The Chinese curse, "May you live in interesting times," comes to mind as I think about the new millennium.

Where insurance regulatory issues and product complexity are concerned, the new era may well qualify as "interesting times." I'll cover some of the possibilities here.

The annuity landscape has already been affected, by the adoption of the Annuity 2000 Mortality Table.

Furthermore, the Society of Actuaries and the American Academy of Actuaries are being pushed to develop a 2000 Commissioner's Standard Ordinary Mortality Table - to take into account the apparent longer life span of Americans in the 1990s and projected into the 21st century.

When the table is developed and adopted, it will alleviate the practical problems of providing insurance benefits beyond age 100. Insurers will be able to price and reserve life insurance products that truly go to the end of life even if death occurs well after age 100.

Greater longevity, though universally desired, is creating some other challenges for the industry, too. This stems from the anxiety longevity can cause - i.e., will a person's planned retirement income provide enough money to allow the desired standard of living to the end of life?

Insurance products that seek to address this, by maintaining the real monetary value of retirement income via a variable monthly income based on separate account performance, are not uncommon today. But recently, some insurers have begun dealing with this by offering not only a variable payout (to reflect current market values) but also a minimum guaranteed income feature (to provide a safety net of a floor on the monthly income). This brings new regulatory concerns - mostly over which reserve method is most appropriate.

Another scene to watch is the arrival of new emerging markets and marketing strategies, born of the Financial Services Industry Modernization Act and mergers such as the one between Travelers and Citicorp.

Already, we are seeing the use of discretionary group trusts in marketing scenarios to customers of financial institutions and affinity groups gain popularity. States continue to review the type of group as well as the product; and the regulatory environment of the discretionary group trust is still fluid.

Currently, most states allow these trusted groups. However, some do not allow them for life products or annuities or both, and some evaluate the nature of the group and determine, on a case by case basis, whether or not they will allow the group.

In the future, as other financial institutions and insurers enter mergers, we may see more products marketed via the discretionary group trust.

E-commerce will also impact the insurance industry. The industry is already grappling with problems it brings. These include: electronic signatures, security of financial information, confidentiality, and the application of state regulatory requirements, all related to products sold over the Internet.

At the current rate of technological advance, more challenges will surface and be met at an ever-increasing pace.

Confidentiality of personal medical information, as well as privacy on the Internet, is a widespread concern now, and will continue to be.

Congress is already addressing confidentiality of personal medical information. The ramifications of federal legislation in this area, though not yet felt, are feared to be quite pervasive. Insurers may be responsible for safeguarding personal medical information, not only in their own company, but also in a subcontractor company when the insurer gives such information to the subcontractor for underwriting, consumer reporting, administrative or other purposes.

To manage the ramifications of the legislation now under consideration, insurers seeking to ensure confidentiality of personal information may find they have a new and significant need for relevant software.

Both financial services reform and issues related to confidentiality of personal medical information will probably enlarge dual regulation for the insurance industry.

The business is, of course, already subject to dual state/federal legislation for variable products and certain health products. Some observers speculate federal regulation will take over all insurance regulation, so the states will no longer regulate insurance products. In my opinion, this will not happen. But I do believe the industry will be increasingly subject to dual federal/state regulation.

As noted earlier, if not now, certainly during the early 21st century, the industry will experience the challenge of "interesting times."