ICMIF member Thrivent (USA) is returning an estimated USD 280 million in dividends in 2021 to clients who own eligible insurance products. This is the result of rigorous expense management, strong investment practices and careful underwriting of new business which reflects Thrivent’s commitment to helping clients achieve their financial goals.
Thrivent’s structure as a not-for-profit, fraternal benefit society allows it to return a portion of any surplus to eligible clients in the form of dividends. While dividends are not guaranteed, Thrivent has paid them since 1913. In the last 10 years, more than USD 2.9 billion in dividends have been distributed.
As a mission-driven, holistic financial services organisation, Thrivent offers its more than two million clients a broad range of financial solutions to help them thrive, including insurance, banking, investment options and financial advice. Driven by a higher purpose at its core, Thrivent is committed to focusing on its clients’ goals and priorities, guiding them towards financial choices that will help them live the life they want today – and tomorrow.
The Thrivent Board of Directors determines whether dividends are issued each year, after setting aside amounts necessary for providing for the growth of the organisation and for protecting the organisation’s ability to meet ongoing and future claims and obligations.
Thrivent’s decision to issue dividends is based on many factors, including:
- Claims experience (mortality) – Thrivent uses a conservative assumption for the death claims it expects to pay, which is used to determine contract premiums. Mortality savings result when the amount it pays out in actual death claims is less than what was assumed when premiums were determined.
- Investment results – Favourable investment results can occur when the actual investment returns exceed the guaranteed interest rate required to meet contractual obligations to contract owners.
- Expense savings – Thrivent factors expenses into contract premiums. Expense savings can result from a disciplined business approach; when the cost of doing business is less than expected, the outcome contributes to surplus.
After determining the total amount available for distribution, the value each contract receives is based on its contribution to divisible surplus. This is known as the “contribution principle.”