Friday at last -

Today's installment of The Rant is the last dedicated to pure product discussion as there are many other things that I want to get off my chest in the coming weeks that are way, way more fun to talk about.

Big point in today's discussion is that the "flight to quality/safety" that the economy has inspired has lead to a dramatic uptick in Whole Life Sales in both Career and Brokerage channels.  

With this trend comes the inevitable "my dividend is better than yours".  Frankly, I don't think that dividend histories are really all that relevant in and of themselves.  In the past two weeks, I have seen two separate pieces from two separate WL carriers showing that their product is demonstrably superior to all others.  Ironically, they both dealt with a 45 year old male, preferred non-smoker, so color me confused by this apparent contradiction.

So what are we to do with this?  As with everything else we talk about here, lets question the source of the data a bit, and apply some common sense.  Obviously these carriers are trotting out examples that favor them.  Can't blame them for that, frankly.  The problem lies in drawing conclusions from such a case specific analysis.

What we can do is notice some trends.  Consider these tidbits buried in one of the previously mentioned pieces from a large Mutual Insurance Company:

• Every carrier included (11 in total) experienced a decrease in projected versus actual IRR on cash value over the period from 1990 to 2010 as a result of a reduced dividend scale
  
• That decrease ranged from 17% to as much as 60%!
• Although not included in the analysis, I am certain there was a commensurate drop in IRR on death benefit.
  
• All these clients are PISSED!  At least they should be.