Living benefit riders to life insurance policies: Pricing considerations and strategy
Adding benefit riders to policies provides meaningful coverage for those who need it, and carriers usually can do so at a relatively low cost.
The FTSE 100 index lost 4.7% during the month, down 24% year-to-date, and the Euro Stoxx 50 ended the month down 7.3% as markets reacted to COVID-19 spikes. In global equity markets, the MSCI emerging market index gained 2.1% at month-end, while the US S&P 500 and the Japanese Topix indices lost 2.7% and 2.8%, respectively. Despite the losses, the S&P 500 remains up 2.8% year-to-date. The British Pound had a mixed performance in October, losing 0.5% against the Japanese Yen, while gaining 0.9% and 0.3% against the Euro and the US Dollar, respectively. GBP and EUR CRAs remained unchanged at 13 and 10 basis points, respectively. UK’s CPI inflation measure rose by 30 basis points to 0.5% in September. Realised volatility of most major indices increased in October, due to the impending US elections and concerns about COVID-19. However, the FTSE 100 index experienced a decline in realised volatility to 17.8% by month-end.
Milliman Market Monitor London - 30 October 2020
Most major equity indices experienced material losses in October, as the rising number of COVID-19 cases forced some European governments to introduce new lockdown restrictions, while emerging markets outperformed their developed market counterparts.