Sun Life LTC hybrid competition for Lincoln National

Sun Life Financial Inc. has officially thrown its hat into the LTC hybrid ring — a move that will put the insurer in direct competition with Lincoln National Life Insurance Co.

Sun Life is preparing to launch a long-term-care and life insurance combination product called Sun Care in the fourth quarter, according to Westley V. Thompson, president of the firm’s U.S. operations.

A second hybrid product, which would combine an annuity with LTC features, also is on the drawing board.

A hybrid life product would allow financial advisers to reposition assets to cover for a life insurance need. If long-term care is needed, a client can draw down on the product’s LTC feature, Mr. Thompson said.

Sun Life’s entry into the hybrid area, where it will compete with Lincoln National’s MoneyGuard Rserve, doesn’t come as a huge surprise. The insurer in recent years has recruited a number of executives from Lincoln National — so many, in fact, that some industry observers have come to dub the Toronto-based insurer “Lincoln North.”
Mr. Thompson, for one, was president of retirement solutions at Radnor, Pa.-based Lincoln National before joining Sun Life in 2008. Other Lincoln alumni now at Sun Life include Terrence J. Mullen, president of Sun Life Financial Distributors Inc., and Sun Life Financial president Jon A. Boscia, who served as president of Lincoln National for nearly a decade.

That group of executives was the brain trust in product development at Lincoln National, particularly in the hybrid LTC arena.

What’s more, Sun Life in January hired Bob Klein, former head of sales for Lincoln’s MoneyGuard Reserve unit, as vice president for strategic planning and linked benefits.

“We know the formula, the inertia of what we built,” Mr. Thompson said. “We have an opportunity [at Sun Life] to be a leader in linked benefits.”

It is hard to argue with the group’s track record.

“They have expansive expertise in it,” said Tamiko Toland, managing director for retirement income consulting at Strategic Insight. A hybrid product would be a “natural fit” for the insurer, she said, and would no doubt get the attention of advisers.

Lincoln spokeswoman Daniela Palmieri declined to comment on the move by Sun Life.

E-mail Darla Mercado at [email protected].