BOUGHT AND SOLD - Allmerica Financial has reached an agreement to sell its group life and health insurance business to Great-West Life & Annuity. Allmerica President and CEO John O'Brien said the sale will "enable us to concentrate our focus on the profitable growth of our two core businesses - asset accumulation and property and casualty insurance." Pacific Mutual has acquired M.L. Stern, a Beverly Hills broker-dealer and its affiliate, investment adviser Tower Asset Management. Pac Life's broker-dealers now include Pacific Mutual Distributors, Mutual Service Corp., United Planners' Financial Services, Associated Services Corp., and Titan/Value Equities. Finally, HCC Holding announced it will buy rival Centris Group for $171 million and merge the operations.

SURVEY SHOWS - According to a study by the Association of Banks in Insurance, banks increased their sales of traditional insurance products (excluding annuities and credit life) by 35% in 1998. Bank sales of all types of insurance products achieved a 12% increase, to $31.1 billion last year. Of the banks surveyed, 20% will begin to offer long-term care insurance and 22% will add P&C to their portfolios within the next two years.

AGREEMENT ELUSIVE - Medical privacy issues continue to delay passage of financial services reform legislation. The concern is how to ensure that private medical records held by insurers are not divulged to bankers or stock brokers in the same company.

SCARY SCENARIO - Many analysts see a scary situation developing across the country today, with many investors spending more than they earn. As Investment News points out, it wouldn't be so bad if they "financed the spending by selling winners, locking in the gains." But that's not what's happening. Instead, most are using credit cards to finance their spending, counting on a continuing bull market to bail them out eventually. When the market corrects, as it ultimately will, many of these people will learn the hard way not to rely on market gains to pay off large amounts of debt down the road.

EUROPEAN INSURER GROWTH STRATEGIES - LOMA has produced a report that examines the growth strategies of eight multinational insurance groups that are among the largest life and health insurers in the U.S. today - AXA, ING, Allianz, Prudential (UK), Zurich, Fortis, Aegon and Skandia. The report "reveals the strategies behind their success." For more information on the report ("Eight European Insurance Conglomerates With U.S. Operations: A Study in Consolidation"), visit the LOMA Web site at http://www.loma.org.

HIGHER BANK FAILURE LOSSES - The FDIC says that this year's bank failures are expected to generate the biggest losses (an estimated $760 million in insured losses) since the banking crisis of the early 1990s. Regulators are warning banks to tighten their lending standards, particularly in relation to "high loan-to-value residential loans" that allow consumers to borrow as much as 125% of their home's value.

BIG SURPRISE - Nearly one in three House Republicans broke from their leadership and joined with Democrats to approve a wide-reaching patient protection bill. The House bill is, however, "miles apart" from Senate legislation passed earlier in the year, particularly on the right-to-sue issue. The bills now head to a conference committee, where business and insurance groups are counting on Senate Republicans to hold the line on this controversial issue.

TICKING TIME BOMB - Despite a booming economy, the number of Americans without health insurance climbed to 44.3 million in 1998, or 16.3% of the population. Meanwhile, the number of people covered by Medicaid fell by more than one million, probably the result of federal welfare reforms.

NO ASSOCIATE CFP - It's official.the CFP Board of Governors rescinded its controversial initiative to create a new, entry-level designation.

VARIABLE LIFE GROWTH CONTINUES - Tillinghast reports that the second quarter saw a 17% increase in variable life sales. Further, the top five variable life companies (Equitable.now AXA, Prudential, IDS, Western Reserve and New England) sold 30% of all variable sales. While 60% of variable life sales were from career agents, 50% of the single premium variable life sales have come from independent broker-dealer firms in 1999.

TOP TEN - Quotesmith released the top ten term life companies requested through its price comparison service in September. They are:

	1. First Colony Life	6. West Coast Life
	2. John Hancock	7. Transamerica Occidental
	3. Banner Life	8. American Mayflower of NY
	4. Midland Life	9. Protective Life
	5. First Penn-Pacific Life	10. Valley Forge Life

VIATICAL HELP - Coventry Financial, the nation's leading originator of lifetime settlements, has opened its new Web site at http://www.coventryfinancial.com. The site provides access to educational pieces, case studies, application forms, as well as the ability to inquire about a potential case. The 'Members Only' section provides marketing pieces, licensing information, and legal and tax opinions. Soon its producers will have real-time status of their cases via the Internet.

AGENT STILL THE KING - Most home office executives do not believe the Internet, or other technology, will replace live agents when it comes to selling life insurance, according to the CEOs of Northwestern Mutual and Aegon. They did caution agents, however, not to view life insurance as a commodity, or they risk diminishing the value of the product, harming policyholders and themselves.

FISCAL FITNESS - That's the name of a program sponsored by Phoenix Home Life that surveys Americans on their financial attitudes. The 1999 "echo boomer" survey (students ages 12 to 21) reveals an overall optimism, with 50% expecting to be wealthier then their parents (but only 15% expect to have to work harder then their parents!). While the Internet is seen as an important source of financial information in the future, only 20% responded that they feel "very good" at managing money…very consistent with their parents' response. For complete survey results of both echo boomers and their baby boomer parents, visit the Phoenix Home Life site (http://www.phl.com/fiscal/index.htm).

