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SSQ's Dubious Press Releases Target Allstate and John Hancock Structured Settlement Annuitants

by John Darer CLU ChFC MSSC RSP CLTC

Settlement purchasers " in sheep's clothing" trying to reassure you about the safety of your annuities certainly does "arch the brows".

 If there is nothing wrong with Allstate and John Hancock structured annuities (and there isn't) , then why is settlement purchaser SSQ targeting structured settlement annuitants with those companies through nationally syndicated press releases stating that they "..., announced holders of Allstate or John Hancock Life Insurance structured settlements still have help available"?

Adding to the dubious nature of the solicitation, which cannot be shrugged off as playful opportunism, the press release, is issued in the name of the URL for a website, with an address out of Hartford CT, the city and state contained on the Better Business Bureau report seal currently displayed on the SSQ website. The problem, as I see it, is that neither the URL, nor the company name reflected in the BBB report associated with the link, are registered with the Connecticut Secretary of State. Neither was another entity. Structured Settlement Quotes Inc. that was listed in April 2012. so it would difficult for a selling annuitant to be able to easily determine, on its face, the true identity of the entity, in my opinion. 

Ironically a blog published on the SSQ website on February 26, 2013 suggested that the brokerage you choose to sell your structured settlements to is made up of members of the NSSTA. That would seem to eliminate SSQ, wouldn't it?

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Again, if you have a structured settlement annuity or funding agreement with Allstate Life Insurance Company, Allstate Life Insurance Company of New York, John Hancock Life Insurance Company (USA) or John Hancock Life Insurance Company of New York, don't panic, the companies ARE NOT going out of business and will continue to service your accounts.

PostScript The July 2014 issue of Best's Review lists John Hancock as one of the top 5 insurers in USA in terms of year end 2013 assets. The company has maintained an A or better AM Best rating for more than half a century.

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Image Credit Milous Chab/Dreamstime

Structured Settlement Market Consolidation Continues as John Hancock Out

by John Darer® CLU ChFC CSSC RSP CLTC

Another structured annuity issuer is to leave the market.  I heard the rumor last week and that has been backed up by an email today.  John Hancock Life Insurance Company and John Hancock Life Insurance Company of New York will cease writing structured settlement annuities effective March 8, 2013. 

Is the world coming to an end? Not at all.  Consolidation is normal in business markets. It is business as usual, with the exception of the single claimant QSF market, which will effectively be dead.

John Hancock is a major insurer who has just made a business decision to withdraw from a particular line of business. The company is not going out of business and will honor its commitments to existing structured settlement annuitants.

To our friends employed there who are waiting for the shoe to drop, we wish them well as they make their transition

 

 

Life/Health Insurer Assets and Asset Growth Rates for Structured Annuity Issuers

 
by John Darer

The companies that issue structured settlement annuities are among the biggest financial institutions in the United States, if not the world.  Not only are they the biggest but the majority of companies are also growing, according to an A.M.Best survey of the top 100 US Life/Health Writers in terms of 9-month 2010 admitted assets* that was published in the March 2011 Best's Review.  The industry average growth rate was 4.4% while the average for the top 25 was 4.8%**

1. $472.84B  Metropolitan Life & Affilated Companies +8.4%

2. $391.07B  Prudential of America Group  +6.5%

3. $231.25B  Manulife Financial (includes John Hancock Life (USA) and its NY subsidiary) +1.7%

5. $226.33B  Hartford Life Group +2.7%

7. $211.53B  New York Life Group +4.8%

9. $179.91B  AEGON USA Group (Transamerica Life, Peoples Security, Monumental among others)  0.0%

13.$138.99B Mass Mutual Financial Group +4.8%

15.$100.83B Pacific Life Group +3.0%

21.$  69.71B Allstate Financial -5.9%

23.$  63.39B Genworth Insurance Group +0.4%

27.$  46.22B Aviva USA Group +6.6%

39.$  22.92B Symetra Life Group +7.7%

43. $ 18.97B Mutual of Omaha Group +3.9%***

48. $ 16.93B USAA Life Group  +11.6%

57. $ 13.98B Liberty Life Assurance of Boston +7.6%

86. $   3.64B Presidential Life Insurance Company +0.7%

91. $   3.29B Continental Assurance Company

* as of January 7, 2011

Companies listed in bold are current structured annuity issuers.

