The industry’s largest mutual insurers all recently announced their expected 2019 dividend payouts – and all three say the amounts will break their own company records.
Here’s a closer look at what policyowners will receive from Northwestern Mutual, New York Life and MassMutual:
Northwestern Mutual to pay policyowners $5.6 billion in dividends
Northwestern Mutual announced in November that its policyowners will receive an estimated $5.6 billion in dividends through the company’s 2019 dividend payout. This payout is expected to lead the industry and be the highest payout in the company’s history.
The company’s dividend payout record is unparalleled in both duration and size. Northwestern Mutual has paid a dividend every year since 1872 – even in challenging economic conditions. Northwestern Mutual leads the industry in total dividends paid to policyowners for both life and disability income insurance.
“This record dividend clearly demonstrates our consistent performance, our overriding commitment to do what’s best for our policyowners, and our industry-leading ability to deliver long-term value,” said John E. Schlifske, chairman, president and CEO of Northwestern Mutual. “Staying focused on business fundamentals – sound underwriting, disciplined expense management and investment performance – is core to our financial strength in all economic seasons.”
Policyowners who own whole life insurance, disability insurance and some annuity products are eligible for dividends which can be used to advance financial goals, including reducing the cost of premiums; taking dividends in cash; or, for life insurance, increasing the cash value and in many cases death benefit.
For more information, see How We Determine Dividends on northwesternmutual.com.
New York Life approves largest total dividend payout in company history
New York Life, America’s largest mutual life insurer, announced in mid-November that the company expects to pay eligible participating policyowners a record dividend payout of $1.8 billion in 2019. That payout reflects a 1.1% increase from the $1.78 billion 2018 dividend payout total.
This milestone will mark the 165thconsecutive year that New York Life has paid a dividend to policy owners, underscoring the company’s continued financial strength. New York Life is the only major U.S. mutual life insurance company to declare a record dividend payout in each of the last five years, according to a statement released by the company.
According to CEO and Chairman Ted Mathas, “Paying dividends to our eligible policyowners for the 165th consecutive year is New York Life’s mutual structure in action. This unparalleled consistency in sharing our success reflects the disciplined execution of our diversified business strategy and superior financial strength. As a mutual company, our interests are aligned with those of our policyowners, not Wall Street or shareholders, meaning the value we create is carefully managed with their long-term interests in mind.”
The dividend payout declared in 2018 follows an outstanding year of performance. This year also marks the third anniversary of paying dividends on participating Mutual Income Annuities. Income annuities have grown to become a core retirement solution for millions of Americans. New York Life and its subsidiaries remain the income annuity leader according to LIMRA.
With its success driven by the industry’s largest, best-trained, and highest-achieving agent force, the statement says, New York Life remains one of only two life insurance companies in the country with the highest financial strength ratings currently awarded to life insurers by the four major rating agencies, reflecting a level of safety and soundness that is unsurpassed in the industry.
In addition, surplus and asset valuation reserve remain strong at a record $25.1 billion, bolstered by the company’s ability to strategically manage its $252.9 billion general account and successfully operate its portfolio of supporting businesses, which deliver diversified revenue streams to support New York Life’s financial strength.
For more information visit www.newyorklife.com.
MassMutual approves record $1.72 billion estimated 2019 dividend payout
Massachusetts Mutual Life Insurance Company (MassMutual) announced in November that its Board of Directors approved a record $1.72 billion estimated dividend payout in 2019 to eligible participating policyowners and members, once again demonstrating outstanding policyowner value and underscoring its strong financial position.
The all-time high estimated dividend payout represents an increase of more than $125 million over 2018, and marks the 151st consecutive year that MassMutual will be paying a dividend.
Additionally, the 2019 estimated payout reflects a dividend interest rate of 6.40% for eligible participating policies, maintaining the same rate as 2018.
While dividends are not guaranteed, MassMutual has paid them to eligible participating policyowners every year since 1869. In fact, with the 2019 estimated payout, MassMutual will have delivered $14.7 billion in dividends to eligible participating policyowners since 2010.
