Deseret News | Reader comments: Beneficial Financial Group cuts 150 of its 214 Utah jobs

Reader comments
Beneficial Financial Group cuts 150 of its 214 Utah jobs

Page:
1
2
Next >

Opinionated | 12:14 p.m. June 16, 2009

My heart goes out to these people and their families. I hope they will all see the open door as this one closes.

MarkC. | 12:28 p.m. June 16, 2009

Does "discontinue writing new policies" mean that current term life policy holders will no longer be able to convert to whole life policies, as promised in their insurance contracts?

TKC | 12:49 p.m. June 16, 2009

Good luck to all those who lost thier jobs! We unemployed are becoming less and less of a minority! There is always comfort in groups ;) Now if we could only start our own company.....

Comments continue below

George | 12:56 p.m. June 16, 2009

What a sad day. Beneficial Life was a name and business we could always take pride in. Good bye old friend.

To MarkC | 1:03 p.m. June 16, 2009

The life insurance contract is just that, a contract, and the company cannot unilaterally change it. While I don't know for certain I would be very surprised if a term policy holder could not convert. The bigger question is why would they want to?

To MarkC #2 | 1:05 p.m. June 16, 2009

In my last submission I did not mean to disaparage whole life policies. I think they are a very good part of a complete financial package. My point was why would someone want a Beneficial whole life policy?

Knowwhat | 1:19 p.m. June 16, 2009

They probably didn't want to and couldn't Take any money from AIG, Goldman Sachs took it all. Nothing like killing a fat hog.

Frank | 1:20 p.m. June 16, 2009

Wow, I just finished signing up with Benificial today.

MarkC | 1:40 p.m. June 16, 2009

Why would someone want a Beneficial whole life policy, or any Beneficial policy at this point? Because Beneficial, even with its downsizing, has the financial backing of Deseret Management and the LDS Church. It is probably more likely to honor its policies and obligations than some larger insurers who may go out of business entirely because of the economic environment. Hopefully , the company plans to address any issues in communications with existing policy holders. Thanks for responding!

Mike | 1:43 p.m. June 16, 2009

Well that's even more people to compete with for finance jobs in the community. It's so competitive right now to find a job it's getting so ridicilous out there. It's getting to the point where it's not even worth trying to look.

leftyjace | 1:44 p.m. June 16, 2009

This is my wife's company. I'm pretty anxious. She still hasn't completely learned the fate of her position.

Wow, I thought.... | 1:51 p.m. June 16, 2009

Wow, I thought that Ben-Life, being part of the LDS inc, would be guided through the tough times by virtue of prophetic insight into future market conditions! I'm bummed!

Sam | 1:53 p.m. June 16, 2009

All of the people with whom I ever associated at Beneficial told me that since Beneficial is owned by the Church, it would survive through the Millennium. Oops.

To MarkC | 1:55 p.m. June 16, 2009

Beneficial has been sold. Bet on it. The LDS Church will not allow continued hemoraging of red ink. Deseret Management is a for profit organization and is run like one. Look at ZCMI, the sugar plantations in Hawaii and other business ventures. It will be the sale that keeps the policy holders whole. That will be how Deseret Management does it.

leftyjace | 2:10 p.m. June 16, 2009

Did you even read the article? They have assets of 3.4 billion. No need to sell it. They can just stay in existence servicing existing policies until the last policy is fulfilled, and then turn over remaining assets to DMC.

Mike | 2:21 p.m. June 16, 2009

I'm bummed too....I'm a recently contracted agent who invested $500-$600 of my own money to go to a new agent training class just three weeks ago. Someone in the upper crust of the company knew what was coming and should not have had 30-35 of us fly out to Salt Lake and know that we couldn't market the product anymore. Ridiculous!

No Sale | 2:22 p.m. June 16, 2009

I would NOT bet on the sale of Beneficial. Trust that the company will, in fact, honor current contracts and commitments -- including conversion of Term policies. I am grateful I own Beneficial Whole Life policies and that it is still backed by the LDS Church!

Love the spin! | 3:16 p.m. June 16, 2009

Ben-life has been competing just fine for 104 years. As a former agent, the TRUTH is this company was mismanaged and got very greedy by investing in sub-prime mortgages and other exotic investments that hurt the investment accounts. You could see this coming over the past few years as VP's and many other high profile people within the company left for better opportunities. Many other poor decisions that affected the agents also hurt as benificial lost some big producers and other top employess because of big ego's and downright poor oversight and management for a insurance company. It's really sad for all those affected by the closing of Beneficial Life

This does not look good | 3:22 p.m. June 16, 2009

Any way you look at it, this is not good for employees, agents, AND policy holders. On Beneficial's web site, in "A Letter to You From the President" Kent Cannon cites strong 2008 sales and operating profits that helped "to further strengthen our capital and surplus." He then writes "we expect 2009 to be another strong year." WRONG! 2009 and beyond will be the weakest in terms of sales and operating profits. And, since the existence of sales and operating profits contribute to capital, I would assume that the lack of sales and profits will detract from capital. This is not good for policy holders, and is the reason rating agencies will downgrade Beneficial even further. I think Kent Cannon should take his letter down ASAP. I would be concerned if I were a policy holder. Unfortunately, there is nothing policy holders can do but hope and pray.

