Note: Descriptions are shown in the official language in which they were submitted.
CA 02910495 2015-10-28
Self-Directed Insurance Accounts
TECHNICAL FIELD
[0001] The present disclosure relates to computer systems and software that
implement algorithms and other operations for combining electronic life
insurance policy
accounts and self-directed investment accounts.
BACKGROUND
[0002] Life insurance is a contract between a policy holder, and an insurer,
where
the insurer promises to pay a designated beneficiary a sum of money in
exchange for a
premium upon the death of the insured person(s) listed in the policy. The
policy holder
typically pays the premium as a lump sum or on a periodic, regular basis. Life
insurance
policies are legal contracts with terms that define the limitations of insured
events, often
including specific exclusions to protect the insurer and limit their
liability. Life insurance
policies include term insurance and permanent life insurance policies (e.g.,
whole life,
universal life, and variable life policies).
[0003] Permanent life insurance is life insurance that remains active until
insured's death, unless the policy owner fails to pay the premium when due.
Permanent
insurance policies can accumulate cash values, which the owner can access by
withdrawing money, borrowing against the cash value, or surrendering the
policy and
receiving the surrender value.
[0004] Universal life insurance is a type of permanent life insurance. Under
universal life policies, the excess of the premium payments above the current
cost of
insurance and any fees and taxes is credited to the cash value of the policy.
The cash
value is credited each month with investment income, while the policy is
debited each
month by a cost of insurance charge and other policy charges and fees.
[0005] Self-directed investment accounts allow account owners to direct their
own accounts by selecting from a range of investments. In some instances, a
portion of
the funds within may include a managed account context, or an account where a
manager
can assist the account owner in selecting funds or making investment
decisions.
Permanent life insurance policies are not associated with self-directed
investment
accounts and instead can typically only hold a limited number of investment
vehicles,
CA 02910495 2015-10-28
which are generally limited to guaranteed return interest rates,
professionally managed
funds or market indices. Self-directed accounts provide flexibility to the
account owner
in allowing funds to be distributed and invested in owner-specified accounts
and
investments.
SUMMARY
[0006] The present disclosure involves systems, software, and computer-
implemented methods for providing combined life insurance policies with self-
directed
investment accounts. The system may include a life insurance platform
including at least
one processor that executes operations to maintain a life insurance policy for
a user, the
life insurance policy associated with a cash value that is backed by
investment assets.
The system may also include a user-directed investment account platform
including at
least one processor that executes operations to maintain a user-directed
investment
account associated with the life insurance policy, wherein the user-directed
investment
account can be funded with a cash account and/or a margin account based at
least in part
on an initial cash value of the life insurance policy. At least one of the
life insurance
platform and the user-directed investment account platform can determine a
delta of the
value of the investment assets backing the cash value of the life insurance
policy and
modify the value of the margin account based on the determined delta. The user-
directed
investment account platform can identify the modified value of the margin
account, store
the modified value of the margin account, and update the user-directed
investment
account based on the modified value of the margin account. Further, the user-
directed
investment account platform can provide a web-based interface for providing
information
related to the user-directed investment, wherein the web-based interface
presents account
details of the user-directed investment account, access the life insurance
platform to
identify information related to the life insurance policy, and present, via
the web-based
interface, at least a portion of the identified information related to the
life insurance
policy with the account details of the user-directed investment account.
[0007] In some instances, the user-directed investment account platform can
distribute investment assets associated with the life insurance policy based
on direct
instructions from the user. In some instances, the distribution of investment
assets
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comprises a series of periodic loans against the value of the margin account
used to fund
periodic income payments to the user. In some instances, the life insurance
platform is
maintained by a first entity providing life insurance policies, and wherein
the direct
investing platform is maintained by an investment firm. In some instances, the
direct
investing platform is managed by a third-party administrator distinct from the
first entity
managing the life insurance platform.
[0008] In some instances, the identified information related to the life
insurance
policy is presented seamlessly in-line with the account details of the user-
directed
investment account. At least a portion of the funds in the user-directed
investment
account may be used to pay at least a portion of premiums for the life
insurance policy.
[0009] In some instances, the user-directed investment account platform can
electronically and/or via telephone-based instruction invest funds in the user-
directed
investment account in one or more of the following: individual equities,
options, bonds,
money market offerings, mortgage-backed securities, real estate-backed
securities, real
estate investment trusts (REITs), exchange-traded funds (ETFs), mutual funds,
index
funds, and precious metal certificates.
[0010] The life insurance policy may be a universal life insurance policy in
some
implementations. The value of the margin account can be a pre-determined
percentage of
the cash value of the life insurance policy. In some instances, the margin
account
includes at least one asset other than the value of the life insurance policy.
Additionally,
the margin account is calculated, at least in part, on at least one asset held
in a different
user-directed investment account.
[0011] While generally described as a system, some or all of the aspects may
be
computer-implemented methods, computer-implemented software embodied on
tangible
media that processes and transforms the respective data, or included in
respective systems
or other devices for performing this described functionality. The details of
these and
other aspects and embodiments of the present disclosure are set forth in the
accompanying drawings and the description below. Other features, objects, and
advantages of the disclosure will be apparent from the description and
drawings, and
from the claims.
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DESCRIPTION OF DRAWINGS
[0012] FIG. 1 is a block diagram illustrating an example system for providing
combined life insurance accounts with self-directed investment accounts.
[0013] FIG. 2 is a swim-lane diagram illustrating example operations at a
direct
investment platform and a life insurance platform for initiating and
onboarding combined
life insurance accounts with self-directed investment accounts.
[0014] FIG. 3 is a flowchart of an example operation for associating and
presenting account information associated with a life insurance policy and an
associated
self-directed investment account.
[0015] FIG. 4 is a flowchart of an example operation for maintaining a life
insurance account and a separate, but related, self-directed investment
account.
[0016] FIG. 5 is a swim-lane diagram illustrating example operations for
managing and applying excess deposits into a life insurance policy described
in the
present application.
