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Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The Guardian Life Insurance Company of America (Guardian)

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Presentation on theme: "Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The Guardian Life Insurance Company of America (Guardian)"— Presentation transcript:

1 Dividend Interest Rate Comparisons Prepared by Individual Life Product Development and Support The Guardian Life Insurance Company of America (Guardian) New York, NY December

2 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 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

3 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Notes on Dividend Interest Rates & Histories Dividends are not guaranteed and are declared annually subject to Board approval for all mutual carriers –Guardians 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 –Guardians 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 The slides that follow illustrate the DIR histories for policies issued prior to March Source: Information contained on all slides obtained from Full Disclosure and other company publications.

4 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Historic 30 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 30 Year Average: Guardian 8.98% Northwestern 8.69% MassMutual* 9.10% New York Life 8.67% *MassMutuals dividend history applies to policies issued prior to March, 1996

5 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. NML Historic 30 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 30 Year Average: Guardian 8.98% Northwestern 8.69%

6 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. MassMutual Historic 30 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 30 Year Average: Guardian 8.98% MassMutual* 9.10% *MassMutuals dividend history applies to policies issued prior to March, 1996.

7 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. NYL Historic 30 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 30 Year Average: Guardian 8.98% New York Life 8.67%

8 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Historic 25 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 25 Year Average: Guardian 8.42% Northwestern 8.28% MassMutual* 8.52% New York Life 7.96% *MassMutuals dividend history applies to policies issued prior to March, 1996

9 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. NML Historic 25 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 25 Year Average: Guardian 8.42% Northwestern 8.28%

10 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. MassMutual Historic 25 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 25 Year Average: Guardian 8.42% MassMutual* 8.52% *MassMutuals dividend history applies to policies issued prior to March, 1996.

11 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Guardian vs. NYL Historic 25 Year DIR Comparison Over Time the Dividend Interest Rate is Similar Because the Asset Allocation is Similar 25 Year Average: Guardian 8.42% New York Life 7.96%

12 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY 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 Average: Guardian 7.76% Penn Mutual 7.20%

13 The Guardian Life Insurance Company of America, 7 Hanover Square, New York, NY Questions Please call Life Product Services – Option


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