Insurance Dividends

Insurance Dividend

An annual fee an insurance company pays to whole life policyholders. The amount of the dividend is determined by the company's board of directors and is not guaranteed. This allows whole life policyholders access to at least part of their benefit before death. The insurance dividend can be taken in cash, but is almost always applied as a discount against future premium payments. This is a distinct advantage of whole life policies, though some analysts believe that insurance dividends do not make up for the expense of whole life insurance compared to term insurance.

Insurance Dividends

Amounts paid to policy holders are not dividends on capital stock, but are a rebate of a portion of the premiums paid for the insurance. Such dividends reduce the cost of the insurance and are not taxable unless in excess of the total premiums paid. Interest paid when the dividends are left with the insurance company is reported to the taxpayer as interest and is taxable.
References in periodicals archive ?
With its 2015 dividend payout, the company expects to again lead the industry in total life and disability insurance dividends paid.
SNL Financial: Expects to pay nearly $5 billion in permanent life insurance dividends in 2012, more than the next two competitors combined.
The February change was boosted by farm subsidy payments and by a speedup of life insurance dividends to veterans (included in transfer payments).
Northwestern Mutual is the industry leader in life insurance, disability insurance and long-term care insurance dividends paid to participating policyowners.
2 billion payout includes approximately three times the ordinary life insurance dividends of its nearest competitor.
The company just announced plans to pay nearly $5 billion in dividends to its policyowners in 2012, more than double the ordinary life insurance dividends of its nearest competitor and the second-largest payout in the company's history.
Consistently paid the highest total life insurance dividends in the industry.
The company's total dividend payments are expected to exceed $5 billion in 2013 - the most in the company's history and approximately three times the ordinary life insurance dividends of its nearest competitor.
Northwestern Mutual said it expects again to lead the insurance industry by a wide margin in total life insurance, long-term care and disability insurance dividends paid.
insurance industry by a wide margin in total life, disability income and long-term care insurance dividends paid.
The Northwestern Mutual Life Insurance Company - Milwaukee, WI (Northwestern Mutual) - the industry leader in total individual life insurance, long-term care insurance, and disability insurance dividends paid to participating policyowners - has helped clients achieve financial security for more than 150 years.

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