Romucon.com
For many years, companies selling participating life insurance policies (where policyholders participate in profits of the insurer that are not otherwise needed to run the operation or bolster financial reserves) could point with great pride to the fact that their dividend scales increased over the years and delivered substantial value to life insurance policyholders who continued to maintain those policies.
But a new wisdom has presumed itself on the industry today, namely, the notion that the only way for a life insurance company to survive among highly competitive financial services peers is to have access to outside capital and become part of the food chain, wherein some will eat and others will be eaten. With the first demutualizations occurring only since the inflation/interest spike of the late 1970s and early '80s, there is not yet much evidence to suggest which business organization format will continue to deliver the most value.
At the same time, however, there is an expectation that a life insurance company run for and on behalf of its policyholders is likely to make decisions that are more focused on its policy owners than those insurers whose first obligation is their shareholders. It is not technically mutual; it is operated for the benefit of its policyholders.
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