May 8, 2020 - The Equitable Life Insurance Company of Canada® is pleased to announce that its Board of Directors has approved continuing the current dividend scale for the period July 1, 2020 to June 30, 2021.
We use the dividend scale to determine the dividend payment. Dividends are sensitive to all the factors that affect the participating account, but especially changes in investment returns. Even though the dividend scale is not changing, total dividend payments to policyholders are expected to increase due to the growing value of our whole life policies. Total dividend payments to policyholders from July 1, 2020 to June 30, 2021 are expected to increase to approximately $44.3 million compared to $39.1 million for the same period in 2019/2020.
As a mutual life insurance company, Equitable Life® gives its participating whole life policyholders the opportunity to participate in the earnings of the participating account through dividend payments. The dividend scale is reviewed to ensure that it is set at an appropriate level. We use the dividend scale to determine the dividend payment. If a dividend is declared, it is credited to the policy as a dividend payment. Dividends are sensitive to all the factors that affect the participating account, but especially changes in investment returns.
The sustained low interest rate environment continues to put downward pressure on the experience in the participating account. If low interest rates continue, investment returns in the participating account will also be lower, and we may need to decrease the dividend scale in the future. At the time of writing, the COVID-19 related equity market correction is also expected to have a negative impact on the experience in the participating account, making a future reduction in the scale even more likely.
About Equitable Life of Canada
Canadians have turned to Equitable Life since 1920 to protect what matters most. We work with independent advisors across Canada to offer individual insurance, savings and retirement, and group benefits solutions to meet your needs.
Equitable Life is not your typical financial services company. We have the knowledge, experience and ability to find solutions that work for you. We’re friendly, caring and interested in helping. The Company is owned by our participating policyholders, not shareholders. This allows us to focus on management strategies that foster prudent long-term growth, continuity and stability.
As we celebrate our 100th Anniversary in 2020, we are spending the year reflecting on our past and celebrating all the accomplishments that have helped us become one of Canada’s largest mutual life insurance companies. We’re excited by the future as we begin the next century for Equitable Life of Canada.
www.equitable.ca
Media Contact:
Keren Adderley
Director, Corporate Communications
Equitable Life of Canada
519 904 8470
kadderley@equitable.ca