[0017] FIG. 6 is a swim-lane diagram illustrating example operations for usage
of
a margin account associated with and backed by the life insurance policy,
where the
account owner can invest or deaccumulate the margin account.
[0018] FIGs. 7-10 are example screenshots providing illustrations of various
web
interfaces incorporating information from both an investment platform and a
life
insurance platform in seamless combination.
DETAILED DESCRIPTION
[0019] Traditional universal life insurance options provide significantly
limited
investment options, if any. The present application describes a system wherein
customers
can associate a user-directed investment account with the universal life
insurance policy
(or other permanent life insurance products) to provide the benefits of
permanent
insurance and its increasing cash value with the independence provided by a
user-directed
investment account. In general, universal life insurance policies typically
gain value over
time based on the increasing investment portion of the customers' paid
premiums and, in
some cases, dividends or other funds. The value of universal life insurance
policies are in
their flexibility. Specifically, such accounts allow the customer, or policy
owner, to shift
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money between the insurance and savings components of the policy. Premiums,
which
may be variable, are separated by the insurance company into insurance costs
and
savings, thereby allowing the policy owner to make adjustments to their
premiums and
insurance coverage in response to their individual circumstances. For example,
if the
savings portion is earning a low return, that portion can be used instead of
external funds
to pay the premiums. Universal life can also allow the cash value of
investments to grow
at a variable rate that is adjusted monthly.
[0020] The self-directed insurance account (SDIA) described herein combines
the
tax-sheltering potential of life insurance with direct investment
capabilities. Today, forms
of permanent insurance such as universal life exist to defer and/or avoid some
income
tax, although none offer the insured full control over how assets are managed.
The SDIA
is a unique partnership between two distinct types of financial services,
online discount
brokers and life insurers. The creation of an insurance account on the direct
investment
platforms is unique in its benefits to consumers, as well as its technical
integration with
the life insurance account. To provide the described solution, new onboarding
and self-
service procedures are required, as the system removes the customary reliance
on the
traditional distribution, relationship, and servicing structure of the
financial services. For
example, as opposed to former accounts where changes to life insurance
investment
accounts were made through a life insurance advisors or associated brokers,
users can
now access and direct their self-directed investment accounts through the
functionality of
an investment platform capable of accessing and updating the investment
account
through continuous and on-going interaction with the life insurance policy.
The life
insurance platform can be accessed through the investment platform on a
continuous or
periodic basis to identify modifications to a margin account associated with
the life
insurance policy and to modify the funds available for borrowing against the
self-directed
insurance account. Additionally, through gains earned by the self-directed
insurance
account, customers are able to pay premiums associated with their life
insurance policy
and to further increase the cash value of the policy.
[0021] The SDIA further provides a unique borrowing mechanism allowing the
life insurance policy cash value to be used as collateral in order to increase
the available
credit margin on the associated SDIA. In some jurisdictions, the mechanism may
be used
CA 02910495 2015-10-28
to avoid tax dispositions on policy loans or withdrawals as well as an
effective way to
deaccumulate savings at retirement.
[0022] Traditional universal life policies may have significant inherent
limitations. For example, such policies may be limited in the investment
options
available and may include a limited number of mutual funds, guaranteed
investment
certificates or contracts (GICs), or limited currencies. Comparatively, the
SDIA allows
policy owners to also invest in corporate and governmental bonds, stock and
stock
derivatives (including options), preferred shares, bonds, money market
offerings,
commercial and other mortgage-backed securities, precious metal certificates,
real estate-
backed securities, exchange-traded funds (ERFs), real estate investment trusts
(REITs),
and US and Canadian dollars as well as other currencies. Traditional universal
life
policies may levy expense charges on assets as a percentage of assets held at
the end of
each month. The SDIA may not charge on assets (excluding fund management
expense
ratios (MERs)) and may only charge fees per transactions similar to lower cost
transaction brokerage accounts.
[0023] With regard to policy withdrawals, only a portion of the cash value may
be
available to traditional life insurance policies. For the SDIA, however,
assets held in the
insurance account can increase the margin limit available on the insurance
account for
investing and loans, thus eliminating any taxable disposition on policy loans
for some
jurisdictions. In some instances, traditional universal life policies charge
penalties on
withdrawals within the first 10 years of the policy. The SDIA avoids such
charges on
withdrawals, as the direct model removes compensation paid to brokers.
[0024] Another significant benefit of the SDIA is the real-time ability to
make and
modify investments. Traditional universal life policies are subject to
procedural delays,
including contacting an insurance advisor to update the policy, as well as any
actions to
be performed by the advisor/agent in enacting the requested changes.
[0025] With regard to the asset deaccumulation phase, policy owners of
traditional universal life policies who wish to obtain a loan against their
policy cash value
must work to try securing a loan from another financial institution. With the
SDIA, the
policy owner can borrow funds outside of the policy using the available
consolidated
margin account.
6
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CA 02910495 2015-10-28
. .
[0026] For traditional universal life policies, when the insured stops paying
premiums or the account value is exhausted, the policy will lapse. The SDIA
can provide
an option to use the margin account available to pay for insurance premiums in
order to
avoid lapses when premiums are not received from their normal funding source.
Alternatively, the SDIA can use gains from the insurance account to pay the
insurance
premiums, thereby avoiding out-of-pocket expenses.
[0027] FIG. 1 is a block diagram illustrating an example system 100 for
providing
combined life insurance accounts with self-directed investment accounts. As
illustrated
in FIG. 1, system 100 includes or is communicably coupled with a life
insurance platform
102, a direct investment platform 150, a network 140, and a client 180.
Although
components are shown individually, in some implementations, functionality of
two or
more components, systems, or servers may be provided by a single component,
system,
or server. Similarly, in some implementations the functionality of one
illustrated
component, system, or server may be provided by multiple components, systems,
servers,
or combinations thereof. Conversely, multiple components may be combined into
a
single component, system, or server, where appropriate.
