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AGENTS' GROUP RESPONDS TO CRITICISM OF LIFE INSURANCE INDUSTRY

 AGENTS' GROUP RESPONDS TO CRITICISM OF LIFE INSURANCE INDUSTRY
 WASHINGTON, June 23 /PRNewswire/ -- Mike Nicholson, CLU, ChFC, president of the National Association of Life Underwriters (NALU), issued the following statement today in response to charges directed at life insurance agents and companies at a hearing chaired by U.S. Sen. Howard Metzenbaum (D-Ohio):
 Contrary to the bleak picture painted by Senator Metzenbaum, the majority of Americans today enjoy excellent service and value from their life insurance agent and company. For the most part, the senator has recycled the same sweeping, but largely unsubstantiated, generalizations leveled against the industry over a decade ago.
 Even as far back as 1979, an FTC-commissioned study by Purdue University showed that insurance buyers were perfectly capable of making intelligent purchasing decisions with then-available information. Since that time, the industry and the National Association of Insurance Commissioners have worked diligently to simplify language, standardize policies, protect consumers and vastly expand access to information about insurance.
 Today, insurance buyers have more choices and sources of information available to them than ever before. And at no point in our history has the life insurance sales force been better educated and more exacting in its professional standards.
 With regard to policy illustrations, NALU firmly believes that sales illustrations of interest rates should be based on the current rates being paid by a company. We support model regulations for sales illustrations as adopted by the National Association of Insurance Commissioners. We also believe the reliability of sales illustrations has been significantly enhanced by generally declining interest rates.
 In addition, NALU has always supported relevant, understandable and equitable disclosure of policy information so that buyers can make informed and intelligent decisions.
 However, we do not believe that cost alone should be the determining factor in the buying process. Other variables such as the amount and kind of coverage needed, the caliber of counseling and service provided, and the financial stability of the company should be considered as well. This is particularly the case with regard to commission rebating and so-called "discounted" policies which emphasize price at the expense of quality, sound advice and long-term protection.
 NALU, founded in 1890, is a federation of 1,000 state and local life underwriters associations. The 139,000 members of these local associations are sales professionals in life and health insurance and other related financial services.
 -0- 6/23/92
 /CONTACT: Jay Morris of the National Association of Life Underwriters, 202-331-6030/ CO: National Association of Life Underwriters ST: District of Columbia IN: INS SU:


MH -- DC016 -- 2858 06/23/92 12:39 EDT
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Publication:PR Newswire
Date:Jun 23, 1992
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