2014 Insurance Review
Knights of Columbus Insurance By e Numbers
14 39 2,000,000 $21,000,000,000 $96,000,000,000 consecutive years of growth
consecutive years of ratings excellence (A++, Superior) from A.M. Best
contracts in force.
more than
more than
in assets under management
more than
of insurance in force
One founding mission: to protect members and their families from financial devastation
2 v 2014 Insurance Review
All numbers as of 12/31/14.
Year in Review 2014 was a special year of milestones for the Knights of Columbus Insurance program. Bookended by our 13th and 14th consecutive years of sales growth, 2014 was full of accolades and achievements that demonstrated our commitment to continuing Father McGivney’s mission of providing financial protection for Catholic families. The achievements began in January when the Order announced that the more than $8.15 billion of life insurance sales in 2013 marked a 13th consecutive year of sales growth, despite a persistent stagnant economic environment. ™
Two months later, in March, the Order was singled out as a 2014 World’s Most Ethical Company by the Ethisphere Institute. The Knights of Columbus was one of only two life insurance companies to receive the honor, which is based on an evaluation of a company’s ethics and compliance program; reputation, leadership, and innovation; governance; corporate responsibility and citizenship; and culture of ethics.
®
“This is a tremendous, tremendous achievement,” said Chief Insurance Officer Thomas P. Smith, Jr., “and I think every member of our field force can join the Home Office staff – and truly every member – with pride in this recognition. The work that this organization does every day and night reflects the core beliefs of our founding so completely, that we would not have expected anything less than this honor.” In June, the Knights retained its position on the Fortune 1000 list, coming in at 935. Later that month, the Knights celebrated another achievement when, for the 39th consecutive time, the Order earned ratings agency A.M. Best’s highest rating (A++, Superior) for financial strength. There continues to be no more highly rated life insurer in North America than the Knights of Columbus. In August, the Order passed a major insurance in-force milestone when it reached $95 billion of life insurance in force, an increase of nearly $50 billion in the last decade.
2014 Insurance Review v 3
“This milestone isn’t just a number,” said Supreme Knight Carl Anderson, “it’s an indication that we are protecting even more Catholic families and continuing the mission of our venerable founder, Father Michael J. McGivney. Every dollar of top-rated insurance that our professional agency force adds means real, meaningful security for the families we help protect.” And, in the final quarter of 2014, the Knights exceeded 2,000,000 policies in force. But the business did not just excel in numbers in 2014, the Order also launched a whole host of new products and services, including: Accelerator Term Insurance, Long-Term Care Plus, Young Adult Insurance, Disability Income Household Benefit Coverage, and the Personal Planning Workbook. The Order also improved its field force in 2014, welcoming more than 15 new General Agents across North America, and contracting hundreds of new field agents to more fully staff our agencies. There are now more contracted Knights of Columbus agents than ever before. The Knights of Columbus officially closed out 2014 with more than $8.2 billion of life insurance sales, 90,444 contracts, and an in-force total in excess of $96 billion — well on our way to $100 billion of life insurance in force.
LIFE INSURANCE IN FORCE
LIFE INSURANCE SALES (BY VOLUME) 8 $BILLIONS
100 $BILLIONS
78,951,088
7,777,700 2010
2010
83,505,896
7,976,289 2011
2011
88,367,568
8,116,011 2012
2012
92,641,541
8,154,828 2013
2013
8,242,597 2014
4 v 2014 Insurance Review
96,744,442 2014
Product Enhancements 2014 saw the rollout of several new products and features to better serve Knights and their families. Accelerator Term The cutting-edge Accelerator Term Series was the Order’s biggest product launch in 2014, and it’s biggest since the introduction of Disability Income. Replacing our existing level term products, Accelerator Term offers traditional 10, 15, and 20 year level term policies with a number of attractive features. Price: Accelerator Term has additional features and benefits not offered by any other company, yet the product is priced very competitively. The per thousand unit price was reduced at most ages versus the existing plan for the majority of the nontobacco rating classes. Age: Issue age for Accelerator Term was extended to age 70, and the coverage itself renews all the way to age 85. Issue ages for the 10 year are 18-70. Issue ages for the 15 year are 18-65. Issue ages for the 20 year are ages 18-60. At 80, the coverage continues at annual yearly renewable term rates until age 85. Acceleration: Accelerator Term products include a five percent increase in the face amount of the policy for the first five years, equal to 125 percent of the initial face amount to help meet increasing needs. Insureds can opt out of the increases. Conversion: Full conversions are available for the first six policy years, guaranteed, regardless of issue age. With Accelerator Term, the insured can also elect to convert the additional 25 percent of coverage immediately, without having to wait for the annual increases. If the insured elects to include the new Full Term Conversion Rider at purchase, he or she can convert the entire face amount through the end of the level term period, or the contract date nearest age 65, whichever comes sooner. Partial conversions are also available.
2014 Insurance Review v 5
Long-Term Care Plus 2014 also saw the re-launch of the Order’s Long-Term Care product. Available in most states and in all of Canada, the new Long-Term Care Plus features a number of key changes and enhancements, including: Issue Ages: Just as the Accelerator launch opened the door by extending issue ages, so too did the announcement of Long-Term Care Plus, by allowing members and their eligible family members to buy younger. Members and their eligible family members ages 18-75 can now purchase the product. Underwriting Classes: Long-Term Care Plus features three classes: Premier, Select, and Standard. Benefit Durations: Applicants can now choose from a 3 year, 5 year, or 10 year benefit.
KNIGHTS OF COLUMBUS ®
Long Term Care
PLUS
Extended Daily Benefit Amount: Under Long-Term Care Plus, insureds can now have up to a $500 daily benefit amount on a single application. Increased Spousal Discount: Spousal discounts went from 10% (if one applies) and 15% (if both apply, and accept coverage) to 15% and 30%. New Inflation Rider Option: In addition to the traditional 5 percent inflation rider, a new 3 percent option was added. Return of Premium Rider: With Long-Term Care Plus, the Return of Premium on Death Prior to Age 65 rider is now included — at no cost — for all policies where the issue age is 64 or less. Young Adult Insurance In an effort to meet the unique needs of members (and their spouses) ages 18-29, the Order launched a new marketing initiative: The Young Adult Insurance Program. The program offers term insurance ($25,000 or $50,000 only) either through an online Request for Quote or directly from an agent. A streamlined application is also used.
6 v 2014 Insurance Review
Disability Income Household Benefit Coverage Launched in early 2014, the Order’s DI Household Benefit Coverage protects a member’s family from the disability of a nonworking or part-time working spouse. The program provides a $500 monthly benefit, with a 2 year benefit period and a 90 day or greater elimination period for an eligible, nonworking or part-time working spouse.
Service Enhancements The Order also launched a number of new service enhancements and features in 2014. They included: Personal Planning Workbook The Personal Planning Workbook is a comprehensive planning guide, that helps members and their families record personal information, identify personal wishes, and supplement legal documents. Offered exclusively to our members through a meeting with a Knights of Columbus Field Agent, the Book is a tremendous – and complimentary – resource for members. It is available in English or Spanish in the U.S., and English or French in Canada.
2014 Insurance Review v 7
1 COLUMBUS PLAZA • NEW HAVEN, CONNECTICUT 06510-3326 • TEL. 203-752-4000 • WWW.KOFC.ORG
10210 2/15