NY Life Div announcement

[Lloyds of Lubbock]

Nice bump for NY Life.
Years ago in these memos, companies would also speak to the other components of the dividend.
Mortality and Expense.
A company could raise it's rate and increase other expenses in the dividend to negate the increase.
Will be interesting to see what Mass, Guardian and Penn do

 

[DHK]

Mass announced theirs 10 days ago:

MassMutual announces Record Policyowner Dividend Payout:

Springfield, MA, November 6, 2023 – Massachusetts Mutual Life Insurance Company (MassMutual) today announced that its 2024 dividend payout, estimated at nearly $2.2 billion, is the largest in the company’s history. The company has paid dividends to eligible participating policyowners every year since 1869.

6.1%

https://www.massmutual.com/about-us...nd2a8zTH71IBL-8TkJB-ULHY3xV_LqgY1wvFVx-5lyXGs

 

[walthamny]

ABC Mutual insurance company announces record/highest ever dividend payout in year XXX. ABC Insurance Company has been paying a dividend since BC XXXX. This format has not changed in 18 years I have been hearing these.

 

[DHK]

OneAmerica just announced their dividend for 2024.

"The OneAmerica Board of Directors has approved an estimated dividend payment of more than $32.4 million to eligible policyholders in 2024."

"In addition we will increase our dividend scale for new business and specified existing policies for 2024."

"Throughout our 146-year history, the companies of OneAmerica have remained financially stable and resilient because of our core values as a mutual organization. For 2024, we are pleased to announce a dividend payment of more than $32.4 million, a 13% increase over 2023 and a 10-basis point increase in the dividend interest rate."

[emphasis added]

One thing about OneAmerica that you'll notice is that they don't (and won't) quote their dividend as a % as it is often misinterpreted by agents.

[EXTERNAL LINK] - Salesforce

 

[DHK]

PennMutual declares $200m dividend payout

[EXTERNAL LINK] - Penn Mutual Declares $200M Dividend Payout | Gateway | Penn Mutual


2024 Dividend Award Frequently Asked Questions

Question: What is Penn Mutual’s dividend award action for 2024?

Answer: Penn Mutual announced an estimated $200 million dividend award for 2024, the highest in the company’s history.

Question: Did the dividend scale change for 2024?

Answer: The dividend scale remained unchanged for 2024. The interest rate component of the 2024 dividend scale for Penn Mutual whole life products sold since 2008 is 5.75%. The rate for older products varies. For dividend accumulations in 2024, the credited interest rate will remain at 3.5%.

Question: What were the primary contributors to the increase in the 2024 dividend award?

Answer: Diversified lines of business, strong product offerings, a prudently positioned investment portfolio and consistent operating results have been the key to continuing to grow the company’s total adjusted surplus, along with its dividends. Total adjusted surplus is now in excess of $3 billion.

Question: If interest rates remain where they are, would you anticipate any changes to the 2025 dividend scale?

Answer: As our reinvestment rates are rising in the current environment, we would anticipate an increase to the interest component of our dividend scale in 2025 should rates remain unchanged.

 

[Lloyds of Lubbock]

This is a bit of an odd statement:
Answer: The dividend scale remained unchanged for 2024. The interest rate component of the 2024 dividend scale for Penn Mutual whole life products sold since 2008 is 5.75%. The rate for older products varies. For dividend accumulations in 2024, the credited interest rate will remain at 3.5%.
So if you bought a product prior to 2008, your dividend crediting rate is lower?
I am assuming lower as if it was higher, they probably wold have mentioned it.

 

[scagnt83]

This is a bit of an odd statement:
Answer: The dividend scale remained unchanged for 2024. The interest rate component of the 2024 dividend scale for Penn Mutual whole life products sold since 2008 is 5.75%. The rate for older products varies. For dividend accumulations in 2024, the credited interest rate will remain at 3.5%.
So if you bought a product prior to 2008, your dividend crediting rate is lower?
I am assuming lower as if it was higher, they probably wold have mentioned it.

Yes. They issued a new WL line in 2008, another after the recent 7702 updates.

Only those 2 products get the published Dividend of 5.75%

Older policies got screwed.... at the expense of the new policy holders.

They paid out 105% of their life earnings in Dividends in 2022. 154% in 2020.

I wonder if 2023 will remain over 100% of their revenue.... ??!!!

Better hope that BD stays profitable..... not a business model Im fond of anymore.

 

[scagnt83]

PennMutual declares $200m dividend payout

[EXTERNAL LINK] - Penn Mutual Declares $200M Dividend Payout | Gateway | Penn Mutual


2024 Dividend Award Frequently Asked Questions

Question: What is Penn Mutual’s dividend award action for 2024?

Answer: Penn Mutual announced an estimated $200 million dividend award for 2024, the highest in the company’s history.

Question: Did the dividend scale change for 2024?

Answer: The dividend scale remained unchanged for 2024. The interest rate component of the 2024 dividend scale for Penn Mutual whole life products sold since 2008 is 5.75%. The rate for older products varies. For dividend accumulations in 2024, the credited interest rate will remain at 3.5%.

Question: What were the primary contributors to the increase in the 2024 dividend award?

Answer: Diversified lines of business, strong product offerings, a prudently positioned investment portfolio and consistent operating results have been the key to continuing to grow the company’s total adjusted surplus, along with its dividends. Total adjusted surplus is now in excess of $3 billion.

Question: If interest rates remain where they are, would you anticipate any changes to the 2025 dividend scale?

Answer: As our reinvestment rates are rising in the current environment, we would anticipate an increase to the interest component of our dividend scale in 2025 should rates remain unchanged.

A better question is "what happens to the dividend if B/D revenue decreases significantly.

Penn Dividends are propped up by the B/D being profitable.

No coincidence about the 2008 product line and up being the only ones getting the published Dividend. They bought low and rode the market up.... and put it into WL dividends to market a "consistent dividend".

But its only been "consistent" for policies purchased since 2008.

 

[Lloyds of Lubbock]

I guess they do not appreciate their older policyholders.
It is a bad look for the company.
A 2008 policy could possibly be on offset, now you give them a lower dividend?
You are taking a group of policyholders and having them subsidize new clients.
How long does it take for newer clients to become older clients and now their policies are subsidizing new clients.

 

[DHK]

Penn also has various loan rates depending on product and year of purchase.

So if you bought a whole life policy in 1989, your loan rate is 9.25%.

But if you bought a WL policy in 2012, your loan rate is 5.00%.

I don't know what the methodology is behind it all.