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Beyond Life Insurance with Ray Caucci

Episode 76:

The insurance industry is pretty confusing for most of us. We send our money into what feels like a black box and things magically happen…or don’t. Our guest for this episode, Ray Caucci, is here to demystify the insurance business to paint a broader picture of its stability, the impact on the health of our economy, and why it matters to your finances.

Ray has been in the insurance industry for his entire adult life. He has spent the better part of twenty years on the actuarial side in product development with Penn Mutual, and he now serves on the executive management team. As an actuarial mathematician and business leader, Ray keeps his finger on the pulse of industry trends. He brings tons of value to our listeners with unique insights into the mechanics of war-room decision-making in the insurance industry. He also shares his perspective on the versatility of whole life insurance policies.

Ray graduated from UPenn’s Wharton School of Business with a Master’s in Actuarial Science, along with a Chartered Financial Consultant (ChFC) designation from The American College of Financial Services. During our conversation, he shares his expertise and provides a perspective on the role of insurance in the bigger picture.

What You Will Learn in This Episode:

  • The power of assigning value to your giftings
  • All of the ways you can use a whole life insurance policy to your benefit
  • The role and function of an actuary in the insurance industry
  • How actuaries approach product development and pricing
  • The types of statistics, data, and algorithms insurance companies use to find the best bang for the buck and a product fit for all parties involved
  • What insurance companies have done to adapt during the pandemic
  • Penn’s perspective on the different insurance policy types
  • The role insurance plays in our entire financial system
  • How the protection of insurance policy cash value has evolved
“When McDonald’s sells a cheeseburger, they know exactly how much profit they turned that second. In a life insurance policy, you’re not going to know how much surplus was contributed by that individual policy until the policy turns.” — Ray Caucci Click To Tweet “When we price a product, we build models to analyze who is going to buy our product. On top of that, we analyze what policy behavior to expect from this particular demographic.” — Ray Caucci Click To Tweet “At the start of 2020, about 60% of our applications went through ACE. Of the applications that went through ACE, 60% ended up with a fluidless underwriting decision.” — Ray Caucci Click To Tweet “Up to this point, Penn Mutual has not had a significant number of COVID-19 deaths. We’ve had just over 200 claims, a total of around $18M, an average age of 82, and an average policy duration of 48 years.” — Ray Caucci Click To Tweet “People have different needs, different wants, and different thresholds of risk. We want to offer as many tools as we can to financial professionals so they can position our product for the needs, the wants, and the fit for each client.” — Ray Caucci Click To Tweet “The pandemic has put life insurance policies front-of-mind for many individuals, and companies like Penn Mutual have led the way in loosening their fluidless underwriting limits.” — Ray Caucci Click To Tweet “Term insurance is cheaper and shorter-term, while premiums on a permanent policy are levelized across the whole of life.” — Ray Caucci Click To Tweet “Every year, more than 80 million households are served and billions of dollars in benefits are distributed by private insurance companies, not government agencies. ” — Ray Caucci Click To Tweet