Familiar with Beneficial | 4:20 p.m. June 16, 2009

As someone familiar with Beneficial, I would say some of you are not paying attention and making incorrect assumptions. The company is better capitalized than essentially any other life insurance company out there. They also have the financial backing of the LDS church. The church wouldn't let these policies lapse. The company is closing as stated correctly in this article due the future risk exposure being to high for the potential profits. That is simple business. If you can guarantee a certain rate of return by investing in safe investments, then that is better than risking it on a small insurance company...

irishman | 5:03 p.m. June 16, 2009

I appreciate them letting us know of Ben-Life, yet with $$, plus putting up a new building, why can they not cut the corners of the buildings so to speak, and keep the employees? But, yet they can let them go with a s. package, for six months, and not worry? I agree with TKC who said "There is always comfort in groups ;) Now if we could only start our own company..... "" We need to get together and get the business running. Let's Start the business...

shawilli | 5:10 p.m. June 16, 2009

Mark C. The Mormon Corporate Empire has to face up the fact that churches run along the same lines as any business does, they are in it to make money and that all being tax free they make a very huge amount of it. The Ben Fin Co. was started to add to the church coffers back in 1905 and now some 104 years later it is no longer making fist fulls of money, it is closed.I once thought as a good standing LDS member that I should consider buying a policy, through my fellow ward member who was an agent,I brushed his approaches off and now I know it was the right thing to do.I wonder with all the newspapers going to web pages just how long the D-News will be around? I rather suspect not too many years longer.

Bill in Cedar | 5:13 p.m. June 16, 2009

I've always thought it interesting that Beneficial agents note their affiliation with the LDS church. They are two seperate entities. As stated in the article, Beneficial Life is a "For Profit Company." When you can tell the profits aren't going to be there, it's time to get out. Thank goodness for good solid mutual companies like Northwestern Mutual and New York Life. These companies operate FOR the policy owner, because they are owned by the policy owner. No stock holders here. If you're interested in whole life insurance, check out Northwestern Mutual. They are paying out 1/3 of the whole life dividends on policies for the entire industry. Talk about a financially sound company.

Also very familiar | 5:32 p.m. June 16, 2009

Beneficial attempted to stop its bleeding with the sale of its group operation then needed an infusion of capital from its parent. There are many problems with Beneficial's position as a viable ongoing entity. It's size is first and foremost. It simply, by itself, could not afford its large losses in its investment portfolio much of which was made up of colateralized mortgage obligations. Its ability to compete with the major players is further hampered by its lack of brand recognition. It existed essentially as a fraternal for LDS members. That alone could be enough to support such an organization had it not been for its financial mismanagement and reasonably large stake in the bank owned life insurance marketplace. It tried for a long time to operate as one of the "big boys" with its rented broker dealer and other products that it simply did not have the capacity to produce on its on. Its lack of direction began during economic good times much as the lending industry's did. You have to blame the CEO and the board of directors, but only to the same extent you blame a child for wrecking a car. No experience.

George W | 5:38 p.m. June 16, 2009

Policy holders don't have anything to worry about... their contracts are good and will be honored by ANY company that picks up the assest of the company. I would buy the company in a heart beat... they have good policies, they only have a "distribution" problem where sales are not enough to susstain the company. That can happen to any company!

Fred in Vernal | 5:43 p.m. June 16, 2009

This is just the beginning! We've only begun to see what's ahead! The whole nation and even the church are in for some bad money times!!!

RE: shawilli | 5:45 p.m. June 16, 2009

Please don't post such misinformation about any "for-profit" arm of any religious organization. All the for-profit arms of the LDS Church are taxed like any other corporation out there. They are also subject to government regulations like the Equal Employment Opportunity, and so forth. Only the church's operating funds for religious activity generated by tithes - such as the meetinghouse and temple building program, education, or welfare activities, are tax free. The LDS Church has wholly owned for-profit entities all over the world, and they are taxed and rise and fall just like any other business. The fact that our religious leaders may sit in on board decisions, does not make them free from error or even failure. It is ridiculous to think otherwise. Oh, and I've had a Beneficial term life insurance policy for seven years now... guess I might look elsewhere.

