Category Insurance

“A Canadian’s best tax haven: The US” by Robert Keats

Despite the recent story about one of the Facebook founders giving up his US citizenship to move to Singapore for tax reasons, according to Robert Keats, in his latest book, he suggests that for Canadians in search of a tax haven (and warmer climate) US is the superior destination compared to traditional tax havens; and […]

The Pursuit of Risk Management

 In a Nutshell Risk is unavoidable; it is part of life. There are known, unknown and unknowable risks. The best we can hope for is to undertake the pursuit of risk management, in order to minimize the impact to the best of our understanding and abilities. -the probability and financial impact of a risk determines […]

Pure longevity insurance payout option in CPP would reduce retirees’ longevity risk

Adding a pure longevity insurance payout option to the CPP would go a long way to ease the pain of private sector employees with disappearing pensions. This blog adds some meat to the proposal I mentioned in last week’s PRPP or expanded CPP? Consider adding a pure longevity insurance payout option to the CPP. The PRPP doesn’t meet […]

‘RIP’ GMWBs? Who will miss these lose-lose products?

There were a number of recent articles indicating that insurance companies are exiting the GMWB business. The latest in the past week were MSN Canada’s  “Insurers back away from “income for life” products”, Benefit Canada’s   “Say goodbye to GMWB as you knew it” and WSJ’s  “Hartford says goodbye to annuities”. According to these articles (and references therein) Desjardin, Standard […]

GMWB III – Q & A: Are GMWBs more desirable investments in “post-2008” context of low interest rates?

Last week I received the following question on GMWBs (Guaranteed Minimum Withdrawal Benefit insurance products) that I discussed in earlier blogs. Question:  “GMWB discussions. Time to update your conclusions. Outdated pre-2008 markets. Inflation numbers of 3%, GIC numbers of 5%?  Will be interested to see part III of this.” Answer: It’s a good question, since […]

Long-Term Care Insurance (LTCI) II- Musings on the Affordability, Need and Value: A (More) Quantitative View

Long-Term Care Insurance (LTCI) II- Musings on the Affordability, Need and Value: A (More) Quantitative View (Originally posted September 2009, re-hosted in March 2012)  Last January in Long-Term Care Insurance- An OverviewI looked at LTCI policies. I promised at the time that I’ll do another more quantitative blog on the subject “shortly”. Since last January much […]

Long- term Care Insurance (LTCI- I)

Long- term Care Insurance (LTCI- I) (Originally posted in January 2009, re-hosted in March 2012) A couple of months ago a reader asked what I thought about LTCIs. Not being well versed on the subject I started reading about them and the more I read, the more it became obvious why people are so confused […]

GMWB II- Guaranteed Minimum Withdrawal Benefit II

GMWB II- Guaranteed Minimum Withdrawal Benefit II This is a follow-up to the GMWB I blog of a few weeks ago, where I also described the characteristics of typical GMWB products. Here I will compare various decumulation options with the hypothetical GMWB product described earlier and various parameters. This will get a little technical, but […]

GMWB I – Guaranteed Minimum Withdrawal Benefit (Preliminary)

GMWB I – Guaranteed Minimum Withdrawal Benefit (Preliminary)   I have received questions about Guaranteed Minimum Withdrawal Benefit (GMWB) products from a number of individuals. So this is the first of a couple of in-depth blogs on the subject. (Follow-up blogs are available at GMWB II- Guaranteed Minimum Withdrawal Benefit II, GMWB III – Q […]

Longevity Insurance- What does it buy you?

Longevity Insurance- What does it buy you?   As mentioned often, retirees are exposed to three major risks: (1) longevity risk, (2) inflation risk and (3) market risk. In many ways these three risks are intertwined and they all lead to the possibility of running out of money and/or significantly reduced standard of living before […]