Continuing low interest rates remain the primary concern of nearly half of the chief financial officers at North American life insurance companies, according to a new report.
Professional services firm Towers Watson (NYSE, NASDAQ: TW), New York, released this finding in a summary of results from a survey of North American chief financial officers. Thirty CFOs, 19% of the 162 CFOs invited, participated in the research, titled, “Life Insurance CFO Survey: Low Interest Rate Environment.”
Nearly all respondents (96%) say they have reduced their minimum guarantee on fixed-account products. More than half (56%) have adjusted premium rates, reduced living benefit guarantees or adjusted fees on annuity products (56%). Or they have ceased or significantly curtailed sales of some products (54%). One-quarter have exited product segments, and another 13% plan to do so in the next six months, the survey finds.
Despite their unfavorable near-term outlook on the economy, CFOs are more optimistic about improvements in their financial results.