reducing wage and benefit safeguards.

The public has 60 days to comment on the proposed rule, with the comment period scheduled to close April 28.

Analysts say the outcome could have wide-ranging implications for millions of workers, especially in the gig economy, and signal a significant shift in federal labor policy.

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More than 1 million fewer people enrolled in Affordable Care Act marketplace coverage in 2026 than in 2025, and that number is expected to increase as the year progresses.

Enrollment data from the Centers for Medicare and Medicaid Services show that approximately 23 million people were enrolled in ACA coverage for 2026, down from 24.2 million in 2025. However, KFF said that many who signed up for coverage may end up dropping it after failing to pay higher premiums that took effect this year.

When enhanced ACA premium tax credits expired at the end of 2025, many ACA enrollees face sharply rising out-of-pocket costs.  This is leading people to either drop coverage or enroll in plans with lower premiums but higher deductibles.

Gross premiums on the ACA marketplace are up about 20%–22% on average, the Commonwealth Fund reported. What people actually pay after the tax credits are applied is up about $1,000 more per year, or an average increase of about 114%, according to KFF.

Some fear that if millions of healthy individuals leave the ACA marketplace, it could trigger a chain reaction that could push premiums higher for those who remain insured.

The result is a risk pool that becomes older, sicker and significantly more expensive to insure, placing upward pressure on pricing across the broader insurance system.

Cristin Bishop Hopkin is chief operating officer and insurance expert for The Brokerage Inc., a field marketing organization for life and health insurance. She told InsuranceNewsNet that she expects carriers who sell products on the ACA marketplace to begin adjusting their offerings to attract younger, healthier consumers into the risk pool.

“When premiums go up in price, healthy people in the 26- to 40-year-old age range are those most likely to give up their coverage,” she said. “It’s unfortunate, but you just give up your coverage, especially those in this age group, who are saving for their first home or trying to pay their school loans.”

Hopkin said she believes carriers in the ACA space “will go back to their drawing boards and bring out new plans.

“I think the actuaries are saying, We have to come up with alternate solutions to the ACA, and we have to be able to bring more out to the marketplace. I think we’ll start to see more different products, not necessarily within the ACA realm. I think we’ll start to see more private plans become available.”

Some ACA alternative plans could emerge

Proposed federal regulations announced earlier this month would certify some non-network health plans as qualified health plans under the ACA. In addition, CMS wants to allow insurers to offer catastrophic coverage in one-year terms or in longer terms of consecutive years, up to 10. The agency also proposes to rethink hardship exemptions for certain individuals over age 30, allowing more people to choose a catastrophic plan if they want to.

The proposed rule further aims to expand affordable options by allowing for plans that include lower deductibles but higher out-of-pocket maximums.

“I think we’ll start to see more carriers coming out with different types of plans that are available to fill the gaps,” Hopkin said. “Maybe someone was on a gold ACA plan previously, but because the premiums went up, have to drop down to a bronze plan, and so they just don’t have as much coverage. What an insurance agent is really good at doing is going in there and telling a client, ‘You have all these gaps. Now let’s take these other private plans and fill those gaps with cancer plans or hospital indemnity or other types of products that are out there.

“I definitely think carriers will start to come out with more of those to fill the gaps for these clients.”

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“There is no emergency,” Connecticut interim Insurance Commissioner Joshua Hershman wrote this week of the liquidation proceedings involving PHL Variable Insurance Co.

There is “no basis” for large policyholders to intervene in the process, and Judge Daniel J. Klau should deny such requests, Hershman added in a memorandum filed Tuesday.

SWS Holdings and BroadRiver Asset Management share the same frustrations: When former insurance commissioner Andrew Mais took over the financially troubled PHL in May 2024, he sought an accompanying moratorium that capped PHL benefits at $300,000. Large policyholders say the moratorium discriminates against them while not impacting smaller policyholders.

Mais retired on Nov. 28 and was succeeded by Hershman, who pivoted to liquidation in a Dec. 31 status update. That prompted renewed anger from SWS and BroadRiver, who filed emergency motions to intervene in the liquidation process.

The motions sought a total or partial premium holiday for their universal life policies, arguing they were misled into continuing payments under the assumption that a rehabilitation plan would sustain coverage indefinitely. The filing from Hershamn this week disputes those claims, saying the rehabilitator never promised ongoing coverage and has provided options to preserve policyholder claims during the receivership.

