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john Hancock is a merchant, and he had four kids who died

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Q: Does john Hancock life or pacific mutual life or any other companies issue non direct life insurance policies?
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A mutual life insurance company is an entity controlled by the owners of the participating (dividend paying) policies in force in that company. These are usually whole life policies. The dividends come from the companies divisible surplus. It is apportioned through complex formulae that take into account the profitability of the various series of policies in force. Factors such as better than expected mortality results, higher earnings than anticipated and savings in expenses are passed along in the form of policy dividends. Since mutual companies have no stockholders, there is no one other than the policy owners to assume the risks involved in running the company. Traditionally, mutual companies' policies have higher premiums than non-dividend paying policies from stock holder owned companies. The dividends are therefore, a return of an excess premium charge and are not dividends in the traditional sense. Most mutual life insurance companies (Prudential, MetLife, Equitable, John Hancock) converted to stock companies in the 1990s in order to better access capital markets. Others (Pacific Life, Mutual Trust) took the intermediate step of becoming mutual holding companies (MHC). The mutual company created a stock subsidiary to offer policies to the public and to conduct other related business. The stock subsidiary is wholly owned by the parent mutual company even though the mutual company no longer actively operates as a life insurance company. The policyholders of the mutual company are issued stock in the new company, or are given a cash payment that represents their share of the divisible surplus of the company. The insurance policies remain inforce for the same amount of coverage and the same premium payment. Dividends are still paid on the participating policies. Some times, the new MHC acts like a traditional mutual company emphasizing dividend paying whole life policies. In other examples, the new MHC acts more like a stock company in its product offerings, but still tend to pass along improvements to policy owners.


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