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National Western Life Insurance Company- Life Insurance -
Category Main Page
(512)
836-1010
850
EAST ANDERSON LANE
AUSTIN, TEXAS 78752-1602
www.nationalwesternlife.com
Sales
$446
million
Business Description
National Western Life Insurance Company (hereinafter referred to as
"National Western", "Company", or "Registrant") is a stock life insurance
company, chartered in the State of Colorado in 1956, and doing business in
forty-nine states, the District of Columbia, and four U.S. territories or
possessions. National Western is also licensed in Haiti, and although not
otherwise licensed, accepts applications from and issues policies to
residents of various countries in Central and South America, the Caribbean,
the Pacific Rim, and Eastern Europe. Such policies are underwritten,
accepted, and issued in the United States upon applications submitted by
independent contractor broker-agents.
Products
National Western offers a broad portfolio of individual whole life,
universal life and term insurance plans, and annuities, including
supplementary riders.
Life Products. The Company's life insurance products provide protection for
the life of the insured and, in some cases, allow for cash value
accumulation. These product offerings include universal life insurance
("UL"), interest-sensitive whole life, and traditional products such as term
life insurance coverage. Interest sensitive products such as UL accept
premiums that are applied to an account value. Deducted from the account
value are cost of insurance charges which vary by age, gender, plan, and
class of insurance, as well as various expense charges. Interest is credited
to account values at an interest rate generally determined in advance and
guaranteed for a policy year at a time, subject to minimum guaranteed rates
specified in the policy contract. A slight variation to this general
interest crediting practice involves equity-indexed universal life ("EIUL")
policies whose credited interest may be tied to an outside index such as the
S&P 500 IndexÒ at the election of the policyholder. These products offer
both flexible and fixed premium modes and provide policyholders with
flexibility in the available coverage, the timing and amount of premium
payments and the amount of the death benefit, provided there are sufficient
policy funds to cover all policy charges for the coming year. Traditional
products generally provide for a fixed death benefit payable in exchange for
regular premium payments.
Annuity Products. Annuity products sold include flexible premium and single
premium deferred annuities, equity-indexed annuities, and single premium
immediate annuities.
The
Company manages its business between Domestic Insurance operations and
International Insurance operations. For segment reporting purposes, the
Company's annuity business, which is predominantly domestic, is separately
identified.
Domestic Insurance Operations. The Company is currently licensed to do
business in all states and the District of Columbia, except for New York.
Products marketed are annuities, universal life insurance, and traditional
life insurance, which includes both term and whole life products. The
majority of domestic sales are the Company's annuities. National Western
markets and distributes its domestic products primarily through independent
marketing organizations ("IMOs"). These IMOs assist the Company in
recruiting, contracting, and managing independent agents. The Company's
agents are independent contractors who are compensated on a commission
basis. At December 31, 2003, the Company's IMO relationships had contracted
nearly 11,100 independent agents with the Company. Over 34% of these
contracted agents have submitted policy applications to the Company in the
past twelve months.
International Insurance Operations. National Western's international
operations focus on foreign nationals in upper socioeconomic classes.
Insurance products are issued primarily to residents of countries in Central
and South America, the Caribbean, the Pacific Rim, and beginning in 2003
Eastern Europe. Issuing policies to residents of countries in these
different regions provides diversification that helps to minimize large
fluctuations that could arise due to various economic, political, and
competitive pressures that may occur from one country to another. Products
issued to international residents are almost entirely universal life and
traditional life insurance products. However, certain investment contracts
are also available. At December 31, 2003, the Company had nearly 60,000
international life insurance policies inforce representing approximately
$10.2 billion in face amount of coverage.
International applications are submitted by independent contractor
broker-agents, many of whom have been submitting policy applications to
National Western for 20 or more years. The Company had approximately 4,300
independent international broker-agents contracted at December 31, 2003,
nearly 49% of which have submitted policy applications to the Company in the
past twelve months.
There are some inherent risks of accepting international applications which
are not present within the domestic market that are reduced substantially by
the Company in several ways. As previously described, the Company accepts
applications from foreign nationals in upper socioeconomic classes who have
substantial financial resources. This targeted customer base coupled with
National Western's conservative underwriting practices have historically
resulted in claims experience, due to natural causes, similar to that in the
United States with the exception of a small life insurance block in Haiti.
The Company minimizes exposure to foreign currency risks by requiring
payment of premiums and claims in United States dollars. Finally, over
thirty-seven years of experience with the international products and its
longstanding independent broker-agent relationships further serve to
minimize risks.
ticker:
NWLIA
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