“The Movants’ narrative is false,” the filing reads, noting that the rehabilitator has been transparent that any rehabilitation plan would depend on a successful marketing process and would only proceed if it provided policyholders with greater coverage than a standard liquidation.

Efforts continue to pursue a transaction that would provide over-the-cap policyholders — those with benefits exceeding guaranty association limits — more coverage than they would receive in a standard liquidation, Hershman wrote.

The court previously denied a similar motion to intervene and approved modifications to a moratorium that allow policyholders to assert claims for premiums paid if they surrender their policies. The rehabilitator’s filing emphasized that the premium holiday sought by BroadRiver and SWS would be inequitable to other policyholders, particularly the majority with positive cash surrender values who have already prepaid premiums.

“The Moratorium Modifications approved by the court are the best and fairest path forward at the present time,” the filing states, adding that policyholders still have options to terminate policies and recover premiums paid under the approved plan.

Multi-million-dollar policies

SWS Holdings owns two Phoenix Generations universal life policies worth $18 million in death benefits, policies intended to fund an eventual stock purchase agreement. The company has paid more than $12 million in premiums to date, court documents say.

The BroadRiver policyholders have paid $57.1 million in premium payments, $19.7 million in the 19 months since Connecticut regulators began their rehabilitation of PHL Variable, their memo reads.

From the end of 2023 to September 2025, the amount of cash and short-term investments held by the PHL companies increased from $103 million to $437.5 million. Regulators fattened PHL’s coffers through the large premiums investors paid, the BroadRiver motion claims.

But Hershman’s memo says that the allegation is “false.”

The estate’s increase in cash during that period is primarily the result of three items having nothing to do with premium payments, Hershman said: A reimbursement of $100 million from the separate account to the general account for benefits the general account paid (post-rehabilitation) on behalf of the separate account; about $66 million in funds received from reinsurers; and about $81 million received from the sale of investments.

“Even if there were a legal basis for the Intervention Motion, the ultimate relief requested by Movants should be denied, because the premium holiday they seek is inequitable to other policyholders,” Hershman concluded. “It would have been inappropriate in a rehabilitation plan, it will be inappropriate in a liquidation plan, and it is inappropriate as part of this ongoing receivership case.”

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Americans who don’t have access to a 401(k) account through their employer could see that change under a proposal announced by President Donald Trump during his State of the Union address Tuesday night.

During his speech, Trump announced plans to offer Americans without 401(k) accounts the opportunity to access a plan like those available to federal workers.

Trump didn’t go into the specifics of the proposal, but he pledged to have the federal government match each participant’s contribution up to $1,000 annually. With the stock market hitting record highs, the president said, the opportunity to participate in a retirement account would “ensure that all Americans can profit from a rising stock market.”

Treasury Secretary Scott Bessent indicated that Congress could use the budget reconciliation process to advance Trump’s retirement proposal.

The secretary added that details of the plan would be rolled out “in the coming weeks and months.” He described the proposal as a tool to help working Americans “who have been left behind.”

About 40.6 million full-time private-sector workers in the U.S. – about half of this workforce sector – had no access to an employer-provided retirement plan as of November, according to the bipartisan Economic Innovation Group.

Industry groups praise Trump proposals

Meanwhile, industry groups praised many of the proposals Trump outlined in last night’s speech.

The National Association of Insurance and Financial Advisors said it shares President Trump’s goal of helping more Americans achieve financial security and build stronger retirement savings.

“Expanding access to retirement savings opportunities through both employer-sponsored plans and individual savings solutions is critical to addressing Americans’ growing concerns about their long-term financial futures,” said NAIFA President Christopher L. Gandy. “NAIFA looks forward to learning more about the administration’s proposed retirement savings initiative and working with policymakers to strengthen awareness, understanding, and use of the retirement plans and financial tools already available to workers and families.

“Financial professionals play an essential role in helping Americans translate new savings opportunities into real financial progress. Advisors provide education, personalized guidance, and long-term planning that help individuals make informed decisions and stay on track toward retirement security,” Gandy said.

‘Lasting financial security’

That same guidance will be critical as families navigate Trump Accounts, another initiative highlighted by President Trump and designed to help children begin building wealth early in life. Just prior to the State of the Union address on Tuesday, Gandy met with Treasury Department officials to discuss the important role financial professionals will play in helping families understand and effectively use these accounts to secure brighter financial futures for the next generation.

