There's no mystery to this. To understand a product, you walk backwards from illustrations to the internal load structure to the underlying assumptions about past, present, and future pricing factors. An experienced analyst can use these techniques to screen out aberrant products and to raise questions for further investigation. His premises are not unreasonable. The lender wants a high rate for a long time, and he doesn't want to lend more than the collateral is worth.
Insurers also add loading to their net premiums to cover their expenses and profit.
Dividends don't matter. Low distribution costs, high investment returns, excellent mortality experience, and administrative efficiency count for nothing. High early cash values don't matter. Advisors who evaluate policies this way will want to make sure that their errors and omissions coverage stays in force. Leaving aside Barnes's curious methodology, the book contains some basic errors.