By Arthur D. Postal
WASHINGTON – New York Life earnings hit $2 billion for the first time in its history, marking the fifth consecutive year in which the company’s earnings reached record highs.
In releasing its 2014 earnings, New York Life reported a 14.7 percent increase in operating earnings for the year despite the low interest rate environment that has dampened profits on the entire financial services industry.
New York Life also said that individual life insurance in force rose to a record $871 billion. This was $31 billion more than the amount in force in 2013.
Among other highlights, New York Life announced it hired 3,680 full-time agents last year. The amount of new hires was significant in light of the overall decline in head count among life insurance agents over the past decade or more. New York Life has been bucking that trend, having grown its active agent force by 24 percent since 2007.
Slightly more than half of New York Life’s new agent hires in 2014 (52 percent) were individuals who represent the cultural markets.
New York Life said operating earnings grew to a record $2.02 billion in 2014, and surplus and asset valuation reserves also hit a record, reaching $21.9 billion for the year.
“Despite continued low interest rates, competition from a strong stock market, and low growth in the life insurance market nationally, New York Life exceeded $2 billion in earnings for the first time and reached a new high in surplus and asset valuation reserve, a key measure of our financial strength,” said Ted Mathas, New York Life chairman and CEO.
Mathas also reported that New York Life continued to lead the industry in providing guaranteed lifetime income, with a 22 percent market share in fixed immediate annuities and 42 percent of the market for deferred income annuities.
New York Life’s mutual fund unit, the MainStay funds family, had 2014 sales of $25.9 billion, the second-highest sales number in MainStay’s history.
Other highlights include:
-Surplus and asset valuation reserve grew by $796 million to $21.9 billion.
- Assets under management increased to a new high of $541 billion in 2014.
- Dividends grew by more than 9 percent for the third consecutive year.
-Policyholder benefits and dividends paid rose to $9.08 billion, up 5 percent.
In his comments, Mathas reiterated that New York Life will remain a mutual insurer.
“Through our mutual company model, we are able to allocate resources in a way few other companies can,” he said.
“The fact that we achieved record earnings while maintaining our strong surplus and unsurpassed financial strength ratings from all four major ratings agencies proves our ability to profitably manage the business to the benefit of our policyholders,” he said. “This we will continue to do.”
New York Life Direct, the company’s direct response business in Tampa, Fla., remains the leading direct marketer of life insurance in the U.S. through an endorsed member benefit program with AARP. New York Life’s group membership association business is the largest underwriter of professional association insurance programs in the U.S., covering members of more than 500 associations across the country.
The carrier also operates an asset management business, which Mathas said ranks among the world’s largest asset management firms. With $526 billion in assets under management as of Dec. 31, 2014, the Investments Group provides investment management services to institutional and retail clients, and delivers annuities and guaranteed products to both the qualified and non-qualified markets
By employing a multi-boutique approach, the investment group continues to produce excellent risk-adjusted performance in managing the vast majority of New York Life’s general account, which stood at $197 billion in cash and invested assets at year end, Mathas said.
InsuranceNewsNet Washington Bureau Chief Arthur D. Postal has covered regulatory and legislative issues for more than 30 years. He can be reached at email@example.com.
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