NAIFA recently submitted formal comments to the IRS emphasizing that financial professionals are essential to the long-term success of Trump Accounts. NAIFA encouraged policymakers to ensure families have access to professional guidance, broader investment flexibility, and clear regulatory treatment so these accounts can achieve their full potential as lifetime savings vehicles.

“Public policy can create opportunity, but trusted financial guidance helps families turn opportunity into lasting financial security,” Gandy said. “NAIFA members stand ready to help Americans navigate new savings options and build confident financial futures for themselves and their children.”

Finseca CEO Marc Cadin issued a statement praising the retirement plan.

“We applaud President Trump for raising the national conversation around financial security in his State of the Union address,” he said.

“The President’s message reinforces a simple truth: financial security does not happen by chance — it requires a plan. Finseca looks forward to working with the administration to expand access to financial planning and help more American families gain peace of mind.”

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Current annuity illustrations from top sellers show returns as high as 27% in one year, said Ben Slutsker, director of life actuarial valuation at the Minnesota Department of Commerce.

Slutsker noted the juicy illustrations Tuesday during the first meeting of the newly named Life Insurance and Annuities Illustrations Working Group.

Created at the National Association of Insurance Commissioners’ fall meeting in November, the working group will: “Evaluate concepts for improving life insurance and annuity illustrations and disclosures, and consider revisions to relevant NAIC models or develop other guidance where feasible and appropriate.”

Tackling illustrations is sure to be a lengthy and difficult process, as illustrations have become a de facto sales tool for complicated life insurance and annuity products. Slutsker acknowledged the FOMO factor among life and annuity sellers.

“It’s not just a few companies that are showing higher rates,” he explained. “If a company wants to compete in this space, they’re put in a tough position. Because to just get those sales, they might be forced to show some of the higher illustrated rates just to compete with others.”

The working group exposed for 30 days a statement on illustrations asking, among other things, “what are both short term and long term approaches to ensure consumers receive reasonable expectations for index annuity investment returns at the point of sale?”

High illustrated returns

At the center of the discussion are indexed annuity illustrations that show high historical returns, often paired with downside protections such as a 0% floor in fixed indexed annuities, or FIAs.

Regulators said they have informally collected illustrations from roughly 25 to 30 of the top annuity market leaders. A preliminary review found that about one-third of companies showed highest illustrated annual returns of 10% or lower. The remaining two-thirds showed at least one product or index with illustrated returns above 10%.

Of those above 10%, roughly half fell in the 11% to 15% range, while the rest ranged from 16% to as high as 27%, Slutsker said.

Officials emphasized that the figures reflect the highest illustrated annual investment rates across products and indices for each company, not the rates shown for every scenario. Most illustrations also include guaranteed scales and less favorable scenarios, including years with zero returns.

However, regulators said the higher figures often reflect “recent history” scenarios, with even higher projections sometimes shown under more favorable assumptions. The returns cited include both index crediting rates and internal rates of return that factor in charges and cash surrender values.

Back-tested indices a focal point

Regulators said many of the highest illustrated FIA returns appear to rely on “back casting,” where recently created proprietary indices are presented as if they had existed for a decade or more.

In some cases, disclosures identifying an index as recently created appeared prominently in footnotes; in others, they were located deep within the illustration materials or not clearly identified at all, regulators said. Some indices were identified as new only after independent research.

Nearly all of the highest FIA illustrated rates reviewed involved back-tested indices, regulators said. By contrast, none of the indexed products structured as registered index-linked annuities, or RILAs, reviewed used back casting, Slutsker said, though some RILA illustrations still showed returns in the 15% to 20% range.

“Whatever’s been going on has been misleading for many years, and there should be a limit on what they can assume is earned from the derivatives,” said Bill Carmello, chief life actuary for the New York State Department of Financial Services. “What we accepted on life side was way too much. It should be like maybe 10% higher than the normal earnings.”

Consumer representatives and regulators raised concerns that consumers may focus on the higher illustrated returns while discounting guaranteed minimum scenarios.

Comparisons to securities rules

Participants also noted a disparity between annuity illustrations and those used in indexed life insurance. Current indexed life illustrations often show returns in the 5% to 8% range, regulators said, citing existing guardrails such as the existing illustrations model reg adopted in 1995, as well as Actuarial Guideline 49, which limit illustrated rates and methodologies.

On the annuity side, regulators referenced Model Regulation 245, which restricts illustrations for indices that have existed for less than 10 years, but noted that it has been adopted by only 10 states.

