Our insurance regulatory and litigation team works side-by-side with multi-national and regional insurance companies, financial services firms and their in-house and outside counsel. We have served as investigators on behalf of clients, running their internal U.S. and international fact-finding efforts, so that management and counsel are in command of the facts in order to make the best-informed decisions while engaged in disputes, litigation, or regulatory inquiries and actions. Our role in both internal and regulatory investigations and litigation is that of a partner to our clients and their counsel, bringing our technical, industry, fact-finding, analysis and managerial expertise to address the issues.

Our insurance experts have frequently been retained to consult or testify regarding suitability and sales practices of life insurance and annuity products.  Accordingly, Bates is uniquely qualified to assist our clients in navigating the evolving regulatory requirements regarding the standard of care.


Bates Group’s experts have provided valuable insights on all aspects of annuities on both a consulting and testimony basis. 

Our experienced team provides services, guidance and/or testimony on the inclusion of annuity products in investor portfolios, including choosing the right annuity for a client's needs, and are very familiar with all the selections that need to be made when purchasing fixed, variable and equity indexed annuities. 

In addition to calculating the annuity profit/(loss) and other performance metrics, Bates has deep experience in analyzing, and creating exhibits addressing, living and death benefit provisions in annuity contracts, including: Guaranteed Minimum Accumulation Benefit (GMAB), Guaranteed Minimum Withdrawal Benefit (GMWB), Guaranteed Minimum Income Benefit (GMIB) and enhanced death benefits. Displaying the intrinsic value of these benefits at select points in time in comparison to ending/accumulated value has been very effective in cases where contracts were surrendered during the recent financial crisis, and the value of these additional features need to be considered in evaluating the surrender or exchange.

For some contracts that have been surrendered or exchanged at a low point in the market, Bates has prepared “what if” scenarios projecting the hypothetical living/death/portfolio values from a historical date to a future date to capture the appreciation that would have occurred if the contracts had been maintained.

Bates experts have provided opinions on the suitability of annuity switches. These cases include retail litigation as well as regulatory matters and range from an individual 1035 exchange to regulatory matters involving hundreds of exchanges.

If necessary to specific case issues, we also have the capability to incorporate actual or hypothetical withdrawals into our analyses and to identify the tax implications involved with different hypothetical scenarios. In supporting our clients we have also pioneered a present value analysis of living benefits that incorporates life expectancy considerations. 

Life Insurance

Bates Group LLC brings our firm wide experience with litigation testimony and consulting experts and combines that with a deep understanding of the nuances and unique complexity of the life insurance field through our life insurance practice area.   Our experts, with years of industry experience and credentialing, consult, advise and testify on matters concerning life insurance products, practices and standards for brokers, agents and registered representatives. 

Over the years, the array of life insurance options has expanded to give consumers the benefit of a diversity of choice. Bates Group’s consultants and experts provide testimony regarding variable, universal, permanent, and term life insurance. We also provide guidance on stranger originated life insurance (STOLI), corporate owned life insurance (COLI), bank owned life insurance (BOLI), life settlements, as well as in the broader field of life insurance underwriting, including the issuance process.     

Property & Casualty Insurance

Our industry leading experts have consulted and provided reports and testimony regarding standard of care, property, liability, surplus lines, as well as personal lines of insurance.

Many of our cases have involved allegations that revolve around standard of care issues, where we can offer particularly specialized help.  Our experts can help in responding to claims that allege bad faith and/or deceptive trade practices, as well as cases that require an opinion concerning an agent’s errors and omissions claims.

We offer a range of expertise related to property insurance including coverage of the following areas:

  • property
  • business interruption
  • flood
  • inland marine
  • commercial ocean marine, and
  • crime insurance / Fidelity bonds.

Bates experts have also been called upon to offer opinions and testimony in connection with many forms of liability insurance, which include (but are not limited to):

  • commercial general liability
  • commercial auto liability
  • product/completed operations
  • pollution / environmental liability insurance
  • commercial umbrella / excess claims made
  • professional liability / errors & omissions
  • workers compensation
  • Directors & Officers liability, and
  • employment practices liability.

Bates experts have close ties with wholesale surplus line agents, which has allowed us to develop an extensive understanding of industry standards in managing general agents and the nuances of structuring coverage using non-standard policy forms.

We can also provide our clients with valuable insights related to personal lines of insurance including: personal auto insurance, homeowners insurance as well as personal umbrella insurance.

We welcome working with you on any insurance matter. Please contact Greg Faucher, Bates Group‘s Insurance Practice leader, to learn more about how Bates Group’s insurance consultants, analysts and experts can help you with your matter.

Examples of Bates Groupā€˜s Capabilities



We are frequently retained to assist our clients in regulatory matters brought by federal and state regulators:

  • Bates Group was retained to assist an insurance carrier during a FINRA investigation alleging the carrier’s misrepresentations, suitability violations, and supervision in connection with sales and replacements of variable annuities.  We analyzed thousands of pages of contract applications and internal documents pertaining to over 500 variable annuity exchanges to compile a database of annuity transactions.  Data validation techniques were used to check the consistency and accuracy of the dataset.  Once validated, the database was used to generate summary reports and schedules detailing our findings related to the alleged misrepresentations and omissions, which allowed counsel to rebut allegations and negotiate a more favorable result.  During the investigative process, Bates’ experts also consulted on the suitability and supervision of the annuity transactions.