Note that while American General and United States Life Insurance Company in the City of New York were not listed in the Best's Review survey this author believes their assets would put them in the Top 100 and has requested numbers from the companies.

** by comparison 2003 industry average growth was 12.7%

*** purported to be re-entering the structured settlement market in Q2 2011

 

 

 

 

 

 

Structured Annuity Companies Among "World's Most Admired" 2011 Fortune Magazine

A number of current and former structured settlement annuity companies are listed in the 2011 Fortune World Most Admired list which will be published March 21, 2011. The Fortune World Most Admired list has been  "the definitive report card on corporate reputations" since 1997. The relevance of the survey is that a leader in this survey has been adjudged a leader by its peers.

Most Admired Leaders In the Life and Health Insurance Industry

2  Prudential Finanical

4  MetLife

5  New York Life

6  Massachusetts Mutual

8 Manulife Finanical (former structured annuity issuer in USA and parent of current USA annuity issuers John Hancock Life Insuance Company (USA) and John Hancock Life Insurance Company of New York)

12 AEGON (parent of former structured annuity issuers)

16 Aviva (parent of former annuity issuers)

A number of structured settlement annuity issuers are part of an organization that also writes property and casualty insurance and thus do not appear in the life survey.

In the "P&C" category, Allstate is ranked 9th, Liberty Mutual Insurance Group (parent of structured annuity issuer Liberty Life Assurance of Boston) is ranked 10th, Hartford Financial Services Group (parent of former structured annuity issuer Hartford Life) is ranked 11th and American International Group (parent of current structured annuity issuers American General, United States Life Insurance Company in the City of New York and former issuers VALIC and AIG LIfe) is ranked 16th.

The annual survey draws from the Fortune 1,000 -- the 1,000 largest U.S. companies ranked by revenue; non-U.S. companies in Fortune's Global 500 database with revenue of $10 billion or more; and the top foreign companies operating in the U.S.

The companies are then sorted by industry and with the 15 largest selected for each international industry and the 10 largest for each U.S. industry. A total of 673 companies from 32 countries were surveyed. To create the 57 industry lists, the global management consulting firm Hay Group asked executives, directors, and analysts to rate companies in their own industry on nine criteria, some of which are listed below

• Quality of products and services
• Long-term investment
• Quality of management
• Social responsibility
• People management
• Use of corporate assets
• Innovation
• Global competitiveness

AM Best Report Shows Structured Annuities Issued By Largest Insurers With Long Track Record of Financial Stability

by John Darer® CLU ChFC MSSC RSP CLTC

How stable are the life insurance companies that write structured settlement annuities? 

Top 100 US Life/Health Underwriters (currently or formerly writing structured settlements, ranked by admitted assets

Source: Best's Review July 2009, from insurer annual statements)

1. Metropolitan Life and affiliated companies  $436, 091,585

2. Prudential of America Group  $367,245,599

3. AIG Life Group  $312,735,278

4. Hartford Life Insurance Group $219,495,475

5. Manulife Financial (includes John Hancock) $217,242,055

7. New York Life Group $201,809,229

8  AEGON USA Group  $179,836,971

9. ING USA Life Group $178,478,036

13.MassMutual Finl Group $132,968,358

15. Pacific Life Group  $97,906,637

21. Allstate Financial $74,067,855

22. Genworth Finl Group $63,152,639

27. Aviva USA Group $43,367,009

36. AETNA Inc. $24,263,282

40. Symetra Life Group  $21,281,572

50.  USAA Life Group 15,174,746

59. Liberty Life Assurance Comapny of Boston $12,983,175

86. Presidential Life 3,613,990

91. Continental Assurance Company $3,208,225

Life/Health Insurers Rated A.M. Best  "A" or Better for 50 Years, or better** ( and current rating, number of years A or better)

Source: Best's Review July 2009

Aviva Life and Annuity Company, A,  81 years

Canada Life Assurance Company A+, 61 years

Hartford Life Insuarnce Company A, 60 years

Massachusetts Mutual Life Insurance Company  A++ 61 years

Metropolitan Life Insurance Company  A+ 82 years

New York Life Insurance Company, A++, 82 years

United of Omaha Life Insurance Company A+  54 years

Best's includes a disclaimer with its ratings which states that its Financial Strength Rating is an independent opinion of an insurer's financial strength and ongoing insurance policy based on a comprehensive quantitative and qualitative evaluation of a company's balance sheet strength, operating performance and business profile.

