Mutual of Omaha was upgraded by Moody’s from Aa3 to A1. No other changes of note this month.
Other news notes:
· Moody’s Investor Service offered mixed comments on the industry indicating financial flexibility and access to capital markets remains strong but market volatility could hurt variable product sales and companies are reaching for yields in somewhat riskier assets.
· From our perspective the most critical issue the industry faces is the likelihood of extended low interest rates where policy guarantees restrict the company’s ability to achieve target spreads. Bernanke’s comments about maintaining low rates for the next two years are particularly troubling if that is the reality we face.
· The Congressional Budget Office announced that the Social Security Disability Income Fund may run out of money as early as 2017, further highlighting our fiscal crisis in this country. Relying on Social Security to handle issues arising from a disability is not an adequate planning approach!
· To add fuel to the debate about whether our tax code needs revision – The Institute for Policy Studies issued a list of 25 companies where the CEO took home more pay than the company paid in corporate income taxes. These companies were described as “hyperactive tax-dodging” corporations. If you want the list just send me a note.
We continue to remain engaged in assisting our clients sort through decision and management processes related to their life insurance assets. If you need an objective, informed opinion please give us a call at 205.414.9955 – we will be glad to discuss how we might be able to help.