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In Reply to: nml in trouble posted by TVO on August 19, 2001 at 13:50:04:
Where have you found such information TVO? I have had some interest in NML for roughly 6 months, and I'm wondering about this info?
When computing one's return on your WL contract it computes to a return of 8.8% over a period of time (not shorter than 10-15 years). I must say, though, they're one of the most financially sound insurers. When the bought Frank Russell, an outlay of stock and cash, they also paid record dividends that year. On top of that, 20% of the dividends paid out in this country are represented by NML.
Not to mention, they also received second place, just below USAA in rankings for life insurance companies.
Yet, you are right about the contract, it is weighted toward life insurance. In fact, if you're not selling enough life policies, they can and will let you go. If you meet the minimums, then you're on your way to making buko bucks. I personally think they'd be better off if they didn't weight the sales so much to insurance, but instead worked on a balance of both.
Whether they're ACL is UL, I don't know. I'm not wholly familiar with UL, but I do know about ACL. I also know they wanted nothing to do with the UL market place, even back in the early 80's, because the products were just not created right. Agents during that time were getting slaughtered by people searching for higher returns from UL's. Eventually, companies that offered UL filed for Chapter 7.
Much of the pricing, as far as NML is concerned, is due to their strategic positioning. They don't take unnecessary risks. Their products are priced for the high-end CEO market, of which 30% of the countries CEO's are clients. They believe in pricing the product right, so as to be financially sound, not price competitive. This way they have adequate reserves for claims, but still can pay huge dividends.
As they have been around for nearly 150 years, I doubt they're going anywhere. In fact, they're growing. They're adding a trust department or legal arm. Also, they've sold off some of their position in Baird and begun consolidation with NMIS. All of this has been done to position themselves better in the financial services industry.
What has got me, though, is many agents grab the title CFP and so on, when many focus solely on life insurance. Now, they're products are very good and very secure, as well as providing one of the best returns, but I also enjoy the investment side of things, so I don't understand the need to push so much insurance.
Looking forward to your reply.