Anonymous | 5:48 p.m. June 16, 2009

Making room for parking ?...................

Or even better condo's............

LOL

Re: Bill in Cedar | 6:16 p.m. June 16, 2009

I would be hesitant to speak so highly of a company like Northwestern Mutual. They certainly project paying high dividend rates, but when they pay out a higher percentage of dividend then what they make on their own portfolio you know something isnt right. Its called trying to buy market share and now and pay for it later. Dont be surprised to see them in trouble down the road. I would not buy a Whole Life policy from Northwestern Mutual.

Larry | 6:22 p.m. June 16, 2009

Northwest Mutual? New York Life, take a good look at your "whole life" policies. The vast majority (from ANY company) will pay EITHER the face value OR the investment, NOT BOTH. Check and see how much your premium is going toward your insurance each year (it climbs like crazy) and will be higher than your premium before you know it, then, they take the difference from your cash value to help pay for the insurance. Anyone who thinks whole life insurance is even worth considering better take a close look at their policy (a close look).

Anonymous | 6:36 p.m. June 16, 2009

Heber J. Grant must be rolling over in his grave.

Professor | 7:02 p.m. June 16, 2009

Do you know how hard it is to go out of business as a life insurance company? It has one of the best business models of any industry. All you have to do is underwrite and apply risk to actuarial tables that are scientifically accurate to three decimal places! It appears Beneficial got too greedy for their own good and made some TERRIBLE investments...

Someone's hiring | 10:18 p.m. June 16, 2009

There's an insurance-type company expanding like crazy right here in Salt Lake, called Extend Health. Maybe the layoffs from Ben Life will find a new home there.

Employees | 11:30 p.m. June 16, 2009

They were all great and always helpful. Wishing them best.

DM | 12:37 a.m. June 17, 2009

Well done Mr. Wiles as you continue your "Chop Shop" economics as practiced at the L.A Times & other previous companies. Why could you not sell the company & keep people in jobs with the provision that your clients policies would be honored?

Kyle | 8:44 a.m. June 17, 2009

What Larry is talking about is not whole life. What he's referring to is universal life. No increasing costs come from the cash value of whole life. In fact, no costs come from the cash value of whole life at all. Whole life is a very simple contract.

I wish all of you well who are losing your job at Beneficial Life. These are tough times. All of my interactions with Beneficial Life staff have been extremely enjoyable and professional.

I would like to say that all of you who own whole life and term policies with Beneficial have a lot less to worry about than those being tempted into putting money into equity based products.

Kyle | 8:49 a.m. June 17, 2009

Larry's comment about whole life is incorrect. There are no "increasing costs" that come from the cash value of whole life. What he's referring to is universal life products (which Larry is right about).

To all of the Beneficial Life employees being laid off, I wish you well. These are tough times. People need what you do now more than ever. So, don't give up finding your next job.

For those individuals holding term and whole life policies with Beneficial, you have a lot less to worry about than the people shoveling money into equity-based products.

Retired Agent | 10:32 a.m. June 17, 2009

Beneficial will be sold within two years. The new owner will honor all contracts and obligations. When an insurance company stops taking in new business they are left with a single pool of policyowners. Healthier policyowners will obtain better insurance products utilizing tax-free rollovers of their money held at Beneficial. Receiving companies will offer premium bonuses to offset surrender charges. Unhealthy, higher risk insureds are stuck with Beneficial. Resulting claims experience will become more and more negative. When a company quits writing business company ratings fall to unacceptable levels. Former agents and other advisors will begin to devour Beneficial's block of business by moving clients to other companies and earn new commissions. The truth is Beneficial Life will be gone forever. Blood is in the water. There's good money to be made for agents who will specialize in replacing Beneficial. Final Note: Beneficial used to be the Noah's ark of the LDS financial community. Policies were sold on the basis of LDS church ownership. Church leaders warned agents not to use the church that way but it was too good of a sales pitch to not use it.

Life Actuary | 11:28 a.m. June 17, 2009

Retired Agent - you must have had a long and prosperous career as a agent. The wisdom you picked up from your lifetime of experiences is very evident. Perhaps if the young hotshots running businesses today had heeded advice from sages such as you, we wouldn't find ourselves in our current predicament.