“MassMutual’s track record of consistently paying an industry-leading dividend is the result of our distinct, diversified strategy, and core to who we are as a mutual company run for the benefit of our participating policyowners and members,” said Roger Crandall, MassMutual Chairman, President and CEO. “Our record estimated dividend payout for 2019 reflects the strength of our operations, the longevity of our success, and ongoing stewardship that has helped generations of people secure their future and protect the ones they love.”
According to a statement released by the company, the 2019 estimated dividend payout reflects improved mortality experience and favorable investment performance, as well as MassMutual’s strategic differentiator – its diverse mix of high-performing businesses, including its institutional and workplace businesses as well as its investments in international insurance and global asset management operations. It also underscores MassMutual’s financial strength, as the company has consistently earned among the highest ratings of any company in any industry.
Over the past decade, MassMutual has delivered on commitments it made to its policyowners and customers by paying more than $35 billion in insurance and annuity benefits – including more than $5 billion in 2017 – and has increased total adjusted capital more than 60% to historic levels of more than $18 billion.
“Our 2019 estimated dividend payout reflects our steadfast commitment to our participating policyowners and members,” said Mike Fanning, head of MassMutual U.S. “Through our dedicated financial professionals and innovative digital tools that meet people on their terms, we are strongly positioned to provide holistic financial solutions to the millions more who need them.”
For more information, visit www.massmutual.com.
I have real issues with the way WL carriers "promote" their Dividends. It is completely misleading and distorts the actual benefit to consumers!!
This article only perpetuates that distortion.
– NYL might be paying more dollars in Dividends vs. previous years…. but their clients receiving a lower % return on their WL policy vs. previous years.
– Mass is exactly the same. Mass clients will see no extra benefit vs. last year.
– NYM is basically the same. Only a 0.1% increase in benefit on their policy vs. last year.
What matters to consumers is the Dividend Rate. Not the dollar amount of Dividends paid.
This is not news… it's propaganda designed to distort the truth and make these carriers seem stronger than they actually are…
Have you heard about Real Wealth Media's FIRST Symposium?? Lots of quality presenters: Tom Hegna, Van E Mueller, David McKnight, and many others! It's April 29 through May 1st, 2019.
What concerns me is that consumers believe this is good news rather than the same tired propaganda. They have no understanding of what this means and can misconstrue it to make decisions what are not in their best interest.
Leaning on the technicality of what "largest ever dividends" means is nothing short of the same misrepresentation too many agents perpetuate in the field. I see it all day long and am called in to clean up the messes. With teachers like this it's no wonder policy owners are being misled. The institutional indoctrination is shameful.
If I had $1,000,000 last year and it grew at 8% to $1,080,000 and this year it grows at 7.5% and I have a press release about the biggest growth ever ($81,000) wouldn't I appropriately be taken to task? Isn't it actually a lie in every meaningful sense?
I'm not anti-whole life. I'm anti-lying. Since there is so much good about life insurance, why the need to resort to these tactics? These are biggest and "best" of insurance carriers and consumers assume regulators are doing their jobs and not allowing these companies to intentionally mislead them.
Anyone who writes to perpetuate these misrepresentations is a part of the problem and should be held accountable.
Just another positive for IUL – better transparency and disclosures (if properly structured).
Couldn't agree more. Cant believe how many agents cant do basic math or understand a big carrier promoting that the pay an 8% dividend doesn't mean CV will grow by 8% at all. on top of that, many of the agents then don't factor in the client is paying the premium & that is also what grew the CV of the current year. an IRR year over year comparison with the premium removed likely is closer to 3.5% to 4.5%. I have no problem with that fact, just a problem with how it is portrayed as something more. Still a great tax diversification play for future income in many cases & comparable to a bond portion of some overall portfolio. just never understood the need to overhype it & then have most agents & consumers not be able to realize the real math.