[0028] As used in the present disclosure, the term "computer" is intended to
encompass any suitable processing device. For example, life insurance platform
102 and
direct investment platform 150 may each be any computer or processing device
such as,
for example, a blade server, general-purpose personal computer (PC), Mac ,
workstation, UNIX-based workstation, or any other suitable device. Moreover,
although
FIG. 1 illustrates a single life insurance platform 102, platform 102 can be
implemented
using two or more systems, as well as computers other than servers, including
a server
pool. Similarly, the direct investment platform 150 can be implemented as
multiple
systems or servers. In other words, the present disclosure contemplates
computers other
than general purpose computers, as well as computers without conventional
operating
systems. Further, illustrated client 180, life insurance platform 102, and
direct
investment platform 150 may be adapted to execute any operating system,
including
Linux, UNIX, Windows, Mac OS , JavaTM, AndroidTM, iOS or any other suitable
operating system. According to one implementation, the illustrated systems may
also
7
,
CA 02910495 2015-10-28
include or be communicably coupled with an e-mail server, a Web server, a
caching
server, a streaming data server, and/or other suitable server or computer.
[0029] In general, the life insurance platform 102 is used to maintain one or
more
life insurance policies for users. Each life insurance policy is associated
with a cash
value backed by a set of investment assets. The directed investment platform
150
maintains a user-directed insurance or investment account associated with at
least one of
the life insurance policies maintained by the life insurance platform 102. The
user-
directed account is funded based on a margin account determined based, at
least in part,
on the cash value of the corresponding life insurance policy and any other
cash or assets
invested in the margin account. The life insurance platform 102 functions to
receive
insurance premiums covering the cost of insurance plus a savings component.
[0030] The life insurance platform 102 and/or the direct investment platform
150
can determine a change or delta associated with the value of the investment
assets
backing the cash value of the life insurance policy. In response to the
detection, the life
insurance platform 102 and/or the direct investment platform 150 can modify
the allowed
value of the margin account by an amount proportional to the identified delta.
The
directed investment platform 150 can identify the modified value of the margin
account,
store the modified value, and update the user-directed investment account
based on the
modified margin account value. For example, the user-directed account can
allow the
account owner to purchase additional investments based on an increased margin
account
value.
[0031] The directed investment platform 150 may also be able to provide a web-
based interface for providing account owners with detailed information related
to their
account. In doing so, account owners with life insurance policies can view
account
information and details of the user-directed investment account. Additionally,
however,
the user-directed investment account can access the life insurance platform to
identify
account information related to the life insurance policy. The information can
then be
presented along with the account information for the user-directed investment
account via
the web-based interface.
[0032] The client 180 may be any computing device operable to connect to or
communicate with at least the life insurance platform 102 and/or the direct
investment
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platform 150 via network 140 using a wireline or wireless connection, and can
include a
desktop computer, a mobile device, a tablet, a server, or any other suitable
computer
device. In general, the client 180 comprises an electronic computer device
operable to
receive, transmit, process, and store any appropriate data associated with the
environment
100 of FIG. 1. Client 180 executes a client application 182 operable to access
one or
more of the life insurance platform 102 and the direct investment platform
150,
particularly for information related to life insurance and investment accounts
associated
with a user of the client 180. Client 180 can also include a graphical user
interface (GUI)
184. The GUI 184 interfaces with at least a portion of the environment 100 for
any
suitable purpose, including generating a visual representation of a Web
browser and/or
the client application 182. In particular, the GUI 184 may be used to view and
navigate
various Web pages located both internally and externally to environment 100,
as well as
to view and navigate through information accessed by the client application
182, such as
information stored at or associated with one or both of the life insurance
platform 102
and/or the direct investment platform 150. Generally, the GUI 184 provides the
particular user with an efficient and user-friendly presentation of data
provided by or
communicated within the system. The GUI 184 may comprise a plurality of
customizable frames or views having interactive fields, pull-down lists, and
buttons
operated by the user. For example, the GUI 184 may provide interactive
elements that
allow a user to view or interact with accounts such as life insurance accounts
or SDIAs.
The GUI 184 may present information associated with the client application 182
for
viewing and interaction. In general, the GUI 184 is often configurable,
supports a
combination of tables and graphs (bar, line, pie, status dials, etc.), and is
able to build
real-time portals, where tabs are delineated by key characteristics (e.g.,
site or micro-
site). Therefore, the GUI 184 contemplates any suitable graphical user
interface, such as
a combination of a generic web browser, intelligent engine, and command line
interface
(CLI) that processes information in the platform and efficiently presents the
results to the
user visually.
[0033] The illustrated client 180 is intended to encompass any computing
device
such as a desktop computer, laptop/notebook computer, wireless data port,
smart phone,
personal data assistant (PDA), tablet computing device, one or more processors
within
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these devices, or any other suitable processing device. For example, the
client 180 may
comprise a computer that includes an input device, such as a keypad, touch
screen, or
other device that can accept user information, and an output device that
conveys
information associated with the operation of the client application 182 or the
client 180
itself, including digital data, visual information, or a GUI 184, as shown
with respect to
the client 180.
[0034] Network 140 facilitates wireless or wireline communications between the
components of the environment 100 (i.e., between the client 180 and the life
insurance
platform 102 and/or the direct investment platform 150, as well as between the
life
insurance platform 102 and the direct investment platform 150), as well as
with any other
local or remote computer, such as additional clients, servers, or other
devices
communicably coupled to network 140, including those not illustrated in FIG.
1. In the
illustrated environment, the network 140 is depicted as a single network, but
may be
comprised of more than one network without departing from the scope of this
disclosure,
so long as at least a portion of the network 140 may facilitate communications
between
senders and recipients. In some instances, one or more of the illustrated
components may
be included within network 140 as one or more cloud-based services or
operations. The
network 140 may be all or a portion of an enterprise or secured network, while
in another
instance, at least a portion of the network 140 may represent a connection to
the Internet.
In some instances, a portion of the network 140 may be a virtual private
network (VPN).
