Archive for March, 2022

Miller & Newberg Ranked by A.M. Best as a Top Actuarial Firm

Annually, Best’s Review magazine publishes a list of the industry’s top actuarial firms. Miller & Newberg is pleased to report that in the survey released in the magazine’s December 2021 issue, we were listed as the fourth largest annuity and life insurance actuarial firm in the U.S. and Canada based on the magnitude of our client companies’ reserves, and the third largest firm based on the number of client companies.
 
The Best’s Review ranking is based on objective, verifiable criteria: A.M. Best reviews the annual statement of every insurance carrier in the industry that files its annual statement with them to determine who is each company’s appointed actuary, i.e., the actuary who provides the annual statutory actuarial opinion regarding the insurer’s policy and claim reserves.
 
The survey reveals what we know about ourselves at Miller & Newberg, that we go well beyond helping to fill out our clients’ financial statements. We are strategic partners in helping our client companies find ways to grow profitably.
 
From the report, compared to the previous year’s report:

  • Only about half of the top 25 firms had their clients’ total reserves grow since the prior survey. Miller & Newberg was one of those firms.
  • Only five of the top 25 firms added a new client company since the prior survey. Miller & Newberg was one of those firms.
  • Only three of the top 25 firms have at least a dozen client companies with their client companies averaging over $250 million in reserves. Miller & Newberg was one of those firms.

As Eric Newberg, President & CEO, says, “Our clients choose us because of the expertise we have that comes from working with many companies, but also because they get a level of service and partnership that makes each client feel like they are our only client.”
 
When your company is ready to grow, give us a call. We would be thrilled to help you.
 
Here is a link to the report: https://news.ambest.com/articlecontent.aspx?refnum=314792

COVID-19 Deaths: 2021 Was Worse than 2020. Should Pricing Change?

At Miller & Newberg, we are committed to providing our clients with the best possible information to make decisions that help their businesses prosper. COVID-19 is a classic example of a risk that impacts the entire industry, and company executives naturally wonder whether what is happening at their company is happening to the same extent with their peers, and what should they do about it?
 
As the fourth largest annuity and life insurance actuarial firm in the U.S. and Canada based on the magnitude of our client companies’ reserves, and the third largest firm based on the number of client companies, our data at Miller & Newberg is very credible when it comes to insured lives mortality.
 
Most of our client insurance companies and fraternal benefit societies are seeing their overall death claims remain elevated. In 2020, our client companies collectively experienced death claims 12% higher than a normal year, and 2021 was unfortunately slightly worse at 13% higher than normal:
 
Client Death claims
 
As to population mortality, looking at data from the CDC (the Centers for Disease Control and Prevention), in 2020, the United States experienced a death rate about 19% higher than a normal year, and 2021 was 21% worse than a normal year:
 
US Death Rate
 
Whether companies realize it or not, their elevated death claims are almost certainly due to COVID-19, even if their internal data shows few claims listing COVID-19 on the death certificate.
 
The next question is, how should companies react? After all, if COVID-19 continued to cause elevated death rates throughout 2021 even though vaccines and better treatments were available, we should start to wonder whether product pricing needs to reflect this experience continuing.
 
We can see from the CDC data that COVID-19 deaths in the second half of 2021 were alarmingly close to the figures from one year prior.
 
US Quarterly Death Rate
 
But as to what 2022 will bring, we see two very interesting facts when we look at CDC data on COVID-related hospital admissions. First, January 2022 was actually the single worst month for these hospital admissions since the pandemic started. But second, as of March 17, these hospital admissions were down 90% since their peak. See this chart, which was taken from ” https://covid.cdc.gov/covid-data-tracker/#new-hospital-admissions:”
 
US hospital admissions
 
We conclude that COVID-19 death claims remain an issue for the life insurance industry, and we will likely see elevated death claims when first quarter 2022 results come in. But it is entirely possible that death rates hereafter will fall much closer to historical norms.
 
At this point, we have not seen the industry as a whole make any significant life insurance pricing changes as a result of COVID-19. Carriers are generally treating COVID-19 as a point in time event that will not change mortality over the long run. Time will tell, and Miller & Newberg will remain vigilant in tracking the data and helping our clients make the best decisions in light of it.