Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The...
13
Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The Guardian Life Insurance Company of America (Guardian) New York, NY 10004 December 2011 2011-12895
-
Upload
angel-butler -
Category
Documents
-
view
216 -
download
2
Transcript of Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The...
Dividend Interest Rate Comparisons
Prepared byIndividual Life Product Development and Support
The Guardian Life Insurance Company of America (Guardian)New York, NY 10004
December 2011
2011-12895
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100042
Notes on Dividend Interest Rates & Histories
• The Dividend Interest Rate (or DIR) is just one component of a three factor dividend formula that for all mutual carriers includes:
– Mortality: to the extent mortality experience is better than guaranteed expectations, the dividend will be positively impacted
– Expenses: expense results are reviewed annually and compared to pricing expectations to determine the amount of expense loading assumed in the dividend
– Dividend Interest Rate: to the extent the investment experience of the company is better than the guaranteed interest rate assumed in pricing (generally 4%), the excess interest earnings are included
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100043
Notes on Dividend Interest Rates & Histories
• Dividends are not guaranteed and are declared annually subject to Board approval for all mutual carriers– Guardian’s Board of Directors has approved a dividend in every year since
1868
• The DIR alone will not always indicate which policy will perform better
• Compare policy cash value and death benefit internal rate of returns for a better indication of policies’ relative performance– Guardian’s whole life policies are among the most competitive based on
carriers’ 2012 dividend scales
• MassMutual has two separate dividend scales. One is for policies issued prior to March 1996 and another for policies issued since March 1996. The slides that follow illustrate the DIR histories for policies issued prior to March 1996.
Source: Information contained on all slides obtained from Full Disclosure and other company publications.
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100044
Historic 30 Year DIR Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
30 Year Dividend Interest Rate History 1983 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian Northwestern MassMutual* New York Life
30 Year Average: Guardian 8.98% Northwestern 8.69% MassMutual* 9.10% New York Life 8.67%
*MassMutual’s dividend history applies to policies issued prior to March, 1996
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100045
Guardian vs. NMLHistoric 30 Year DIR
Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
30 Year Dividend Interest Rate History 1983 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian Northwestern
30 Year Average: Guardian 8.98% Northwestern 8.69%
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100046
Guardian vs. MassMutualHistoric 30 Year DIR
ComparisonOver Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
30Year Dividend Interest Rate History 1983 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
MassMutual Guardian
30 Year Average: Guardian 8.98% MassMutual* 9.10%
*MassMutual’s dividend history applies to policies issued prior to March, 1996.
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100047
Guardian vs. NYL Historic 30 Year DIR
Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
30 Year Dividend Interest Rate History 1983 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian New York Life
30 Year Average: Guardian 8.98% New York Life 8.67%
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100048
Historic 25 Year DIR Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
25 Year Dividend Interest Rate History 1988 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian Northwestern MassMutual* New York Life
25 Year Average: Guardian 8.42% Northwestern 8.28% MassMutual* 8.52% New York Life 7.96%
*MassMutual’s dividend history applies to policies issued prior to March, 1996
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 100049
Guardian vs. NMLHistoric 25 Year DIR
Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
25 Year Dividend Interest Rate History 1988 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian Northwestern
25 Year Average: Guardian 8.42% Northwestern 8.28%
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 1000410
Guardian vs. MassMutualHistoric 25 Year DIR
ComparisonOver Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
25 Year Dividend Interest Rate History 1988 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
MassMutual Guardian
25 Year Average: Guardian 8.42% MassMutual* 8.52%
*MassMutual’s dividend history applies to policies issued prior to March, 1996.
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 1000411
Guardian vs. NYL Historic 25 Year DIR
Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
25 Year Dividend Interest Rate History 1988 - 2012
4.00
6.00
8.00
10.00
12.00
14.00
1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Guardian New York Life
25 Year Average: Guardian 8.42% New York Life 7.96%
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 1000412
Guardian vs. Penn Mutual Historic 20 Year DIR
Comparison
Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar
20 Year Dividend Interest Rate History 1993 - 2012
4.00
6.00
8.00
10.00
12.00
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Guardian Penn Mutual
20 Year Average: Guardian 7.76% Penn Mutual 7.20%
The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 1000413
Questions
• Please call Life Product Services– 800-871-7780 Option 2.
2011-12895