Further, all or a portion of the network 140 can comprise either a wireline or
wireless
link. Example wireless links may include 802.11a/b/g/n, 802.20, WiMax, LTE,
and/or
any other appropriate wireless link. In other words, the network 140
encompasses any
internal or external network, networks, sub-network, or combination thereof
operable to
facilitate communications between various computing components inside and
outside the
illustrated environment 100. The network 140 may communicate, for example,
Internet
Protocol (IP) packets, Frame Relay frames, Asynchronous Transfer Mode (ATM)
cells,
voice, video, data, and other suitable information between network addresses.
The
network 140 may also include one or more local area networks (LANs), radio
access
networks (RANs), metropolitan area networks (MANs), wide area networks (WANs),
all
CA 02910495 2015-10-28
or a portion of the Internet, and/or any other communication system or systems
at one or
more locations.
[0035] The life insurance platform 102 represents a computer system, including
one or more servers, computers, processors, and other components, that
supports and
maintains the issuance and maintenance of life insurance policies,
particularly those
associated with a corresponding SDIA as described above. The life insurance
platform
102 includes an interface 104, a processor 106, a life insurance online
management
module 108, memory 122, a presentation module 130, and an insurance approval
review
system 134. In general, the life insurance platform 102 is a simplified
representation of
one or more systems and/or servers that provide and maintain life insurance
policies, and
is not meant to be limiting, but rather an example of the systems possible.
Additional
components may be included in or associated with the life insurance platform
102,
including policy administration, claims administration, billing, and others,
as needed.
[0036] As used in the present disclosure, the term "computer" is intended to
encompass any suitable processing device. For example, although FIG. 1
illustrates a
single life insurance platform 102, environment 100 can be implemented using
two or
more systems, as well as computers other than servers, including a server
pool. In fact,
life insurance platform 150 may be any computer or processing device such as,
for
example, a blade server, general-purpose personal computer (PC), Mac ,
workstation,
UNIX-based workstation, or any other suitable device. Similarly, the direct
investment
platform 150 can be implemented as multiple systems or servers. In other
words, the
present disclosure contemplates computers other than general purpose
computers, as well
as computers without conventional operating systems. Further, illustrated
client 180, life
insurance platform 102, and direct investment platform 150 may be adapted to
execute
any operating system, including Linux, UNIX, Windows, Mac OS , JavaTM,
AndroidTM,
i0S, or any other suitable operating system. According to one implementation,
the
illustrated systems may also include or be communicably coupled with an e-mail
server, a
Web server, a caching server, a streaming data server, and/or other suitable
server or
computer.
[0037] Regardless of the particular implementation, "software" includes
computer-readable instructions, firmware, wired and/or programmed hardware, or
any
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combination thereof on a tangible medium (transitory or non-transitory, as
appropriate)
operable when executed to perform at least the processes and operations
described herein.
In fact, each software component may be fully or partially written or
described in any
appropriate computer language including C, C++, JavaScript, JavaTM, Visual
Basic,
assembler, Pen , any suitable version of 4GL, as well as others.
[0038] The interface 104 is used by the life insurance platform 102 for
communicating with other systems in a distributed environment ¨ including
within the
environment 100 ¨ connected to the network 140, e.g.õ the direct investment
platform
150, client 180, and other systems communicably coupled to the network 140.
Generally,
the interface 104 comprises logic encoded in software and/or hardware in a
suitable
combination and operable to communicate with the network 140. More
specifically, the
interface 104 may comprise software supporting one or more communication
protocols
associated with communications such that the network 140 or interface's
hardware is
operable to communicate physical signals within and outside of the illustrated
environment 100.
[0039] As illustrated in FIG. 1, the life insurance platform 102 includes a
processor 106. Although illustrated as a single processor 106 in FIG. 1, two
or more
processors may be used according to particular needs, desires, or particular
implementations of the environment 100. Each processor 106 may be a central
processing unit (CPU), an application specific integrated circuit (ASIC), a
field-
programmable gate array (FPGA), or another suitable component. Generally, the
processor 106 executes instructions and manipulates data to perform the
operations of the
life insurance platform 102. Specifically, the processor 106 executes the
algorithms and
operations described in the illustrated figures, including the operations
performing the
functionality associated with the life insurance platform 102 generally, as
well as the
various software modules (e.g., the life insurance online management module
108, the
presentation module 130, and others), including the functionality for sending
and
receiving communications and transmissions to and from the direct investment
platform
150.
[0040] The illustrated life insurance platform 102 also includes memory 122,
or
multiple memories 122. The memory 122 may include any memory or database
module
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and may take the form of volatile or non-volatile memory including, without
limitation,
magnetic media, optical media, random access memory (RAM), read-only memory
(ROM), removable media, or any other suitable local or remote memory
component. The
memory 122 may store various objects or data, including financial data,
administrative
settings, passwords information, caches, applications, backup data,
repositories storing
business and/or dynamic information, and any other appropriate information
including
any parameters, variables, algorithms, instructions, rules, constraints, or
references
thereto associated with the purposes of the life insurance platform 102.
Additionally, the
memory 122 may store any other appropriate data, such as VPN applications,
firmware
logs and policies, firewall policies, a security or access log, print or other
reporting files,
as well as others. For example, memory 122 can store electronic life insurance
account
information 124 associated with one or more life insurance policies,
including, where
appropriate, margin account information 126. In some instances, the margin
account
information 126 may be specific information about one or more margin accounts,
as well
as parameters associated with a percentage of the cash value for which loans
and margin
accounts will be calculated. In some instances, margin accounts may be
authorized to a
particular percentage of the cash value of the investment assets of the life
insurance
policy. In others, the particular percentage may be an initial margin value,
with
individual information taken into account to determine the appropriate amount
for the
margin value account. The life insurance account information 124 can store
information
on life insurance policies for a plurality of policy owners and can provided
varying
margin account percentages and calculations, which can vary based on each
policy
owner's individual financial information. Memory 122 further includes a set of
administrative and lending settings 128 that can provide rules and settings
related to new
life insurance policies being issued, rules defining the decisions used to
determine the
size of a margin account for various policy owners, and other settings related
to the life
insurance platform 102. In some instances, the administrative and lending
settings 128
may include password and login information to the life insurance platform 102,
among
other settings.