BETTER APPROACH TO LTC? - We've always felt that tying LTC benefits to an individual reserve was superior to the pooled concept used by most carriers…it substantially reduces the potential of adverse selection. Golden Rule pioneered the concept and now several companies are offering similar products. Nationwide announced that it will launch a variable annuity with long-term care benefits. The product requires a single premium and combines a deferred variable annuity with long-term care insurance. John Hancock will offer an LTC rider that costs 10 basis points on their new variable annuities. Interstate Assurance and Irish Life are offering a universal life policy with an accelerated benefit rider that prepays the death benefit if the insured needs long-term care.

SUCCESS STORY - Virtual Sales Assistant subscriber Bryan Richardson reports significant sales by using the VSA key person, DI and estate planning presentations…total commissions of about $15,000. He also tells us that his wife, who is an attorney, thinks the site is "neat." Use LUTC's offer of the first 30 days free to see if the VSA will do the same for you -- http://www.lutc.com.

WAIT AND SEE - That's about all we can do in regard to tax legislation. The House has passed a $23.3 billion bill that renews many expiring business tax credits for five years and permanently fixes the AMT problem faced by middle-income families. The Senate is moving toward passage of only one-year extensions at a cost of about $7.8 billion. The two bills would then have to be reconciled in conference. The House has also approved a package of health-care tax breaks that includes a new tax deduction for workers without insurance at their jobs, 100% health insurance premium deductibility for the self-employed beginning in 2001, full deductibility for LTC premiums and an extension of medical savings accounts. At this point, the future of this legislation is very uncertain.

CHUTZPAH TRUSTS - Congress attempted to outlaw accelerated charitable remainder trusts in the 1997 Taxpayer Relief Act. Investment News reports that the IRS is now investigating a "son of accelerated charitable remainder trusts," also known as "chutzpah" trusts, a name based on "its brazen approach to tax avoidance." According to the article, it is believed that these trusts are "marketed mainly by the nation's biggest accounting firms" and the "money being sheltered in them is substantial."

EXPENSE? - Why can't a corporation deduct life insurance premiums? According to the late insurance legend, Ben Feldman, it's "because they're not spending the money." Most people view life insurance as an expense, but according to Ben and Howard Wight, it needs to be explained to them that they are creating a contingent asset. They are merely moving money from one bank to another kind of bank. Worst case…assuming they keep paying…is that they or their family or business will get back whatever was paid in plus a lot more.

SLOW GROWTH - While more Americans are trying Medical Savings Accounts (MSAs), the growth is slow. According to the IRS, 42,477 taxpayers reported MSA contributions in 1998, up from 41,668 in 1997. Through June of this year, 11,727 new MSAs were opened. MSAs are currently limited to the self-employed and to companies with 50 or fewer workers. A Republican proposal to open MSAs to all Americans as part of a package of health care tax breaks is pending.

SALLIE MAE TO SELL INSURANCE - Sallie Mae has made an alliance with Answer Financial, an insurance marketer representing 85 carriers, to offer insurance to its five million student loan customers. Sallie Mae hopes to enrich its relationship with customers (and itself!) by offering them life insurance, P&C insurance, annuities and other products. Customers can visit Answer Financial (http://www.answercenter.com) to purchase the products. We're not sure that this should be the domain of a "quasi-government" organization.

DECISION MONTH - November is Medicare's "annual election period," during which Medicare beneficiaries may elect to leave the fee-for-service Medicare and join an HMO. The Health Care Financing Administration recently mailed a handbook, "Medicare & You 2000," to all Medicare beneficiaries. The handbook is a good source of Medicare information, as is the Medicare Web site (http://www.medicare.gov), which also contains quality and satisfaction information on managed care plans and nursing homes.

PROVE YOURSELF FIRST - In Life Insurance Selling, agent J. B. Griffith reminds agents to prove themselves by providing service and establishing a relationship before asking for referrals. We suggest, once again, that in addition to providing service to set the stage, you also provide specific names. It's easy with the Virtual Sales Assistant's Referred Lead Generator. Check it out and get the first 30 days free at http://www.lutc.com.

THE DARK SIDE - Jury selection has begun in Charleston, SC for one of three parents charged in a deadly 1997 fire. The three are accused of setting fire to their home and killing their five children to claim insurance money. Prosecutors will seek the death penalty. Then we have a Brazilian businessman facing criminal charges after confessing he hired a friend to chop his arm off to collect insurance of more than $465,000. The man admitted he paid $165 to his friend, who agreed to chop his left arm off with an ax. Finally we have the bozo in California who was arrested in a plan to sink his million-dollar yacht near the Golden Gate Bridge in order to collect the insurance money. He made a slight mistake, however, when he hired undercover insurance investigators to do the job and was arrested when he showed up at the police department to fill out a report for his insurance company.