Retired Agent | 12:53 p.m. June 17, 2009

There are a large number of insurers like Beneficial who are reeling from the subprime crisis,securitized mortgages and derivatives. These derivative investments are hardly understood and obviously very dangerous. There are still tens of trillions of dollars of these investments out there. I'm affraid we haven't seen the worst of their damage. After the economy sunk last November, Bill Clinton said, "I wish I'd done a better job of regulating these derivative investments." The need for regulation has been shunned since Reagan. Most of the big insurance giants got hit with losses. Again, the greed and deceipt on Wall Street is the real culprit. I'm sorry for those affected at Beneficial Life.

Informed | 1:46 p.m. June 17, 2009

Umm, didn't NorthWestern Mutual take a piece of the Bailout stimulus pie from the government? Sounds like trouble to me. NorthWestern paid a 7.5% dividend on their whole life products last year, but only profited 6%. How can a company stay solvent with a 1.5% loss each year. Plus they just bought something like 600 million in gold. Talk about a volatile markets, precious metals have always been a huge risk, over time.

John | 2:52 p.m. June 17, 2009

Amen to "Retired Agents" final note at 10:32 am.

I Like it | 2:54 p.m. June 17, 2009

Kudos to Retired Agent's "Final Note" in his 10:32 am post. That's been my frustration with Beneficial for years.

Re: Informed | 3:03 p.m. June 17, 2009

Northwestern Mutual did not take any bailout money. And because profits were down (but not negative) this year their dividend rate has been cut to 6.5%.

Northwestern also had it's strength ratings confirmed by A.M.Best and Standard and Poor's (yesterday) and was classified as AAA (stable). Even other behemoths of the industry such as New York Life and Mass Mutual were slightly downgraded to AAA(negative) outlooks.

Northwestern's investment portfolio is about 156 billion this year. that means 600 million of gold (if what you say is true) is less than half a percent of their investments. New york life has an even more vast investment portfolio, though their dividends (in dollars) are not as high.

That's how strong a company it is.

Do a little fact checking before you call yourself informed.

Finally: an insurance company that can't stay afloat isn't going to be bought by anybody. It's just going to slowly dwindle to nothing. While I have no doubts it will honor it's death benefit promises, I feel sorry for those who were relying in any way on future cash value growth.

Causality | 3:09 p.m. June 17, 2009

I got to agree with Retired Agent's final note.

Lee | 4:39 p.m. June 17, 2009

Wow, Larry sounds like he's not too bright. The bottom line is it is a sad day. Beneficial has always, always honored it's committments. Kent Cannon is among the best there is and it's just sad for all those involved.

pastagent | 6:14 p.m. June 17, 2009

LOT of incorrect assumtions...even from agents.
Benefical policies have the lowest COST OF INSURANCE COI, in the industry. BL did not write 'unhealthy' clients. I own two whole life policies from them BECAUSE their internal cost were the lowest in the industry, the next is Northwestern. I agree, as a general rule whole life is not a great 'investmnet' but it is a smart purchase. Both of my policies have had 5+% returns over the last 10 years. It would be mathamatically impossible to 'roll over" or 'exchange" my policies for a new policy from another company (except MAYBE NW) and have egual or better internal performance moving forward.
I personally, would buy their book of business in a heart beat. Their average insured lives 7 yrs longer than the industry average. They accurately price smokers unlike other companies who pass the cost across the entire base.

I would agree that they got sized uot. ANd lacked some real Marketing Savy.

Ryan | 12:12 p.m. June 18, 2009

It's funny to me that people think that any permanent life product is a still the way to go...and I know people will say what they will...but I would rather take a 9+% growth in my IRA over the same time period as your 5+% growth in your WL,UL, or VUL. Insurance is just that, insurance...insurance is not an investment tool. You don't "invest" with your auto or home owners insurance...do ya? All the money people...Dave R, Suze O and the rest will tell you that you will end up with much more if you purchase Term and invest the difference outside of a policy. But let's here what you have to say.

poetic justice | 12:32 p.m. June 18, 2009

Boo Hoo! The Financial Services industry is finally getting their come uppance.

Now, they just need to condense some of the firms on Main St downtown. I believe Wells Fargo owns Wachovia so why do they both have buildings on the 200 S block?

Poor Ryan | 1:54 p.m. June 18, 2009

I think you should let everyone know where you have gotten 9% over the past 10 years. In fact, you should tell Beneficial and maybe save them from going out of business. I love the reference to Dave R. and Suze O. who definitely have not made their money by doing IRA's (they are phased out and cannot contribute to IRA's). Before you give financial advice, go get your education and read the contracts!

Page:
1
2
Next >

Add your comment

Comments are monitored. Any comments found to be abusive, offensive, off-topic, misrepresentative, more than 200 words or containing URLs will not be posted.

Words Remaining

E-mail address: For internal use only. We may want to contact you to publish your comment (not your e-mail address) in the newspaper or for a separate story idea.