[0041] The life insurance online management module 108 represents an
application, set of applications, software, or a combination of software and
hardware used
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CA 02910495 2015-10-28
to manage the online interactions of the life insurance platform 102. In the
present
solution, the life insurance online management module 108 can perform
operations
including onboarding policy holders (e.g., providing life insurance
applications to users,
receiving application information, approving or managing the approval of life
insurance
applications), determining margin account values or ratios, providing
information to or
retrieving information from the direct investment platform, and assisting in
the
deaccumulation of assets from the life insurance policy, among others.
Specifically, the
life insurance online management module 108 can transform data associated with
the life
insurance account based on information received from policy holders, the
direct
investment platform 150, and other automated systems. Upon transferring the
data, the
life insurance online management module 108 can store the updated information
for
future use, including for updating the margin account calculation. The life
insurance
online management module 108 can include various functionality to assist in
the
management and maintenance of the life insurance policies. As illustrated in
FIG. 1, the
life insurance online management module 108 includes an onboarding module 110,
a life
insurance management module 112, a margin account module 114, a linking module
118,
and a loan and deaccumulation module 120. Additional modules and functionality
may
be included in alternative implementations.
[0042] The onboarding module 110 manages the onboarding process of the life
insurance policy, including receiving information from a direct investment
platform 150.
Further descriptions of this process are provided by FIGs. 2 and 3. The life
insurance
management module 112 generally performs operations associated with the
ongoing
maintenance and management of particular life insurance policies, and may
include
premium payment and reminder functionality, periodic communications to policy
owners,
and other routine life insurance activities. In some instances, the life
insurance
management module 112 may coordinate or work with individuals associated with
the
insurer to perform maintenance on certain policies and accounts, provide
reminders to
agents of the insurer, identify issues and notifications for policy owners,
and other
assorted tasks. In some instances, the life insurance management module 112
may handle
payments of insurance premiums via automatic deductions from the SDIA, e.g.,
as
planned or when payment through an expected channel is not received on time.
14
CA 02910495 2015-10-28
[0043] The margin account module 114 can apply margin account rules stored in
the administrative and lending settings 128 to perform initial and ongoing
determinations
as to the values of the margin accounts associated with the various life
insurance policies.
In some instances, the margin account module 114 may act independently based
on
information received in the life insurance application and based on ongoing
information
identified during the life of a policy to determine the appropriate margin
account value
for an account. The margin account module 114 is illustrated as including an
account
analysis module 116 which can be used to identify additional information about
policy
holders to determine risk information, credit history information, health
information, and
other data relevant to the account and the margin value. In some instances,
users
associated with the insurer can input information into the life insurance
platform 102
which can be used by the margin account module 114 to perform the analysis.
[0044] The linking module for the direct investment system 118 is a component
used to share information with or retrieve information from the direct
investment
platform 150. The linking module 118 may represent at least one application
programming interface (API) accessible to the direct investment platform 150
where
information associated with the life insurance policy can be obtained.
Conversely, the
linking module 118 may be capable of accessing APIs located at the direct
investment
platform 150 to retrieve information associated with the corresponding SDIA of
an
account. In some instances, the linking module can identify credentials stored
in the life
insurance account information 124 that can be used to access the direct
investment
platform 150 via the linking module 158 in the direct investment platform 150.
Various
types of authentication and/or handshaking can be used to ensure privacy and
security,
including public/private key encryption, secure channels, and other techniques
and
solutions.
[0045] The loan and deaccumulation module 120 can be used to determine plans
and payments associated with the reduction of the cash value of a life
insurance policy
through periodic payments and reductions in cash value. For example, permanent
life
insurance can be used as a retirement or other savings vehicle, such that the
cash value
can be reduced to provide income and/or payments to the policy owner.
Additionally, the
loan and deaccumulation module 120 may also handle and support various policy
loan
CA 02910495 2015-10-28
requests, including determinations on amounts available to loan and repayment
schedules. The module 120 can manage repayment schedules
[0046] The life insurance platform 102 further includes a presentation module
130. The presentation module 130 can be used to generate web interfaces
related to the
life insurance policy, including providing the functionality for submitting
life insurance
applications, reviewing policy documents and information, and for managing
life
insurance information. While the investment account is located at the separate
and
distinct direct investment platform 150, the presentation module 130 can
access, via, e.g.,
the linking module 118, information about the investment account. The
information can
then be presented along with the life insurance information via the web-based
interface to
present a more complete illustration of the life insurance policy and
associated SDIA.
[0047] The life insurance platform 102 further includes an insurance approval
review system 134. The insurance approval review system 134 can assist in the
initial
determination of whether a life insurance application will be approved,
approved with
limitations, or rejected. The insurance approval review system 134 may include
automated rules to determine whether the application is accepted, including
rules to
determine if additional medical and/or personal information may be necessary
prior to a
decision. The insurance approval review system 134 may be associated with one
or more
other systems, including by sending requests for an administrator or other
insurer agent to
perform a follow-up interview or analysis prior to issuing a policy.
[0048] The direct investment platform 150 represents a computer system,
including one or more servers, computers, processors, and other components,
that
supports and maintains the SDIAs associated with one or more life insurance
policies of
the life insurance platform 102. In some instances, the direct investment
platform 150
can also manage and maintain investment accounts unrelated to life insurance
policies as
well. The direct investment platform 150 can be maintained by a related
company to the
life insurer associated with the life insurance platform 102 or by an
associated third-party
administrator contracting with the life insurer to provide the associated
SDIA. As
illustrated, the direct investment platform 150 includes an interface 152, a
processor 154,
a direct investment online manager 156, a memory 164, and a presentation
module 170.
In general, the direct investment platform 150 is a simplified representation
of one or
16
CA 02910495 2015-10-28
more systems and/or servers that provide and maintain the self-directed
insurance
accounts, and is not meant to be limiting, but rather an example of the
systems possible.
