2015 Whole Life Insurance Dividend Analysis

You can find the latest Whole Life Insurance Dividend Analysis here.

In 2013 we released the industry’s first public analysis on variation in dividends for major participating whole life insurance products. This analysis focuses on variation and trend of declared dividend interest rate at the seven most competitive life insurers who issue participating whole life and will publicly announce/disclose their dividend interest rate (more on this point later on).

We’ve long argued that this sort of analysis is the best gauge of potential cash value performance in a whole life policy because it allows us to review how the company has managed business and investment operations given the axiomatic assumption that these life insurers will move heaven and earth to deliver the highest dividend award to participating policyholders. This foundational assumption has substantiating legal precedents.

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Historical Whole Life Insurance Dividend Changes: 2015 Edition

Historical Whole Life Insurance Dividend Changes

Whole life insurance dividend changes often happen once per year and we generally get excited near the end of the year when most companies announce these changes. We’ve been tracking and announcing changes when they become available for the past several years and will continue to do so in the future.

The anticipation for the announcement of the following year’s dividend focuses mostly around evaluating how well an insurance company is doing—especially with its block of participating life insurance—and how these results affect the dividend interest rate. We don’t get a lot of under-the-hood information about whole life insurance, so any metric we can use to look at how things are going is always appreciated, and dividend interest rates are one of those metrics.

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Whole Life Dividend Variation Analysis

Whole life insurance analysis

You can find the latest Whole Life Dividend Analysis here.

Whole life dividends are commonly reviewed and compared among companies. For the most part, all we see are current year rates compared. On the rate occasion, someone might bring up the average dividend interest rate among carriers over a certain time period—most often 20, because the people in marketing vaguely remember something about sufficient sample sizes from the one elementary stats class they took in college, problem is they’ve misapplied the rule.

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028 Who’s Your Sugar Daddy?

028 Who’s Your Sugar Daddy

(Complete Show Notes Below)



In the 28th episode of the Financial Procast:

Looks like Ally Bank needs an ally

The Fed performed its most recent round of “stress tests” for the largest banks in America.  You know, the ones that are supposedly “too big to fail”.  Anyway, it seems that 17 of the 18 largest banks passed the test but there's one that didn't quite cut it.  Who's that you ask…Ally?  Who? Yeah that bank that seemingly came out of nowhere and suddenly owned prime time media with all of its commercials.

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Whole Life Dividends: Direct Recognition

Whole Life Dividends

Picking up from where we left off last time on whole life dividends, direct recognition is the opposite strategy to non-direct recognition.

It’s the newer approach to handling the payment of dividends when a policy loan is outstanding, and it’s frequently championed as the feature that allows life insurers to pay higher dividends on non-collaterally assigned policy values (hereinafter, “non-loaned policy values” because its slightly shorter and how we generally refer to it).

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