2021 dividends

[Lloyds of Lubbock]

First of all.
I am retired from Guardian, whether you do business with them or not makes no difference to me and yes you do sound like you are bashing the company, so I am glad you clarified that. That being said I still have a soft spot for them.
When I was there (retired 5 years ago) we sold more separate term than q.
Option q was popular though. The profit margin from q or separate term was negligible from a corporate perspective.
One advantage of q is it qualifies for table shaving.
A big disadvantage is you want to convert in the first seven years , you could cause a MEC by converting the q.
If you want to get to 10 X base for your PUA (it is actually 13 in year one) you would have to use q in order to avoid a mec.
There are websites , (Insurance pro blog)that promote this type of sale.
Ever so called experts, google Glen Daily.
I hope they hold, I many friends still there.....and I own a lot of this stuff!
You can continue on the forum or contact me if you would like, I think we can move on.

 

[walthamny]

It is interesting that everyone here is looking at the percentage dividend rate, the whole mutual life industry is releasing press releases talking about the dollar of size of their dividends.

 

[scagnt83]

It is interesting that everyone here is looking at the percentage dividend rate, the whole mutual life industry is releasing press releases talking about the dollar of size of their dividends.

Dollar amounts sound good for press releases. Makes them sound like a gigantic company (which they are).

But its been that way for a while now. I seem to remember carriers maybe mentioning the actual dividend rate in older press releases from early in my career. But over the past 10 years or so I dont remember any putting the rate in the press release. Low rates probably have something to do with that. idk

But that number is meaningless to a client. $500m, $1b, $2b... all that matters to the client is the rate their policy gets.

 

[Lloyds of Lubbock]

Years ago dividend announcements were more forthcoming.
Today you get the rate and total dividends paid.
In the past the companies would disclose if mortality and expenses stayed the same or improved or not.
The dividend rate does not tell the whole story there is mortality rate and expenses.
Run an illustration at the guaranteed rate, the payable dividend will be the mortality and expense savings.
The total amount of dividends paid is a big number... it publicizes well.
If it was really indicative of anything we would all be selling NML.
I hope everybody had a great thanksgiving weekend.
I am going to watch the Giants replay......I dont get to watch a win all that often!

 

[DHK]

Ohio National's email on their dividend announcement:

The Ohio National Life Insurance Company Board of Directors has approved the payment of an estimated $85 million in dividends to our participating whole life policyholders in 2022. The payout reflects a dividend scale of 4.00% for open block policies (issued on or after Aug. 1,1998) and closed block policies (issued prior to Aug.1,1998). The Ohio National illustration software will be updated on Dec. 1, 2021 to this dividend scale.

The 2022 dividend scale reflects the impact of the continued low interest rate environment in the United States and the public pronouncement by the Federal Reserve Open Market Committee of its intent to maintain its current accommodative interest rate policy into the future. This low rate market environment has effectively pushed yields on bonds in our portfolio to lower levels. (See chart below.) Therefore, it’s necessary to adjust the dividend interest rate to better reflect investment yields available in the marketplace.

Company Financials

Ohio National has received high marks for financial security and claims-paying ability from major independent rating agencies. We continue to manage our business with a focus on the long-term financial well-being of the company.

We value the opportunity to serve your clients, today and in the future.

Barbara A. Turner, CRCP

President and Chief Executive Officer



All ratings information is according to reports published on: www.ambest.com/ratings, www.moodys.com/insurance and www.fitchratings.com. For the most current ratings, see www.ohionational.com .

Whole life insurance is issued by The Ohio National Life Insurance Company. Dividends are not guaranteed. Product availability varies by state. Company not licensed to do business in NY.
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE GENERAL PUBLIC. D-719004 10-21

 

[DHK]

4%... that's the guaranteed minimum on current business.

Such spin.

 

[Lloyds of Lubbock]

When Ohio Natl went from a Mutual to A Mutual Holding Company, they closed the block of business an immediately went to 4% on that business.
Why would you think this time would be any different?
That being said the guarantees on their 10 pay are pretty strong.
Whether they pay divs or not it is still a ten pay.
It will be interesting to see how they distribute the 500 million from the sale.

 

[DHK]

When Ohio Natl went from a Mutual to A Mutual Holding Company, they closed the block of business an immediately went to 4% on that business.
Why would you think this time would be any different?
That being said the guarantees on their 10 pay are pretty strong.
Whether they pay divs or not it is still a ten pay.
It will be interesting to see how they distribute the 500 million from the sale.

I didn't have any expectations. I guess just seeing this announcement with such 'spin' when they're simply paying out the guarantees and calling it a dividend... is quite bold to people who would know better.

Agreed that a 10-pay is still a 10-pay and very strong.

Hopefully they'll get the vote on that $500 million and finalize the sale so we can figure out the nature of the new beast that is being created.

 

[Lloyds of Lubbock]

We always hope for the best.
The 500 million just seems like a replacement of the dividends they are choosing(?) not to pay.
My former firm financed many of these policies and they are going to have a rough road with clients and the banks that did the financing.

 

[Lloyds of Lubbock]

Late to the table as usual but Guardian held their interest rate and no changes to mortality and expense.