[0049] Interface 152 and processor 154 may be similar to interface 104 and
processor 106, and memory 164 may be generally similar to memory 122. Memory
164,
as illustrated, includes information on one or more self-directed investment
accounts 166,
as well as administrative and investment settings 168. The self-directed
investment
account information 166 can include information defining the particular
investments
bought for a specific account, the current values (realized and non-realized),
the margin
value of the account, and other information relevant to the SDIA. The settings
168 can
include information on how such accounts are managed, rules for auto-
rebalancing
individual accounts, user preferences, investment timing information, and
other setting
and administrative information. The self-directed investment account
information 166
can include unique identifiers identifying the account, which may match
identifiers also
associated with the life insurance account information. The correlations
between the
unique identifiers of the pair of accounts can allow quick commingling of
information for
web interfaces prepared and provided by presentation module 170 (or 130).
[0050] The direct investment online manager 156 performs the operations
associated with managing and maintaining the SDIAs. As illustrated, the direct
investment online manager 156 includes a linking module to the life insurance
system
158 and a self-directed investment manager 160. The direct investment online
manager
156 can electronically access data stored at the life insurance platform 102,
store the data
at the direct investment platform 150, and transform the data used to present
account-
related information. The linking module 158, similar to the linking module
118, allows
the direct investment online manager 156 to access information related to the
life
insurance policy and use that information in managing the self-directed
insurance
account. For example, the direct investment online manager 156 may access
information
on the policy amount, current cash value, margin account value, and other
information
from the life insurance account information 124. The self-directed investment
manager
160 performs the specific management of the investment account and can provide
tools to
policy owners for buying, selling, and otherwise managing their insurance
accounts. The
margin account manager 162 can interact with the margin account module 114 of
the life
17
CA 02910495 2015-10-28
insurance platform 102 to identify the current margin account value for a SDIA
and allow
the user to invest up to the maximum value in the margin account, if so
desired. The self-
directed investment manager 160 and the margin account manager 162 can use the
linking module 158 to access relevant information from the life insurance
policy for use
in investment and account determinations. To that end, the direct investment
platform
150 includes a presentation module 170. The presentation module 170 can
prepare and
present information associated with the SDIA to users, such as users using the
client
application 182 at client 180. The presentation module 170, using the linking
module
158, can access the life insurance platform 102, identify relevant information
to be
presented from the life insurance account information 124, and can include
that
information in the presentation to the account owner along with information
specific to
the SDIA. This presentation can allow policy owners to manage their life
insurance
policy and the associated SDIA through one web interface, greatly simplifying
the
process previously used to manage their accounts while also providing
significant
flexibility in investing funds associated with the insurance accounts.
[0051] The system may also be able to identify any assets held under any of
the
user-directed investment accounts associated with the account holder for the
purposes of
allowing the account holder to collateralize option derivatives in the SDIA
account that
are written on assets held in other user-directed investment accounts. Still
further, the
system may be able to identify any assets held in any of the user-directed
investment
accounts to facilitate margin calculations for the purposes of trading within
the SDIA.
For example, the margin may be increased based on any assets held in any of
the user-
directed investment accounts, not only the SDIA.
[0052] While portions of the software illustrated in FIG. 1 are shown as
individual
modules that implement the various features and functionality through various
objects,
methods, or other processes, the software may instead include a number of sub-
modules,
third-party services, components, libraries, and such, as appropriate.
Conversely, the
features and functionality of various components can be combined into single
components as appropriate.
[0053] FIG. 2 is a swim-lane diagram 200 illustrating example operations at a
direct investment platform 205 and a life insurance platform 210 for
initiating and
18
CA 02910495 2015-10-28
onboarding combined life insurance accounts with self-directed investment
accounts.
The direct investing platform 205 may be similar to or different from the
direct
investment platform 150, while the life insurance platform 210 may be similar
to or
different from the life insurance platform 102 of FIG. 1.
[0054] In many cases, customers of a direct investment platform 205, such as
those who already have an account managed by the direct investment platform
205, may
be excellent candidates for life insurance coverage. At 220, an existing
investment client
can receive a promotion related to a particular life insurance product as
described in the
present text. Using a link included in the promotion (e.g., via a marketing
email or a pop-
up box in a web-based interface), or by navigating to the life insurance
platform, the
investment client can request a quote via the life insurance platform, such as
by
completing a personal information and health questionnaire representing the
insurance
application, at 225. When at the site, the potential life insurance customer
can calculate
their needs for insurance while estimating the insurance premiums and
contribution levels
needed to meet those needs. Various account scenarios and projections may be
calculated
by the life insurance platform 210 to illustrate potential savings and cash
values, as well
as potential tax savings information.
[0055] Once the life insurance application is submitted, the life insurance
platform 210 and the life insurer can assess, at 230,the risk and determine
the appropriate
rates to offer, if any, the applied-for life insurance policy. In some cases,
the insurer may
decide that additional medical testing or information may be needed to perform
a full risk
analysis. In some implementations, an automated decision tool may be used to
determine
whether to offer the life policy and at what rates based on the information
received from
the application.
[0056] At 235, a life insurance policy is issued at the determined rates and
for an
initial amount. When issuing the policy, the life insurance policy is assigned
and/or
associated with a unique customer identifier (ID). At 240, the life insurance
platform 210
notifies the direct investment platform 205 of the new life insurance policy.
At 245, the
direct investment platform 205 can initiate and provide access to a self-
directed insurance
account. The self-directed insurance account can be assigned to or associated
with the
same unique customer ID as the life insurance policy at the life insurance
platform 210.
19
CA 02910495 2015-10-28
In some instances, the customer IDs may not be identical, but instead can be
complementary or otherwise associated with one another to allow for
correlation between
the accounts. Once the SDIA is set up, the account tools provided by the
direct
investment platform 205 can be used to manage the SDIA similar to other
investment
accounts. As noted above, the amount available to invest in the SDIA may be
directed
related to the margin account approved for the policy owner based on a
suitable rule set
or determination. In one instance, the direct investment platform 205 can
provide
information related to the current contribution levels made to the life
insurance policy at
the life insurance account, and can provide feedback and projections related
to alternative
payments and additional premiums paid. By allowing the policy and account
owner to
actively review their deposits and manage investments, significant advantages
can be
realized, including a real-time adjustment of the insurance account,
personalized
projections, and manual management of the account and policy. As information
related
to the life insurance policy is presented at the direct investment platform
205, constant
updates of the relevant information can be performed to ensure only up-to-date
information is presented to the account owner. While the accounts are managed
by two
different systems, the operations of the system allow for seamless
presentation of
information from both accounts such that users may be unaware that the
information is
being managed by the different systems. In some instances, when the account
owner
requests a projection at the direct investment platform related to the life
insurance
account, the life insurance platform 210 may be performing the calculations
and sharing
the results to the direct investment platform 205.
