Increased assets and introduction of new products lead to strong year
2007 was a strong year financially and fraternally for Rock Island-based Modern Woodmen of America, according to recently released results for the year ending Dec. 31, 2007.
Highlights of the year include:
- Assets surpassed $8 billion.
- More than a half billion dollars was returned to members through life insurance and annuity benefits paid.
- Newly introduced term life insurance portfolio led to an increase of 5.4 percent in the amount of life insurance issued.
- Fraternal expenditures contributed $21 million to support programs in member communities nationwide.
“After 125 years, Modern Woodmen is still strong,” said W. Kenny Massey, president and CEO of the fraternal financial services organization. “The 2007 results show that Modern Woodmen continues to protect members and provide for their financial futures.”
Assets surpassed $8 billion
Modern Woodmen’s assets increased 4.9 percent over 2006, reaching $8.3 billion. Assets are primarily invested in high-quality, low-risk corporate and government bonds. Strong investment income contributed to growth in assets.
Life insurance in force, the total amount of life insurance owned by members to protect their families in case of premature death, increased 2.7 percent to $33.1 billion.
Modern Woodmen also had $4.2 billion of annuity assets under management to help provide members with additional funds and income during retirement.
Total life insurance and annuity certificate reserves, which are funds held to guarantee future benefits to members, increased 3.6 percent to $6.6 billion.
Surplus allows for growth
Net gain from operations after dividends increased to $66.5 million. Net gain from operations adds to surplus, enhancing Modern Woodmen’s strength and stability.
Total surplus and special reserves increased 10.1 percent over 2006, reaching $1.2 billion. Surplus and special reserves provide additional safety for members and ensure Modern Woodmen’s ability to meet unforeseen contingencies, continue the organization’s fraternal programs and provide funds for future growth.
Modern Woodmen’s solvency ratio of 116.38 percent means that for every $100 of liabilities (promises made to members), Modern Woodmen has $116.38 of assets to back up those promises.
Payments and benefits to members in 2007 increased 13.8 percent and included:
- $564.2 million in life insurance and annuity certificate benefits, including death benefits, annuity payments and surrender benefits
- $67.1 million in dividend payments and excess interest paid into life insurance and annuity certificates
A.M. Best affirms Modern Woodmen’s A+ rating
A.M. Best, an independent insurance industry rating agency, recently affirmed Modern Woodmen’s financial stability, security and management performance Superior or A+, which is the second highest of 15 ratings.
New term life insurance portfolio embraced by members
Modern Woodmen’s shift to the 2001 Commissioners Standard Ordinary (CSO) mortality table for its life insurance products began with the introduction of a new term life insurance portfolio in 2007.
The Maximizer Term Life Insurance product provides stronger guarantees and longer level premium periods than previous term products. The new product introduction led to an increase in adult term insurance sales in 2007.
The juvenile term life insurance portfolio was replaced by two products – Junior Max (coverage to age 18) and Step One (coverage to age 30). These products offer longer coverage periods, additional conversion options and simplified premium structures. The insurance sold to this market more than doubled in 2007 as a result of the introduction of these new products.
“The new term life insurance products display our continuing commitment to members,” said Massey. “They allow members to better protect their loved ones at any age and at an affordable price.”
Overall, the new portfolio led to an increase of 5.4 percent in the amount of life insurance issued in 2007.
Fraternal programs support members’ communities
Modern Woodmen has a nationwide membership of more than 761,000. Fraternal expenditures supporting Modern Woodmen’s family-oriented member benefits and programs totaled $21.65 million, including general expenses and taxes. These benefits and programs include disaster relief assistance, college scholarships, a tree-planting program, social and volunteer service programs by adult and youth member chapters nationwide, and educational programs for schools and youth groups.
Key fraternal results included:
- 21,657 activities were conducted by camps (chapters) across the country.
- 302,582 hours of volunteer service were recorded by youth service club members.
- 1.5 million children were served through Modern Woodmen Youth Educational Programs.
- $6.5 million was contributed through Modern Woodmen’s Matching Fund Program to meet needs in member communities across the country. The fundraising projects, matched by Modern Woodmen’s home office, were conducted by the organization’s 2,418 adult camps and 751 youth service clubs.
Founded in 1883 as a fraternal benefit society, Modern Woodmen of America celebrates 125 years of serving members and their communities. The organization offers financial services and fraternal member benefits to individuals and families throughout the United States.
For additional information, contact Kim Woodward; (309) 793-5660