BMO Insurance is raising level-cost-of-insurance rates on its universal life products.
According to a release obtained by Advisor.ca, LifeProvider products that have face amounts between $25,000 and $500,000 will see an average rate increase of 13%.
Life Dimensions products with face amounts between $50,000 and $99,999 also will see 13% rate increases, on average. Those with face values above $100,000 will see average rate increases of 5%.
The company cites continued low-interest-rate conditions and high market volatility as the reasons for the increases.
BMO's decision follows rate increases by Manulife; other insurers, such as RBC, have suspended their permanent insurance products.
"These price increases will continue until either interest rates rebound or the price increases are sufficient to sustain the pricing at the low interest rates," says Byren Innes, senior vice president and director, NewLink Group.
There will be no reduction in compensation. Clients younger than 50 will experience higher-than-average rate increases.