**While not noted by A.M. Best in the July 2009 report,  Symetra Life Insurance Company came about when SAFECO spun off Safeco Life Insurance Company and the company was renamed Symetra Life Insurance Company.  It should be noted by readers that during both the time period that the company was called SAFECO Life Insurance Company and the time after the spin off (when it was renamed Symetra Life Insurance Company),  the company has enjoyed at least an "A" rating from AM Best. The time periods span over 50 years.

John Hancock Announces Organizational Changes

by John Darer CLU ChFC CSSC RSP

John Hancock has announced organizational changes pending regulatory approval

Pending regulatory approval, John Hancock Life Insurance Company (“JHLICO”, which issues structured settlement annuities (and guarantees the payment of periodic payment obligations assigned to John Hancock Assignment) is to be merged into John Hancock Life Insurance Company (U.S.A.) (“JHUSA”). As a result, John Hancock is to withdraw JHLICO’s license to do business in New York.

Under the withdrawal plan approved by the New York Insurance Department, JHUSA will then
assume direct responsibility for the payment of all claims and benefits, and for all other policy
obligations, under in force policies, certificates, or contracts. Servicing will continue without interruption.

All new insurance policies and annuity contracts in New York will be issued by John Hancock Life
Insurance Company of New York or John Hancock Life & Health Insurance Company.

A few bullet points from the John Hancock Q&A

1. Not final yet. It is pending regulatory approval.
2. The withdrawal and realignment is taking place in sequel to the Manulife Financial Corporation acquisition of John Hancock Financial Services, Inc. in 2004.  Despite the integration having been successful, as is often the case in combining large organizations, John Hancock now has an excess of legal entities. As a result, this measure is part of the process of streamlining these entities to better position the company for future growth.
3. We expect the withdrawal and realignment will become effective at the end of the day on December 31, 2009 and your policy, certificate, or contract to be endorsed effective at that time to show John Hancock Life Insurance Company (U.S.A.) as the insurer

Useful reference pieces

New York John Hancock Questions and Answers on Merger

Download NYWithdrawalClientQA

Sample Cover Letter To Be Going Out to John Hancock clients (also presumably to structured settlement annuitants) along with the Q&A

Download Subsidiary Reorganization Cover Letter and Info Sheet

Q2 2009 Financials

John Hancock Life Insurance Company (U.S.A.) and John Hancock Life Insurance Company of New York., as provided by John Hancock

Download JHUSA and JHNY Financials Q2 09

AM Best Rates John Hancock Life A+ (Superior)

by John Darer

AM Best announced today that Manulife and its subsidiaries, which include structured settlement annuity issuer, John Hancock Life Insurance Company have been rated A+ (Superior) with a stable outlook. The company was formerly rated A++.

The AM Best announcement leaves New York Life Insurance Company as the only life insurance company issuing structured settlement annuities through intermediaries that has the highest A.M. Best ratings, in addition to the highest from the other major rating agencies.

The following structured settlement annuity issuers are rated A+ or better by AM Best:

New York Life Insurance Company, New York, NY                   A++XV
John Hancock Life Insurance Company, Boston, MA                A+XV
Metropolitan Life Insurance Company, New York, NY              A+XV
Pacific Life and Annuity Company, Newport Beach, CA            A+XV
The Prudential Insurance Company of America Newark, NJ      A+XV
Allstate Life Insurance Company, Northbrook, IL                     A+XV

In addition to New York Life Insurance Company, former structured settlement annuity issuer Massachusetts Mutual Life Insurance Company retains its A++XV status with A.M. Best.

