Mutual of Omaha Joins The Party

[Chuckles21]

Just curious. What is the guarantee that NML will continue paying a dividend for 25 years or not raise the price?

Rick

Do people not read what i write? As stated in my previous post:

"not that we can't raise rates but if we are giving money back that would go away first"

I never said anything was guaranteed. On the other hand we have paid a dividend on our life products every year since 1872, on our DI every year since sometime in the 70's and now our LTC, which is only 12 years old, for 5 straight years. Chances are good although not guaranteed that this trend will continue.

 

[Mr_Ed]

Who says I can't and don't at times sell other companies? There is nothing in my contract saying I can't write outside of NML and sometimes it makes sense to in the interest of the client. Honestly I actually have more at my disposal as I have one of the strongest carriers, NML, that you cannot offer.

One other thing you are failing to realize is strength of contract plays a larger part, in my mind, than premium. There is a reason our contracts are higher priced. We price to pay claims not to lure people into policies.

If you asked most people I think they would rather know exactly what they will be paying for a policy throughout the years, not that we can't raise rates but if we are giving money back that would go away first, than have a huge unknown of where the price could go. Raising rates is not a good indication and there is absolutely no arguing that point.

Just curious, name your so called way better $2000 company and let's look at strength of contract and carrier and then talk.

I'd love to compare strength of contract.
Please post or email a specimen policy.

 

[Chuckles21]

I'd love to compare strength of contract.
Please post or email a specimen policy.

What do you want to see. Male? Age? Couple? Inflation Riders? or merely what the contract says?

 

[Mr_Ed]

What do you want to see. Male? Age? Couple? Inflation Riders? or merely what the contract says?

You said, "... let's look at strength of contract..."

Show us how the NWM contract is better at the time of claim.

 

[Chuckles21]

You said, "... let's look at strength of contract..."

Show us how the NWM contract is better at the time of claim.

You have to give me a contract or contracts to compare it to. Did this little fact escape you?

 

[Mr_Ed]

You have to give me a contract or contracts to compare it to. Did this little fact escape you?

How about Pru LTC3?

 

[VolAgent]

You have to give me a contract or contracts to compare it to. Did this little fact escape you?

If you are talking strength of contract at claim time then age, gender, etc. don't matter. You just have to look at the language in the specimen contract. They are all the same once you get past the first page.

 

[Chuckles21]

How about Pru LTC3?

Sounds good, Pru's contract is not a bad contract but there are a few areas where I believe we have a better product.

1. Elimination period:

NML: Uses weeks instead of days and any day within that week where care is needed makes the whole week count.

Pru: Uses days and each day only satisfies that single day.

Example: NML's 12 weeks vs Pru's 90 days ( I know not perfect as 12 weeks comes to 84 days but close enough)
Say a person only needs care/help 3 days a week. For NML those 3 days, or even just 1 day, in that week where care was needed counts towards eliminating a full week of the period. So this person could start receiving a benefit from his policy after 12 weeks or a total of 36 days of care. With Pru's contract this person would still be 54 days away from their elimination period being satisfied. All these days needing to pay for that care out of pocket. This could rack up a good bit of a bigger bill with Pru than with NML. This also ties nicely into my second point.

2. Waiver of Premium:

NML: Waiver starts once need for LTC is proven not once elimination period is satisfied

Pru: Waiver starts once elimination period is satisfied.

Example: Use same example as above. Although person with NML contract was paying out of pocket for those 12 weeks, 36 days, they didn't have to worry about also paying the premium for their LTCi. The person with the Pru policy is having to pay out of pocket for care those same 36 days, plus the next 54, and during that whole time they still need to pay the premiums on their LTCi. Another way that they could rack up a bigger bill.

3: Benefit structure: monthly vs. daily (this one you may have to check on for me)

NML: States and pays a maximum monthly benefit

Pru: States and pays a maximum daily benefit (correct if wrong as I heard you possibly can do monthly but it is a rider)

Example: Again lets use our first example for structure. NML $4500/m ($150/d x 30 days) benefit vs. Pru $150/d benefit. Say that same person needing only 3 days of care a week has costs on each of those days of $200. Total cost per month of $2400 ($200/d x 3 days/week x 4 weeks). With NML's contract all $2400 would be paid for. With Pru's $50/d would still be needed to be paid out of pocket or $600/m.

4: Lifetime benefit and the lack thereof

NML: Lifetime is an option

Pru: Not an option as of April 4th, 2011

Example: God help any of your clients with Alzheimers that will need care for Longer than 10 years.

