Mutual of Omaha is a mutual insurance company which means that the policy holders own the company. I have been told that Mutual of Omaha does not pay a dividend on its whole life or universal life products. If that is the case, then given Mutual of Omaha has a very profitable year, how would the profits be distributed to the policy holders who are the owners of the company?
Mutual of Omaha Dividends
- Thread starter rkieltyka
- Start date
- 16,877
Businesses don't have to take profits unless they want to. They can reinvest into their business, give executive bonuses, etc.
Look at not for profits like AARP. When they have hugely profitable years (like every year for them) they just bonus it out and ...poof...no profit.
Most ULs including ones issued by mutuals do not pay dividends. The "profit" is expressed in the form of additional interest above the guarantee. But are you sure about no dividend on their WL? If their pricing assumptions use a high interest rate, then it's possible that their dividend scale would be minimal (since most of the company's expected profitability is already assumed in the pricing). Is this a non-participating product?
- 10,318
Yes. And its SI.
- - - - - - - - - - - - - - - - - -
ULs do not receive dividends, they receive an interest rate.
Dividends are expressed as an interest rate above the guaranteed rate.
Their WL is Non Par, and is just a FE product.
Last edited:
- 436
Interesting...probably the only mutual life insurance company in existence without a participating whole life product 
Whats the value proposition to stay mutual then? Suprised the execs havent cashed in for their big pay-day and become public.
Whats the value proposition to stay mutual then? Suprised the execs havent cashed in for their big pay-day and become public.
- 15,041
Interesting...probably the only mutual life insurance company in existence without a participating whole life product
Whats the value proposition to stay mutual then? Suprised the execs havent cashed in for their big pay-day and become public.
Why attract attention if you can just quietly bonus yourself every year? Right now they have an annuity.
- 10,318
Im pretty sure that they are a Mutual Holding Company.
So while it is about diverting revenue.... its not because they dont pay a dividend on their WL.... its just a NonPar product.
To say that just because they dont have a Par WL "they are ripping off policy holders" would be wrong.
That would mean that all non "Par WL" policies issued by mutual companies are a rip off...
Mutuality benefits policy holders in ways other than dividends.
But imo any Mutual who is a MHC has "re-positioned" themselves from being 100% on the side of the policy holder.... and that is most mutuals these days
So while it is about diverting revenue.... its not because they dont pay a dividend on their WL.... its just a NonPar product.
To say that just because they dont have a Par WL "they are ripping off policy holders" would be wrong.
That would mean that all non "Par WL" policies issued by mutual companies are a rip off...
Mutuality benefits policy holders in ways other than dividends.
But imo any Mutual who is a MHC has "re-positioned" themselves from being 100% on the side of the policy holder.... and that is most mutuals these days
Similar threads
