For decades, Midland National Life Insurance Company, has stood out as one the premier insurers for General Agents to represent. Due to recent economic financial fluctuations, revisiting Midland National Life in this report is critical.
1906 was when history began for Midland National Life Insurance Company. This company aspires to the values of integrity, openness, respect, and accountability. Unfortunately, in the last few years robust selling of fixed-indexed annuity plans drove rapid net premium growth beyond initial expectations. Attempting to change from a well-known General Agents Insurance Company to a GA and brokerage combination insurer resulted in early great results, then leading to questionable financial stability.
Midland National Life Insurance Company was purchased 1n 1958 by C.A. Sammons & Associates of Dallas. Charles Sammons already was the president of Reserve Life and owned eight life insurance companies. Today the two key subsidiaries of the Sammons Financial Group of Chicago are Midland National and NACOLAH, North American Company for Life and Health Insurance. Actually, they are similar companies looking at the annuity brokerage, General Agents, and PPGA's, personal producing general agents. A General Agent often has insurance agents under his contract, while a PPGA tends to work independently. Over them is a District Sales Manager and/or a Regional Sales Manager reporting direct to the company.
General Agents are drawn to the insurer because of three main factors. First there was a non pressure General Agent contract that also allowed doing business with other providers. Next is the very strong line of marketable Universal Life and Term insurance policies, along with a diverse portfolio. Third, the commissions paid to GA's and PPGA's were very competitive and favorable. In addition, it was easy to receive a home office response to any question or difficulty that occurred.
Midland National Life Insurance operates in 49 states, DC, military bases, etc. The life operations are all handled out of Sioux Falls, SD with annuity activities headquartered in W Des Moines, IA. Very unique is that the company ownership is privately held with employee shareholders. The high amount of liquidity holdings might be key assets during these crucial times.
Using distinct channels of distribution Midland and North American Company for Life and Health Insurance decided to belong strongly involved in singing up brokers to sell its fixed indexed annuity products. Something now both insurers would like to report that they never were successful at selling. Having considerable risk concentrated in large fixed income investments of a security nature was clearly being in the wrong market at the wrong time.
Thanks to strong product diversification and significant liquidity before the financial bomb struck, Midland National Life Insurance Company should pull itself thru. The lowering of its ratings does not help induce confidence in the insurer. The shame is that this great General Agent insurance company is taking a huge hit because of an unwise brokerage decision. My prediction is that there is a future ahead for them, at first dim and gradually returning to very bright. Next time they are revisited the situation will definitely be changed.