ATLANTA, GA--The year 2005 should be challenging, with additional complications from regulatory and legislative issues, say members of the LOMA Board of Directors. LOMA's Resource magazine surveyed members of LOMA's board for their views on what the industry can expect in 2005.

Most of the participating board members think that sales, premiums and profits are poised to continue the modest growth witnessed in 2004, with universal life and variable annuities looking particularly robust. In addition, the general consensus is that the ongoing pressure on companies to reduce expenses and realize economies of scale will keep merger activity moving forward.

Not surprisingly, the board agrees that regulatory and legislative issues will preoccupy the industry in 2005. Many LOMA board members think the recent investigations of brokers and insurance companies will have a profound impact on how compensation, disclosure and product marketing, among other functions, will be handled in the future.

According to the forecast, the political environment can be expected to provide challenges for the life insurance industry. Retirement savings and Social Security reforms are expected to be priority issues.

Here are highlights of the 2005 Industry Forecast, which is posted on the Resource section of the LOMA Web site,

Sales, Premiums and Profits: Continued modest growth in these areas can be expected. Universal life and variable annuities look strong. Some expect variable universal life (VUL) and long-term care (LTC) product sales to be weak; others predict a turnaround.

Mergers, Acquisitions and Consolidations: More are on the way, but at a slightly slower pace. Mergers on the scale of MONY-AXA and Manulife-John Hancock will be less frequent.

Insurance Companies as Financial Services Companies: Some board members say that today's increasingly competitive marketplace makes this strategy essential to survival. Others warn that unless you're prepared to be the one-stop financial superstore that the name implies, don't go there.

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