Structured Annuity Issuers and Assignees Stand The Test Of Time- Best Review July 2009

Best's Review has published "Standing the Test of Time" its annual report of insurance companies that have demonstrated their financial strength for half a century or more. The report published in its July 2009 issue includes both property and casualty as well as life and health insurers. A large number of the companies listed are either current or former annuity issuers or qualified assignees.

Inclusion in this list DOES NOT mean you should throw caution into the wind but it does show that these companies have weathered a variety of different storms during the time period in the opinion of A.M. Best rating agency.

Maintained Rating of A (Excellent) or better for 75 or more years

National Union Fire Insurance Company of Pittsburgh, PA, since 1934, (now part of AIU Holdings, Inc. and for structured settlements entered into for New York claims and suits against insureds of AIG subsidiary American Home Assurance Company it serves as qualified assignee for cases resolved though June 30, 2009).

Aviva Life and Annuity Company (former structured annuity issuer-includes predecessors), since 1929
Genworth Life (includes predecessors), since 1928  (former structured annuity issuer)
John Hancock Life Insurance Company, since 1928
Metropolitan Life Insurance Company, since 1928
New York Life Insurance Company, since 1928
Prudential Insurance Company of America, since 1928

Maintained Rating of A (Excellent) or better for 50 or more years

American General, since 1948
Hartford Life insurance Company, insce 1940
Liberty Life, since 1954
Massachusetts Mutual Life, since 1939 (former structured annuity issuer)
Pacific Life, since 1959
United of Omaha, since 1956  (former structured annuity issuer)

Canada Unveils "Canadian Life Insurers Assurance Facility"

Reuters reports that Canadian Finance Minister Jim Flaherty unveiled details of an assistance facility for the country's life insurers aimed at ensuring the firms have access to the funds they need if credit markets seize up.

The Canadian Life Insurers Assurance Facility is similar to one already available to the Canadian banks and is designed as a backstop to global credit markets, to put Canadian insurers on an equal footing with foreign competitors who are benefiting from guarantee programs provided by their governments (e.g. TARP for US insurers)

Reuters, citing the Canada budget website said that "while Canadian insurers have seen their profits suffer or vanish amid a drop in business and huge investment losses, their balance sheets are relatively solid and the credit facility may never be needed".

The life insurance sector, both in Canada and abroad, has been hurt by weaker financial markets that caused investment losses and higher costs for minimum guarantee variable annuity products that are affected when market values fall.

Under the assistance facility, companies seeking to issue insured debt will be required to enter an agreement with the Canadian government. Ottawa will then offer a guarantee of timely payment for interest and principal payments for the wholesale debt instruments that qualify, and the insurer will pay a market-based fee on the amount of insured debt issued.

A number of life insurers issue structured settlements in Canada in addition to connections to the United States structured settlement market.  Manulife, a Canadian company is the parent of US insurer John Hancock and Canada Life is a former structured settlement annuity issuer.

Long Term Care Insurance Company Ratings Fumble in April 2009 Financial Planning

by John Darer® CLU ChFC CSSC RSP

A fumble "at the goal line" in otherwise very good article on the financial security provided by long term care insurers in the April 2009 Financial Planning magazine (pp 48-53) leaves me scratching my head.

Donald Jay Korn observes that the cost of long term care insurance has been rising and questions whether the companies that offer it are still on solid ground and then misrepresents that out of the top long term insurance companies only John Hancock Life Insurance Company and Massachusetts Mutual Life Insurance Company get the highest grades from the three rating agencies. Korn lists A.M. Best Co., Moody's and Standard & Poors as "the three rating agencies".

Comments:

1. There are more than three rating agencies. Most notably Korn omitted Fitch.
2. While both John Hancock Life and Massachusetts Mutual Life  are top rated by A.M. Best and Standard & Poors they are both rated Aa1 which is a great rating but still the second tier. Moody's "highest grade" is Aaa NOT Aa1.
3. Northwestern Mutual Long Term Care Company, a wholly owned subsidiary of Northwestern Mutual Life Insurance Company, does in fact have the top ratings from the three rating agencies that Donald Jay Korn refers to as well as Fitch Ratings.