Some regulators pointed to federal rules governing variable annuity illustrations, including limits on hypothetical rates of return, and suggested the group review whether similar guardrails could apply in the fixed indexed annuity space. Others cautioned that indexed annuities differ structurally from securities products and that any regulatory approach should reflect those distinctions.

Broader questions about illustrations

Industry representatives said the proliferation of proprietary volatility-controlled indices has contributed to higher illustrated returns, particularly in the FIA market. With more than 200 such indices in circulation, many are relatively new and rely on back-tested data.

“We call them fake indexes,” said Larry J. Rybka, chairman and CEO of Valmark Financial Group. “Some of these indexes have actually returned zero in ’23, ‘24 and ’25, so talk about a bait-and-switch for consumers. I think that these need substantial reform in how they’re illustrated.”

Consumer advocates raised broader questions about the role of illustrations, asking whether they are meant to explain how a product works or to project likely outcomes. Some called for research into how consumers interpret annuity illustrations and disclosures, particularly as more tools move online and can generate projections without an advisor present.

Other participants urged regulators to consider whether high illustrated returns are influencing not only accumulation expectations but also income riders and long-term care benefits embedded in some products.

Slutsker urged everyone to focus on ‘high-level” concepts.

“We’re really just looking to get the ball rolling,” Slutsker said. “We want to hear from all different perspectives and remain open-minded as we think through potential solutions.”

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A groundbreaking case of a legal-tech company’s artificial intelligence successfully settling a personal injury claim directly with an insurer, without the use of a lawyer, could be the start of a game-changing new trend for American consumers and the larger insurance landscape.

“We are now, for the first time, giving consumers AI to negotiate with the insurance company’s AI to reach a faster, fairer settlement without the consumer having to pay any money to an attorney or anybody else, period,” Joshua Schwadron, founder and CEO of Mighty, said.

Mighty is a New York-based company that uses AI technology to handle personal injury property/casual claims completely digitally. Its platform is free for consumers to use, helping them reach settlements faster and with less hassle — and helping insurers save on legal costs too.

Schwadron said the company was formed after he realized “a lot of the innovations that happen in personal injury are not passed onto the consumer; they are just taken by the personal injury lawyer, who often makes more money.”

“A lot of personal injury cases are straightforward and shouldn’t have a lawyer taking 33% to 40% when there’s no legal work to be done. What we are doing is bringing the innovations directly to consumers to allow them to settle directly with insurance companies and get justice after an accident,” he explained.

He added that this process is increasingly being negotiated entirely by AI, both from Mighty’s side and from the insurers to be settled with.

“When our AI agents interact with insurance companies, they often send us a disclosure that says their responses may be generated by an AI agent. In talking to industry leaders and insurance, we know that most or all insurance companies are leaning heavily on AI to help respond to and resolve personal injury claims,” Schwadron said.

“The most efficient future of resolving claims is by a consumer’s AI and an insurance company’s AI finding a fair middle ground that can result in lower costs and more efficiency for all.”

What does an AI-to-AI claim settlement look like?

Mighty is built on Open AI, the same technology powering ChatGPT. However, Mighty also has proprietary datasets and methods for updating the language model to incorporate decades of experience from claims adjusters, paralegals, lawyers and personal injury expertise.

“An accident victim comes to our software and we import their accident report, their police report, their medical records and other details. We tell them what their claim is valued at. Then, our AI agent reaches out to the auto insurer to send that information in essentially a demand package and then asks the insurer to make an offer. Our AI then works with the consumer to negotiate that offer,” Schwadron explained.

There are no humans involved from Mighty’s side, he said. If the AI agent is able to reach a successful settlement with the insurance company, or its AI, the consumer gets to keep 100% of the settlement instead of having to pay legal fees.

If Mighty’s AI agent can’t work out a resolution, it will help the consumer escalate their case to a vetted personal injury lawyer. Even this escalation process is done completely online, all through the AI agent — the consumer never has to do actual valuation, outreach to the insurance company or settling.

In Schwadron’s opinion, consumers have historically been faced with “two bad choices” after an accident: either settle directly with an auto insurer, “in which case the auto insurer is licking their chops because they are a repeat defendant who knows the tricks of the trade and is going against an unrepresented consumer,” or hire a personal lawyer and “give that lawyer 33% to 40%, even though they might not actually need legal help.”

