Reputable? Whole Life with Northwestern Mutual...

[VolAgent]

Annual premiums are cheaper, but it seems a little strange that your agent "never" works with people who pay monthly.

Give the agent a little credit. What he said is, "Paying monthly is not something I do on MY policies." He didn't say about his clients.

That said, he does seem to suffer from the typical Northwestern syndrome. "We are the only company worth owning."

 

[Death Cab For Tootie]

What I found really funny was the NML agent was proud of the fact that his company's illustrations from '82 were less wrong than their competitors.

Nothing like being the winner of the Tallest Midget competition.

 

[BNTRS]

Just to be clear...I've never sold a Northwestern term policy that didn't have a conversion option with it. Depending on the contract the option is either 10 years or to age 60.

Talking about term rider on a WL contract.

 

[dgoldenz]

Give the agent a little credit. What he said is, "Paying monthly is not something I do on MY policies." He didn't say about his clients.

That said, he does seem to suffer from the typical Northwestern syndrome. "We are the only company worth owning."

Sounded to me like he was referring "my policies" as his clients'. Either way, it was a very poorly written response.

 

[BNTRS]

The rate for unborrowed funds for NML starting 1/1/10 is 6.15%, on borrowed funds it is 5.6%. Some companies like to talk about direct recognition vs non direct recognition but what you really need to look at is the expense & mortality ratio’s and interest numbers from all companies you are looking at.

Yikes, this means not only do you loose dividend against borrowed amounts, you receive a lower dividend credit rate for it as well.

Expense and mortality ratios simply tell you how quickly you can access cash generated from paying premiums. They'll tell you nothing about how quickly cash will grow or how much it will over time.

NML offers a waiver of premium rider on their term & permanent policies. I have seen where some companies when an insured becomes disabled & they have a term policy, the company will only waive the term premiums. If you were to convert to permanent they won’t waive the perm premium only the term premium.

Ummm, your not buying term insurance so why would he even talk about this?

As far as Guardian charging less than NML for paying monthly I have no idea. Paying monthly is not something I do on any of my policies because you are paying extra regardless of the company.

I'm guessing you and he have discussed the fact that you will most likely be paying monthly. Is he suggesting that you shouldn't do this unless you can pay annually like he does? Not many people starting out like you are can do this.




With regards to his "study"...

I'd be curious to know what products NML is using. I've seen a fair amount of NML's "studies" that often times forget some key information. If you can get this and tell me what WL products are being compared I'd be very grateful for your efforts.

 

[bluemarlin08]

I am recommending some changes to 4 shareholders that own several large NWM policies, I should say the trustee owns the policies. We were asked by the trustee to review and make recommendations. Agents haven't met with the clients in 7 years, they will present their arguments against ULNL after Thanksgiving, will be interesting to see how they justify their current product, blend written 15 years ago.
Sure wish the NWM guy on ehre would tell me what happens one spouse dies in survivor policy, not real clear in policy.

 

[BNTRS]

I am recommending some changes to 4 shareholders that own several large NWM policies, I should say the trustee owns the policies. We were asked by the trustee to review and make recommendations. Agents haven't met with the clients in 7 years, they will present their arguments against ULNL after Thanksgiving, will be interesting to see how they justify their current product, blend written 15 years ago.
Sure wish the NWM guy on ehre would tell me what happens one spouse dies in survivor policy, not real clear in policy.

I'll sum up their argument for you, now.

ehem...


"We are the highest rated carrier in the industry with more life insurance in force than anyone else of our financial stability. In addition to that we've paid more dividends to our policy holders than any other company."

 

[bluemarlin08]

"We are the highest rated carrier in the industry with more life insurance in force than anyone else of our financial stability.

So was AIG as well?


In addition to that we've paid more dividends to our policy holders than any other company."

As defined by the IRS, dividends on life policies are considered refund of premium. So they have overcharged more people than any other company?

 

[ticker_shuffle]

Northwest mutual actually LOST money last year, so that surely did not translate into 6% dividend. I would shop around. If you are looking to overfund, you might want to try a variable product, assuming you are putting this much money into insurance because you have maxxed out other savings vehicles.

What are you trying to do with the insurance...what RISK are you trying to protect against?

 

[BNTRS]

"We are the highest rated carrier in the industry with more life insurance in force than anyone else of our financial stability.

So was AIG as well?


In addition to that we've paid more dividends to our policy holders than any other company."

As defined by the IRS, dividends on life policies are considered refund of premium. So they have overcharged more people than any other company?

See now you have to go and be all serious. The insurance part of AIG isn't the cause of their troubles. In fact it's relatively fine. Not too crazy about the products, but it's not like they are moribund.

If you want to get into technical definitions. When whole life insurance started to take hold in the U.S. regulation decided that premiums on WL weren't covering just a mortality factor and as such where in fact a practice of overcharging the consumer and therefore reguirements of the insurance company where put in place to share in the profits of this collection of extra money (this is not the dividend piece, it's the guaranteed crediting piece).

So yes you are correct in stating that by insurance regulation (and to a lesser degree tax regulation) WL in insurance is in effect overcharging. However, leaving it at that is only telling part of the story. Since WL is a return of premium product that includes a guarateed rate of interest--and a dividend with a quality company--the fact that I'm being overcharged isn't so bad. The money that I'm being overcharges after all is going into a really big mulity billion dollar bond fund (bascially bonds, with a tiny bit of stocks. mortgage securities, etc.). It has proven itself time and again to be a decent place to park money and receive a decent return.

There's more but, I'm of the opinion that I'm not telling you something you've at least heard part of before.
- - - - - - - - - - - - - - - - - -

Northwest mutual actually LOST money last year, so that surely did not translate into 6% dividend. I would shop around. If you are looking to overfund, you might want to try a variable product, assuming you are putting this much money into insurance because you have maxxed out other savings vehicles.

What are you trying to do with the insurance...what RISK are you trying to protect against?

Really variable? That's the last place I would see this individual going. You've not read much of this, the answer you ask was posted a long time ago. And not, maxing out other products isn't in his best interest based on what he's trying to accomplish.