Boston Globe Attacks Mutual Life Insurers

[BNTRS]

https://www.bostonglobe.com/busines...le-scrutiny/Ey4KCvQRrmpIkWllj9wUwN/story.html

I've long complained that life insurers in general can be a tad dodgy on the financial data and some of the mutuals have been among the most egregious violators.

Oddly enough I've always found MassMutual to be one of the better companies regarding disclosure.

The allusion of ownership does have some degree of legislative imperative to the degree of sharing profits on participating policies--but then again a public company could choose to issue participating life insurance and be bound by the same laws to share profits from the block of business. Beyond this, however, ownership is largely a myth.

 

[scagnt83]

https://www.bostonglobe.com/busines...le-scrutiny/Ey4KCvQRrmpIkWllj9wUwN/story.html

I've long complained that life insurers in general can be a tad dodgy on the financial data and some of the mutuals have been among the most egregious violators.

Oddly enough I've always found MassMutual to be one of the better companies regarding disclosure.

The allusion of ownership does have some degree of legislative imperative to the degree of sharing profits on participating policies--but then again a public company could choose to issue participating life insurance and be bound by the same laws to share profits from the block of business. Beyond this, however, ownership is largely a myth.

I would disagree to an extent. A single policy earns you a single vote for the Board Members. 2 policies earns you 2 votes. perhaps a more equitable way would be to base it on premium. But a large hedge fund could certainly buy up a large block of policies and have a controlling vote, just like they do for public companies.

A single policy holder can make just as much difference as a person who owns a single share of stock. It is not very equitable, but it is still participating in the management of the carrier. The biggest problem is the lack of involvement of these policyholders. I bet if 5k of them showed up at the annual meeting, all with the same concern, then they would get somewhere.

But exactly what concerns do you have with one of the highest rated financial companies in the US that pays one of the highest dividends to policy holders??

Now that Liberty Mutual meeting would be the place to raise hell...

 

[UW Guy]

https://www.bostonglobe.com/busines...le-scrutiny/Ey4KCvQRrmpIkWllj9wUwN/story.html

I've long complained that life insurers in general can be a tad dodgy on the financial data and some of the mutuals have been among the most egregious violators.

Oddly enough I've always found MassMutual to be one of the better companies regarding disclosure.

The allusion of ownership does have some degree of legislative imperative to the degree of sharing profits on participating policies--but then again a public company could choose to issue participating life insurance and be bound by the same laws to share profits from the block of business. Beyond this, however, ownership is largely a myth.

I surprised the Globe went after two top end companies in their own backyard. And $35M along with maintaining a "fleet" of four aircraft? Not exactly the stuff Enron or Tyco were made of.

 

[Glassesdude]

Best comment on the article..."Why is it if a person runs a huge company well and gets paid millions its criminal but if a person hits a ball or puts it through a net and gets paid millions no one has an issue?"

 

[Cash]

These business articles are so predictable. The answer to all our problems is more regulation.

Good job on getting quoted though.

 

[L5tc]

Good article. New York Life and Northwestern Mutual agents in particular shove the mutuality stuff when presenting to clients or in cases where they are in competition. New York Life's Trainers and managers will tell their new agents, I was one of 'em, to say that they can pay claims better than a non mutual competitor.

The ability of the mutual's not to have to disclose is not always the greatest thing. It's really to balance that argument. I believe in the strength of The mutual whole life companies as a general thought.

 

[Cash]

Good article. New York Life and Northwestern Mutual agents in particular shove the mutuality stuff when presenting to clients or in cases where they are in competition. New York Life's Trainers and managers will tell their new agents, I was one of 'em, to say that they can pay claims better than a non mutual competitor.

The ability of the mutual's not to have to disclose is not always the greatest thing. It's really to balance that argument. I believe in the strength of The mutual whole life companies as a general thought.

It amazes me how NWM and NYL guys sell their company instead of just selling what the product can do.

Mass Mutual's head quarters look pretty sweet though.

 

[L5tc]

I hated being at NY Life but I'm sure that tactic works. And they can never sell price on their term. So... That's why they tell you infer as much as you can that they'll pay a DB when someone else wouldn't. Sy Sternberg said it, not just the Dickensian sales managers.

 

[BNTRS]

People who work in the media tend to be over zealous about disclosure.

I'm in agreement about the mutuals being extremely stable and unlikely containing any real juicy financial mismanagement stories.

Speaking of compensation for the CEO and MassMutual specifically, the Globe did neglect to mention the rather sharp decline in earnings Roger Crandall had last year when Mass reported a net loss due to capital losses booked over the Hartford acquisition.