[0057] As illustrated, at 250, an agent of the life insurer (or alternatively,
of the
direct investment platform 205) may initiate a phone call following up on the
new life
insurance policy (or the new SDIA). The follow-up call can allow the life
insurance
agent to provide further assistance in setting up the insurance account, as
needed, and to
instruct the policy owner on any matters of interest.
[0058] FIG. 3 is a flowchart of an example method 300 for presenting a unified
set of account information from a life insurance account and a separate, but
related, self-
directed investment account. For clarity of presentation, the description that
follows
generally describes method 300 in the context of the system 100 illustrated in
FIG. 1.
CA 02910495 2015-10-28
However, it will be understood that method 300 may be performed, for example,
by any
other suitable system, environment, software, and hardware, or a combination
of systems,
environments, software, and hardware as appropriate.
[0059] At 305, login information is received from a user of a direct
investment
platform. The login information allows the direct investment platform to
authorize the
user and prepare a presentation of information related to the user's account.
The login
information may be associated with a unique customer ID. In some instances,
the
customer ID may be a part of the user's login information (e.g., a user name),
while in
other instances the unique customer ID may be linked to the user's login
credentials.
[0060] At 310, one or more direct investment accounts associated with the
customer ID are identified. These direct investment accounts can include
traditional
investment accounts, retirement accounts, and, for the purposes of this
application, at
least one self-directed insurance account.
[0061] At 315, life insurance account information associated with the customer
ID
is accessed from a life insurance platform. In some instances, the direct
investment
platform can query the life insurance platform to retrieve the information,
while in others,
the direct investment platform can directly access the life insurance
platform, such as via
predefined APIs providing access, with authorization, to the life insurance
platform and
information associated with particular accounts. Further, the insurance
account
information may be provided to the direct investment platform from the life
insurance
platform using data extracts on a periodic basic, such as monthly.
[0062] At 320, the identified direct investment accounts and the life
insurance
account information associated with the customer ID obtained from the life
insurance
platform are integrated into a combined record set for presentation. The
information
from the life insurance platform can be seamlessly integrated into the
information
associated with the direct investment accounts associated with the login
information.
FIGS. 7-10 provide examples of the integration of information from different
systems.
[0063] At 325, the combined information is presented via a web interface for
viewing and interaction within the direct investment platform. In many
instances, the
information is interactive and can be modified by the user. For interactions
with the life
insurance account information, requests can be received via the web interface,
21
CA 02910495 2015-10-28
transmitted to the life insurance account, and updated information returned to
the direct
investment platform for viewing.
[0064] While method 300 assumes that login information is received at a direct
investment platform, alternative implementations may allow the information to
be
presented via a web interface associated with the life insurance platform,
with
information related to the investment accounts being obtained from the direct
investment
platform and presented via the life insurance platform's web interface.
[0065] FIG. 4 is a flowchart of an example operations (400) for maintaining a
life
insurance account and a separate, but related, self-directed investment
account.
Operations 405 and 410 can occur concurrently after initiating and onboarding
the life
insurance policy and associated self-directed (or user-directed) investment
account.
[0066] At 405, a life insurance policy and account are maintained at a life
insurance platform, where the life insurance policy is associated with a cash
value.
Concurrently, at 410, a user-directed insurance account associated with the
life insurance
policy is maintained at a direct investment platform, where the user-directed
account is
funded with a margin account directly associated with the cash value of the
life insurance
policy. The margin account represents a pre-determined percentage of the cash
value of
the life insurance policy and can be used to fund the user-directed insurance
account.
[0067] At 415, a determination is made as to whether a change to the cash
value
of the life insurance policy has occurred. If not, the operations return to
405. If a change
has occurred, such as additional premiums combining the cost of insurance and
an
additional amount for savings, the cash value of the life insurance policy
will increase.
As a result of the change, the life insurance platform can automatically
modify the funds
available to a margin account associated with the cash value of the life
insurance policy at
420. The life insurance platform can then notify the direct investment
platform of the
change in the margin account. Alternatively, the direct investment platform
may watch or
identify the change itself, such that no notification is required.
[0068] At 425, the user-directed insurance account is updated based on the
modified margin account. In some instances, the update may result in an
automatic
investment by the direct investment platform as defined by the account owner.
Alternatively, the account owner may be notified or become otherwise aware of
the
22
CA 02910495 2015-10-28
additional available funds and can direct the investment of those funds at a
later time. At
430, updates to the user-directed investments are identified, and at 435, the
identified
investments are made and the user-directed insurance account is updated
accordingly.
[0069] FIG. 5 is a swim-lane diagram illustrating example operations for
managing excess deposits into a life insurance policy described in the present
application.
Specifically, the new insurance investment accounts described herein allow
customers
504 (or policy owners) to choose how to apply excess deposits above the
insurance
minimum. The customer 504 can elect (at 510) to apply the excess deposits via
either the
life insurance platform 506 (via phone call to the life insurer's live
support) or through
the web interface provided by the direct investment platform 502.
[0070] Should the user elect to perform the application through the live
support of
the life insurance platform 506, the user can phone a live agent (530). The
live agent can
provide information and assist with the additional investment. At 534, the
live agent can
use online tools to explore contribution scenarios for the policy owner and
can manage
the transfer or deposit and allocation of funds to particular investments
selected by the
policy owner at 538.