5: Retroactive Contract Benefits (Benefit of being a Mutual)

NML: Offers any new benefits/changes in contracts to not only contracts sold from that date, but also to older series contracts already in place.

Pru: Stuck with what you bought.

Example: Let's use the Monthly vs. Daily benefit amount here. NML used to have a daily limit and once we saw that it was in the better interest of our clients to have a monthly benefit we changed it for our new contracts. Now if it is in the better interest of our clients what happens to the contracts that we sold with the daily benefit. Pru would say "To bad, you are stuck with what you bought." NML says "We are mutual and want to make sure we treat all our LTC clients fairly." We will offer to exchange your older contract to the newer one with better options/benefits without underwriting involved. By the way Pru not only doesn't offer this to it's past series holders, it raised both series 1 and 2's premiums. Thanks for buying our contracts, here is what you get for being a loyal customer.

Some pretty big differences in my mind that could lead to all your "saving" from the lower premium being for naught.

 

[Mr_Ed]

Sounds good, Pru's contract is not a bad contract but there are a few areas where I believe we have a better product.

1. Elimination period:

NML: Uses weeks instead of days and any day within that week where care is needed makes the whole week count.

Pru: Uses days and each day only satisfies that single day.

Example: NML's 12 weeks vs Pru's 90 days ( I know not perfect as 12 weeks comes to 84 days but close enough)
Say a person only needs care/help 3 days a week. For NML those 3 days, or even just 1 day, in that week where care was needed counts towards eliminating a full week of the period. So this person could start receiving a benefit from his policy after 12 weeks or a total of 36 days of care. With Pru's contract this person would still be 54 days away from their elimination period being satisfied. All these days needing to pay for that care out of pocket. This could rack up a good bit of a bigger bill with Pru than with NML. This also ties nicely into my second point.

2. Waiver of Premium:

NML: Waiver starts once need for LTC is proven not once elimination period is satisfied

Pru: Waiver starts once elimination period is satisfied.

Example: Use same example as above. Although person with NML contract was paying out of pocket for those 12 weeks, 36 days, they didn't have to worry about also paying the premium for their LTCi. The person with the Pru policy is having to pay out of pocket for care those same 36 days, plus the next 54, and during that whole time they still need to pay the premiums on their LTCi. Another way that they could rack up a bigger bill.

3: Benefit structure: monthly vs. daily (this one you may have to check on for me)

NML: States and pays a maximum monthly benefit

Pru: States and pays a maximum daily benefit (correct if wrong as I heard you possibly can do monthly but it is a rider)

Example: Again lets use our first example for structure. NML $4500/m ($150/d x 30 days) benefit vs. Pru $150/d benefit. Say that same person needing only 3 days of care a week has costs on each of those days of $200. Total cost per month of $2400 ($200/d x 3 days/week x 4 weeks). With NML's contract all $2400 would be paid for. With Pru's $50/d would still be needed to be paid out of pocket or $600/m.

4: Lifetime benefit and the lack thereof

NML: Lifetime is an option

Pru: Not an option as of April 4th, 2011

Example: God help any of your clients with Alzheimers that will need care for Longer than 10 years.

5: Retroactive Contract Benefits (Benefit of being a Mutual)

NML: Offers any new benefits/changes in contracts to not only contracts sold from that date, but also to older series contracts already in place.

Pru: Stuck with what you bought.

Example: Let's use the Monthly vs. Daily benefit amount here. NML used to have a daily limit and once we saw that it was in the better interest of our clients to have a monthly benefit we changed it for our new contracts. Now if it is in the better interest of our clients what happens to the contracts that we sold with the daily benefit. Pru would say "To bad, you are stuck with what you bought." NML says "We are mutual and want to make sure we treat all our LTC clients fairly." We will offer to exchange your older contract to the newer one with better options/benefits without underwriting involved. By the way Pru not only doesn't offer this to it's past series holders, it raised both series 1 and 2's premiums. Thanks for buying our contracts, here is what you get for being a loyal customer.

Some pretty big differences in my mind that could lead to all your "saving" from the lower premium being for naught.

I appreciate your interpretation of the NML contract. I was hoping you'd provide an actual sample policy. Your interpretation is meaningless.

 

[Chuckles21]

I appreciate your interpretation of the NML contract. I was hoping you'd provide an actual sample policy. Your interpretation is meaningless.

Nice response, out of that whole informative, nicely laid out post the only thing you could come back with is calling me a liar? Is that to imply that you have no clue what NML's contract looks like? As you can see, I actually know my competition and get educated on them before making wild accusations.

I can and will show you a comparative contract, but first I want you to admit you are completely uneducated on the subject.