“There has never been an alternative. There has never been a third option. Mighty has developed AI that gives a consumer a third option,” he said.

Larger impact

Looking at the bigger picture, Schwadron believes that AI-to-AI claims settlement could become more common and result in “a lot less litigation” in the future.

“Increasingly, what’s going to happen is that the straightforward cases, which are the vast majority, will be resolved with AI and only the exceptional cases will require deep human involvement,” he said.

While acknowledging that less litigation translates to “a lot fewer people needed in the claims industry,” he underscored that there will always be “cases that are complicated, where the facts are disputed, that are going to require human-level analysis and judgment.”

“I think that it will mean the insurance companies pay out lower settlements, but that consumers actually get more than they did in the old paradigm, where lawyers took a hefty chunk of a settlement that an insurance company paid out,” Schwadron said.

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Genworth Financial is no longer on the defensive thanks to its growing CareScout platform and its return to the individual long-term care insurance market after nearly a decade away.

The standalone Care Assurance LTC product launched in October and is live in 40 states, with four more pending approval. It comes with conservative pricing and benefit limits to avoid the steep premium hikes seen in Genworth’s legacy policies.

CEO Tom McInerney and his executive team met with Wall Street analysts Tuesday morning to discuss fourth-quarter and full-year 2025 results. It was a one-sided presentation that generated no questions, extremely unusual for an earnings call.

“CareScout represents our long-term growth strategy and our vision for how agent care should work in the future,” McInerney said. “We are building an innovative, consumer-focused platform that helps people understand and find the quality long-term care they need, while creating a capital-light, scalable, data-driven business for the future.”

While headline profits remain elusive, investors like what Genworth is doing. Company shares rose more than 3% on Tuesday morning.

Beginning with the fourth quarter of 2025, Genworth is breaking out its reportable segments into two main areas: Enact, its private mortgage insurance products; and Closed Block, its long-term care insurance, life insurance and annuity products.

Enact served as the primary profit engine, with $558 million in profit for the year, while the Closed Block segment reported significant operational losses (-$317 million) due to legacy insurance challenges.

Efforts to stabilize the closed blocks of LTCi policies continue, McInerney said. Genworth received $100 million of LTCi premium approvals in the fourth quarter, and $209 million for the full year, he explained, with average premium increases of 35.6% and 38%, respectively.

“We are in the 13th year of a multi-year rate action plan, which has achieved $34.5 billion in net present value since 2012, driven primarily by benefit reductions and premium increases,” McInerney said.

In Other News

Seniorly acquisition. CareScout closed on its acquisition of Seniorly Inc. during the fourth quarter. Seniorly is a leading technology platform and advisor network that connects families with senior living communities and resources. Over the coming months, Seniorly, its advisor network and partners will transition to the CareScout platform, Genworth said in a news release.

The acquisition was funded from Genworth’s existing holding company cash, with total cash consideration amounting to approximately $15 million.

The acquisition of Seniorly “strengthens CareScout’s direct-to-consumer capabilities and accelerates its strategic roadmap to simplify and dignify how families understand, find, and pay for long-term care,” the release said.

“Seniorly’s team has brought deep industry and consumer experience, accelerating our efforts to scale beyond Genworth’s pre-existing policyholder base and add senior living options to our network,” McInerney said.

Quarterly Snapshot

• Closed blocks of LTC, life and annuities lost $114 million in the quarter, up from a $96 million loss in the third quarter and a $99 million loss in the year-ago quarter.
• Home care network includes 1,058 locations across 789 providers, up 60% from the fourth quarter of 2024.
• Closed blocks of life, $13 million, and annuity, $32 million, returned profits based on favorable annual assumption review updates.
• The corporate segment reported a $24 million loss, driven by continued investment in CareScout and debt service, partially offset by favorable tax-related items.

Management Perspective

“CareScout is building a human-centered, tech-enabled platform to simplify and dignify the aging journey. Our approach combines AI and digital technology with a human touch and reflects our deep expertise in delivering high quality, personalized support for long-term care decisions.”

CEO Tom McInerney on Genworth’s use of AI

By The Numbers

• Net Income: $2 million (-$1 million in Q4 2024)
• Adjusted Operating Income: $8 million ($15 million in Q4 2024)
• Earnings Per Share: $0.02 per share ($0.04 per share in Q4 2024)
• Share Repurchases: $94 million in Q4 2025
• Dividend Declared: None
• Stock Price Movement: Shares up about 3% at midday Tuesday

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