Brandon Roberts 
The Pennsylvania Mutual Life Insurance Company announced today its plans to pay $33.2 million in dividends to its participating policy holders in 2014.
This payout represents a 7% increase in the total amount of dividends paid to Penn Mutual policy holders.
And what about the dividend interest rate?
Principal National Life has released its product for the indexed universal life market. Indexed Universal Life FlexSM is the name of the product and it carries some interesting features including an S&P 500 Total Return indexing fund (i.e. taking dividend reinvestments into account, this is a first for the indexing world).
We’ve only taken a cursory look at the product so far, but here’s what we like and don’t like about it.
New York Life has announced its plans to pay $1.43 billion in dividends to its participating policy holders. This dividend payout is an increase of $109 million over last year.
In a very quiet announcement, the company reported on a number of positive sales results of various products–including 10% sales growth of its whole life product through Q3.
What does this mean for the dividend interest rate?
The Metropolitan Life Insurance Company has announced its intentions to pay $1.25 billion in dividends to participating policyholders. Policyholders include both MetLife, New England Financial, and General American policyholders.
What does this total payout mean for the dividend rates?
We've discussed life insurance company ratings a couple of times from an informational point of view. Today I want to discuss the topic from a practical point a view (i.e. what's the overall benefit to the end user?).
Some companies would have you believe that their top tier rating means only they have the ability to weather economic downturns and that everyone else is headed into receivership. I used to work for a career mutual where the inference was always “buy from us because we're well rated.” And in 2008 when my career company was the only one in the industry to be upgraded twice by two of the major credit rating agencies and increase its dividend interest rate, you'd better believe that we sang this news from the roof tops (in fact, I will have the full page Wall Street Journal ad Guardian took out just to gloat about these accomplishments).
But does it really matter? In 2008 (and let's be honest every year following) we those (now) Guardian agents had no problem brandying about the news of the company's financial success. But it's not like others who didn't fare as well have gone the way of Shenandoah Life (which is actually still alive and well).
National Life Group of Vermont announced its plans to pay $83 million in dividends to its participating policy holders. In the announcement National Life Group's President and CEO, Mehran Assadi remarked at NLG's history going back to its very first dividend payout of $11,260 back in 1855.
So where does this leave the dividend interest rate?
Ohio National Life has announced the dividend interest rate for 2014. In an announcement from President and CEO Gary “Doc” Huffman, ONL noted its great expense management, strong portfolio performance, and very favorable mortality experience. No word on what the total dividend payout is for the entire company (not that it matters much to any single individual).
So what’s the new rate?
Whole life insurance dividends have long mystified both consumers and agents. We know that once per year, the mutuals and other companies that issue participating whole life insurance release press releases to announce the dividend payout for the following year. And usually (but not always…New York Life…) the companies will typically release what this payout means to the dividend interest rate.
And it's this dividend interest rate that causes so much confusion across parties. So how does it work, and what does it mean? When a company pays a 6% dividend, what is it paying 6% on?
Northwestern Mutual has announced that it plans to pay $5.2 billion in dividends to participating policy holders next year. This represents an increase of the total payout over last year of roughly $200 million. 90% of this payout will go to whole life policy holders.
But as we know the bigger consideration is what does this mean for the dividend interest rate?
MassMutual announced its plan to pay $1.49 billion in dividends to participating policy holders in 2014. This will be the largest total dividend payout the company has made in its 162 year history.
We all know the total payout doesn't mean much to the individual policy holder. We all want to know what that means the effective dividend interest rate will be.
And the answer is…