[0071] If the user elects to perform the investments himself, he can log into
the
web interface at 514. At 518, the user can use the online tools to explore
contribution
scenarios and/or investment options. Based on this research, the customer 504
can then
transfer or deposit the allocated funds into the investments via the self-
directed insurance
account (522).
[0072] FIG. 6 is a swim-lane diagram illustrating example operations (600) for
usage of a margin account associated with and backed by the life insurance
policy, where
the account owner can invest or deaccumulate the margin account.
[0073] Prior to using a margin account, customers 602 (policy owners) must
apply for and be authorized for using self-directed insurance accounts as
collateral for a
margin account (620). Upon doing so, and upon approval, the direct investment
platform
606 managing the insurance account can receive a deposit (624). The deposit,
as
described previously, can be based on a margin value associated with the cash
value of
the insurance policy.
23
CA 02910495 2015-10-28
[0074] At 628, the direct investment platform 610 managing a larger margin
account (i.e., based on, for example, funds outside of the self-directed
insurance account)
can increase the existing margin by a predetermined value (e.g., a set
percentage or
calculation) of the cash value of the insurance policy. In fact, different
investments or
values may be margined at different rates. For example, cash may be margined
100%,
while securities may be margined at a different rate related to the particular
security. In
some instances, the margin account may be first created in response to opening
the life
insurance policy, in which there will be a new margin account generated and
new funds
deposited into the account. The amount of the increased margin available based
on the
cash value of the insurance policy can, as described above, be customized by
the direct
investment platform and/or the life insurance platform to represent an
acceptable level of
risk associated with the individual and the loan as compared to the cash value
of the
insurance policy.
[0075] At 632, the direct investment platform 610 determines whether the
current
margin account is to be used to generate income. The determination may be
based on the
policy and account holder's preferences and/or instructions. If no income is
to be
generated, then at 636, the policy and account holder can use the increased
margin for
additional investments using the direct investment platform. If income is
requested, then
at 640, the policy and account holder can receive periodic loans against the
available
margin to fund income payments. This can be considered a deaccumulation of the
margin account and allows policy owners to create cash without liquidating the
investment. In some instances, receiving loans via the margin account may
create fewer
taxable transactions than a liquidation of other investments, thereby
providing a savings
to the policy holder.
[0076] In some implementations, the direct investment platform may perform
additional checks to reduce the taxable impact of the SDIA. For example, the
direct
investment platform may monitor investments to ensure that such investments do
not
exceed tax sheltered maximum amounts permitted by law (i.e., without incurring
taxable
obligations). In those instances, investments over the maximum non-taxable
amount may
be transferred automatically to another, separate account. The direct
investment platform
can provide a notification mechanism such that the account holder makes the
final
24
i
CA 02910495 2015-10-28
decision over which assets are to be transferred. If the notification is not
answered, the
direct investment platform may move the funds based on pre-defined rules
and/or
instructions.
[0077] Additionally, the direct investment platform and associated advisors
may
provide account holders with monthly or periodic information related to the
investments,
including the maximum contribution levels available (e.g., without a taxable
obligation)
based on past investment results and the level of insurance coverage. The
direct
investment platform may also automate tax advice related to which assets
should or could
be transferred to the SDIA.
[0078] FIGS. 7-10 are example screenshots providing illustrations of various
web
interfaces incorporating information from both an investment platform and a
life
insurance platform in seamless combination.
[0079] FIG. 7 represents a welcome page 700 associated with a web interface
for
the direct investment platform. The welcome page 700 provides simple user
access to the
self-directed accounts and the insurance information directly from the welcome
screen to
the investment platform.
[0080] FIG. 8 represents an example of a "View Balances" page 800 presented
via
the web interface. As shown, information about the life insurance account is
seamlessly
included in the listing of other investments maintained at the direct
investment platform,
even in light of the life insurance policy being managed and maintained at a
separate and
distinct life insurance platform. Information related to the life insurance
account and
SDIA, in part from the SDIA maintained at the direct investment platform and
in part
from the life insurance policy at the life insurance platform, is presented in
a single page.
Interactions, such as "Refresh Insurance Assumptions", may be available that
can trigger
actions at the life insurance platform via the web interface for the direct
investment
platform. As illustrated here, the button may be associated with a SDIA tools
page, such
as shown in FIG. 10.
[0081] FIG. 9 represents a screen 900 wherein the account holder can identify,
buy, and sell various investments for the SDIA through the web interface of
the direct
investment platform. Such a page may be similar to those previously available
at the
direct investment platform, but which instead are associated with the SDIA.
i
CA 02910495 2015-10-28
[0082] FIG. 10 represents a new screen 1000 available at the web interface of
the
direct investment platform wherein the policy owner can access tools to manage
the
SDIA. As illustrated, tools may be available to modify and view various
calculations
associated with the SDIA, including the rate of return assumptions and tax
impact
assumptions. Additionally, tools may be available to assist the policy and
account holder
in maximizing contributions within a non-taxable range, as well as how to
modify
insurance coverage to allow tax-minimized increases to contributions.
Further,
retirement deaccumulation may be managed through the screen 1000, as well as
projections related to contribution assumptions. Various additional and
alternative tools
and functionality may be available in other implementations.
[0083] The preceding figures and accompanying description illustrate example
systems, processes, and computer-implementable techniques. While the
illustrated
systems and processes contemplate using, implementing, or executing any
suitable
technique for performing these and other tasks, it will be understood that
these systems
and processes are for illustration purposes only and that the described or
similar
techniques may be performed at any appropriate time, including concurrently,
individually, or in combination, or performed by alternative components or
systems. In
addition, many of the operations in these processes may take place
simultaneously,
concurrently, and/or in different orders than as shown. Moreover, the
illustrated systems
may use processes with additional operations, fewer operations, and/or
different
operations, so long as the methods remain appropriate.
[0084] In other words, although this disclosure has been described in terms of
certain embodiments and generally associated methods, alterations and
permutations of
these embodiments and methods will be apparent to those skilled in the art.
Accordingly,
the above description of example embodiments does not define or constrain this
disclosure. Other changes, substitutions, and alterations are also possible
without
departing from the spirit and scope of this disclosure.
= 26
