New York Life Company Review
New York Life is currently the largest mutual life insurance company in the world. It has long been regarded as one of the financially strongest insurers and regularly receives top ratings from all four major financial analysis firms. Media reports indicate that it is only one of three major insurers to get the highest possible ratings from the Big Four ratings agencies.
The company started operating in 1845 as the Nautilus Life Insurance Company and changed its name to the New York Life Insurance Company in 1849. It pioneered guaranteed cash value policies with a no forfeiture option starting in 1860. The insurer was also one of the first to start paying dividends to policy holders.
In recent years, New York Life maintained its stability through the financial meltdown in 2008. The firm's management had become concerned about the erratic behavior of the markets in early 2007 and moved its funds out of them before the crisis began. As a result, New York Life did not participate in the TARP, the federal government's bailout program for the financial industry. It has also avoided the purchase of subsidiaries and assets of the failed insurance giant AIG.
New York Life Financial Strength Ratings
One of New York Life's claims to fame is that it holds the highest possible ratings from the four major ratings firms. The company is also to be commended for posting full analyses from these organizations on its website.
A.M. Best gave New York Life a financial strength rating of A++ on June 10, 2010. This is the highest rating that A.M. Best bestows on insurers. Best's analysts praised New York Life's conservative investment style, mutual business model, and effective sales operations, although some criticism was levied for its investments in commercial mortgages which expose the firm to real estate market risks. Best gave the same ratings to New York Life and its subsidiaries.
After giving the insurer their highest rating of Aa2, Moody's analysts rated New York Life's financial strength at Aaa on July 7, 2010. The experts also upgraded the insurer's long term outlook from negative to stable. They noted that the company was not vulnerable to market conditions because of its investing strategy.
The most recent rating is from Fitch which gave New York Life an AAA on Jan. 6, 2011. In a press release, Fitch stated that the insurer received the highest insurer financial strength ratings it can give. Fitch's experts praised the company's "strong capital and well diversified portfolio." The analysts noted that the company would only be vulnerable if economic conditions changed greatly or the management team changed direction. New York Life also received an insurer default rating of AA+ from Fitch which means that the chances of it defaulting are extremely low.
Standard & Poor's or S&P also gave New York Life an AAA rating and moved its credit rating from negative to stable on May 12, 2010. In a report published on Aug. 17, 2010. S&P's analysts praised the company's financial flexibility, strong and comprehensive risk management, and strong pretax earnings. The only potential problem the insurer could face would be an extreme situation such as a total economic collapse, S&P examiners noted.
New York Life Annuities
Like other insurers, New York Life divides its annuities into two categories: "Guaranteed Lifetime Income" and "Investment."
Guaranteed Lifetime Income simply refers to immediate annuities. These are very basic products which contain a guaranteed lifetime income feature. Full details of these products can only be ascertained by contacting one of the company's agents. The immediate annuities might be a good deal for retirees who have a lot of cash on hand.
The company's investment annuities are probably a better choice for the average investor. All of the products offered here appear to be fairly straightforward deferred plans. Both fixed interest and variable versions of these are available. Brochures, comparison product comparison cards, and fact sheets about individual products can be downloaded from the site. Indexed annuities are not available.
New York Life looks is a good place to look for a basic annuity with strong features. Their variable plans come with low fees and the ability to withdraw about 10% of the products gains without incurring a fee. Investment in these plans through a variety of retirement savings vehicles is also available.
Life Insurance from New York Life
New York Life offers a good basic selection of life policies with quite a few options. Its website lists four different term life options alone. A good deal is the Yearly Convertible Term Life policy, offering basic life coverage with the possibility of upgrading to whole life or better every year. It's a good deal for small business people and those with uncertain economic prospects.
Another good deal is the Family Protection policy that can be converted into a permanent policy. This gives an average family a maximum of $2 million in coverage for each parent and $10,000 per child.
Universal, whole and variable policies are also available. One of the best universal policies mentioned on the company's website is the Asset Protector. This provides a tax-free death benefit and tax-deferred income accumulation.
New York Life is to be commended for concentrating on what it does best: life insurance and keeping out of other areas of business such as retirement planning. This company would be best for a person seeking a good basic life insurance policy or annuity. It is secure and its products will be around for many years to come.