Shenandoah Life Sales Suspended

[insuranceexec]

You seem to have all of the answers. That's good.

$70 million doesn't seem like that much....anymore.

Just a guess, since I didn't get my commission from them this morning...bye-bye commission. I guess $208.66 is too much to Shenandoah Life....oh well, I've got plenty of forms to throw on my next pit-burning of leaves.

Time to replace...just call me flipper............

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I bet those policyholders won't miss this.....

"HOW DO I PRESENT A CLAIM FOR ANNUITY
SURRENDER?
Answer: Your annuity surrender should be presented in writing on the
form provided by the company for that purpose and signed by
the person entitled to payment. You should do so by mail.
However, you should note that a moratorium has been
temporarily imposed on such surrenders and no payment can
therefore be made at this time."...........


Uh...sorry friend that I see all of the time at my local Wal-Mart....no, you can't get your money. This is why I'm not in love with investing in insurance companies. Sorry...I don't trust them anymore.
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I knew Shenandoah was in trouble...they got downgraded....then OneAmerica was buying them....then the 11th of February they say no...the next day...Shenandoah is history.

Good post! And you're right...don't put all of your eggs in one-basket.

Reality...if M of O goes under, I'd be screwed, big-time.
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One more point....in the entire 2 links that Joe Moore provided, that are also available on the Shenandoah Life website...one thing that's never answered or even brought up...the agents that worked for this company and their commissions. Not a F'n word.

My point there Russ is that many agents should do more research into the companies they are doing business with. It was said in another thread that just because a company is the cheapest; does not make them the best. This is TRUE!

When the bond rating companies got into trouble for not properly rating bonds that was a sign.

Insurance companies have to buy investment grade bonds to add to their portfolio's. With this being said I will give you an example:

ABC company knows that they can only buy A or better bonds. ABC has several bonds that are maturing that they bought several years ago. They start looking for new bonds and call their Bond Wholesaler.

Bond Wholesaler gives them a list of A rated or better bonds and find that they can get better rates buying A rated bonds through Fannie and Freddie; these are called MBS (Mortgage Backed Securities). They buy them; and get a good rate of return. The better the return the cheaper the life insurance expense charges and better the interest rate on annuities are. As these charges are off set by the higher than expected return from the bonds.

A couple of years later they realize that their bond portfolio is in trouble, as they stop receiving their income. Those A rated bonds SHOULD have been given a grade of B. If they were in fact given a B rating they never would have bought them and included them in their bond portfolio. So who is to blame?

The government for making mortgage companies buy sub-prime mortgages?

The bond company for improperly rating the bonds?

In going back and reading some of your past posts you have complained about companies for the last two months. You gripe and complain about companies not paying you; and you are entitled to be angry. Now it is time to do something about it. You will see in the near future that more companies will be taken into receivership. Yes, when a company is taken into receivership they limit the withdrawal benefits of annuities.

Again this is an example; and there are many moving parts to this that I did not include.


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[Russ]

Thanks for the information. Got to head out the door and do something about it.....

 

[Mark]

I just found this on the web from a news station.

WDBJ7 Roanoke News and Weather NRV Lynchburg Danville | SCC named receiver of Shenandoah Life; OneAmerica calls off merger

Question 7: WHAT PROTECTION DO SHENANDOAH LIFE'S INSUREDS HAVE UNDER THE LAW?
Answer: Under the laws of the states in which Shenandoah Life does business, at least some of its insureds are afforded some protection by a "guaranty fund". These guaranty funds provide for payment of certain policyholder claims and other contractual obligations of the company, subject to conditions and limitations more fully set out in the statutes. See also Question 27.

Question 8: IS SHENANDOAH LIFE CURRENTLY PAYING ALL OF ITS CLAIMS?
Answer: No. At this time, the Deputy Receiver has imposed certain moratoriums upon policy loans (other than automatic loans), payment of cash or surrender values, surrenders, fund transfers, cash-outs, and similar payments and certain contract changes or conversions pending further orders. The moratorium may be adjusted as and when the Deputy Receiver and/or the State Corporation Commission find that the circumstances are appropriate. At this time, the Deputy Receiver will allow accident and health claims, death claims, and periodic annuity payments, and they will so continue until further notice.​

 

[Russ]

Another article on this... Roanoke-based Shenandoah Life Insurance is now under state control: The company must run decision-making through the state-appointed deputy receiver.


From the article.....

"The receiver's job, in part, is to ensure available funds are doled out according to legally established priorities that place policyholders and earned wages ahead of the interests of bondholders and, finally, shareholders, who stand last in line, Chaplinsky said.

"If nobody else steps in, I think they've probably lost their investment in this company," Chaplinsky said."

 

[G.Gordon]

May have something to do with the $70 million they lost last year (out of a $1.6 billion portfolio). Duh!

44% loss... Guess they got caught too heavily leveraged in RE, along with others that forgot the basic principle of diversification! Just a guess...

More like 4.4%... not 44%. It takes 1,000 millions to make a billion.

 

[Mark]

They need to call AIG and ask them how to get a loan from the GOVT. Hell, AIG got 80 bill.

 

[Russ]

They need to call AIG and ask them how to get a loan from the GOVT. Hell, AIG got 80 bill.

I thought about that too....

This...doesn't sound like agents will get commissions anytime soon, if ever.....from their website, this morning..........

"

• As Required by Law – Effective Immediately, Commission Payments will be Suspended until Further Notice. We understand that this creates a hardship for you and deeply regret this action. However, by law, we have no choice.
  • Individual Insurance commissions following this week’s cutoff will not be paid.
  • Group Commissions, overrides and bonus payments scheduled will also be suspended.
  • Commissions will continue to be accrued with the appropriate record keeping.
  • At this time, we do not know how long the suspension will be in effect or if “catch up” payments will be possible.
  • In due course, every person affected will have the opportunity to make a claim for amounts due."...................

NOTE: I didn't get this weeks cutoff either.

 

[stormtracker]

I thought about that too....

This...doesn't sound like agents will get commissions anytime soon, if ever.....from their website, this morning..........

"

• As Required by Law – Effective Immediately, Commission Payments will be Suspended until Further Notice. We understand that this creates a hardship for you and deeply regret this action. However, by law, we have no choice.
  • Individual Insurance commissions following this week’s cutoff will not be paid.
  • Group Commissions, overrides and bonus payments scheduled will also be suspended.
  • Commissions will continue to be accrued with the appropriate record keeping.
  • At this time, we do not know how long the suspension will be in effect or if “catch up” payments will be possible.
  • In due course, every person affected will have the opportunity to make a claim for amounts due."...................

NOTE: I didn't get this weeks cutoff either.

I wonder if PREMIUMS have been suspended???

 

[Joe Moore]

"If nobody else steps in, I think they've probably lost their investment in this company," Chaplinsky said."

The policyholders are the owners, this is a mutual company.

As we have 300 or so agents with Shen, you can imagine our telephone ringing off the hook. I can't imagine how many calls the home office is getting.

 

[LJSCLA]

Wow....hate to see that on the commissions. Shenandoah Agents, seriously...think about Colonial Life.