  • As state regulators investigated an association’s deficient pre-need trust which held hundreds of variable life insurance policies, we were asked by counsel representing a financial services firm to analyze tens of thousands of pages of documents and perform a profit/(loss) analysis for each contract within the trust. Bates also constructed thousands of hypothetical scenarios comparing actual contract performance to various benchmarks to assess potential damage scenarios. Additionally, we analyzed millions of transactions within the client’s mainframe database and accounting system to provide counsel with insight and guidance regarding damages during the resolution process.

  • In another state regulatory matter involving a financial services firm, Bates Group worked directly with inside counsel to prepare an economic benefit analysis showing the impact of dozens of variable annuity switches.  The analysis used internal reports as well as Morningstar to evaluate the switches at the policy, benefit and fund levels.  Our analyses included review of surrender charges and premium enhancements to evaluate the potential damages associated with alleged variable annuity sales practice violations.  Bates also provided a substantive suitability review of selected switches.  In addition, we assisted counsel during this investigation by reviewing the damage calculations provided by the state and providing clarification regarding the calculation methodology. 


Our industry experts are frequently retained by counsel in state court to testify in matters concerning the suitability of annuity products in investors’ portfolios:

Living Benefits

We have prepared, and testified to, numerous schedules including Guaranteed Minimum Accumulation Benefit (GMAB), Guaranteed Minimum Withdrawal Benefit (GMWB), and Guaranteed Minimum Income Benefit (GMIB).  Displaying the intrinsic value of these benefits at select points in time in comparison to ending/accumulated values was very effective in cases where contracts were surrendered during the financial crisis. For some contracts that have been surrendered or exchanged at a low point in the market cycle, Bates prepared “what if” scenarios projecting the hypothetical living/death/portfolio values from a historical date to a future date to capture the appreciation that would have occurred if the positions had been held. Where appropriate, we have the capabilities to incorporate actual or hypothetical withdrawals and to also identify the tax implications involved. We have also provided present value analyses of living benefits incorporating life expectancy. 


To assist counsel in comparing the value of annuity contracts under various scenarios, Bates has prepared analyses that compare cash surrender values, annuitization values and annuity distributions of actual or hypothetical income streams at multiple points in time.  Our analyses can utilize life expectancy tables or model expected growth using Monte Carlo simulation with the results discounted into current dollars to assess damages, or provide damage alternatives.  Comparison of actual or hypothetical contract performance can also be evaluated against alternative investment products or portfolios.

1035 Exchanges of Annuities

In addition to evaluating annuity switches in regulatory matters, Bates has reviewed dozens of switches involved in retail litigation.  Our “Net Cost to Exchange” model has been very helpful for our clients and arbitration panels to better understand the quantitative and qualitative components of these exchanges including contract performance, bonus recapture, surrender charges and contract features.    


We have successfully itemized and compared fees within various insurance products to other investment alternatives. One comparison included variable annuity subaccounts and evaluated the cost of ownership to hypothetical investments in alternative class A and class C open-end mutual fund shares. Our analyses included a detailed breakout of annual fees, rider fees, sales charges and operating expenses to calculate the total cost of ownership.  

Life Insurance

We are frequently retained to assist our clients in analyzing and consulting on various life insurance products and policies:

Policy Continuation

When an estate initiated litigation against an insurance agency involving universal life insurance policies that had lapsed, Bates was engaged to calculate the hypothetical premiums that would have been required to keep the policies in force.  We provided a potential damages calculation which included hypothetical insurance premiums and death benefits discounted to present value. Our expert was also able to consult on the suitability and sales practices involved with the sale and maintenance of the universal life insurance products.

Life Settlements

A recent life settlement project included actuarial analyses of selected policies where the sellers were unable to find buyers in the secondary market. Our expert provided testimony regarding the policies as well the broad economic decline that generated a perfect economic storm in the second half of 2008 and the implications of those events for the life settlement industry.

Welfare Benefit Plans

The Bates team includes insurance, tax and damages experts who assist counsel in defending welfare benefit programs including 419(e) plans.  Our experts have consulted with counsel to explain how the insurance products work, discuss IRS tax implications and to calculate the economic benefit of these types of plans.

Asset / Sector Allocations

We have performed a large number of asset and sector allocations/analyses for variable annuity and variable life contracts. These analyses were useful in defending against suitability (concentration) claims and comparing to model portfolio allocations.


Bates has analyzed thousands of Annuity/Life Insurance contracts to determine gains or losses associated with Fixed/Variable/Indexed Annuities as well as Term/Whole Life/Universal Life/Variable Life Insurance products. For variable products, our analyses can identify subaccount performance as well as the overall contract’s performance.   

Professional Liability Insurance

Our expert was engaged by defense counsel to consult and opine regarding Agent Errors & Omissions relative to placement of a Broker-Dealer/Registered Investment Advisor(s) Professional Liability policy. The case involved evaluation of coverage afforded a named insured vs. additional insured, surplus lines, and claims made issues. Claims stemming from a Registered Investment Advisor’s fraudulent investment activities and subsequent conviction were denied by carrier which resulted in an Insurance Bad Faith claim against the agent. 

Contact Bates Group

Bates Group is with you every step of the way. Contact us today for more information on how our End-to-End Solutions can help your firm.

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