PPS Mutual has assigned more than $4 million in profit share to the accounts of qualifying members in the first five years since its inaugural profit share assignments were made in 2017.
The insurer says in a statement that it launched its Professionals Choice product in 2016, making its first profit share assignment in the following year and that it’s now announcing its fifth annual round of profit share rates to eligible members for the 2021 financial year.
The statement notes that the rates determine how PPS Mutual members share in the profits of the insurance they buy.
For the 2021 financial year, the members of the mutual company will receive a Profit-Share assignment of six percent of premiums.
It says members have also been assigned a further Profit-Share of 2.75 percent of opening balances (net of tax), “…providing strong portfolio growth in this low interest rate environment.”
The company says this assignment follows the seven percent of premiums plus 4.5 per cent of opening balances for the 2020 financial year (see: Profit Share Assignment to Members.)
… The Profit-Share pool has seen significant growth over the past four years…
It says that its Profit-Share pool has seen significant growth over the past four years, increasing eight-fold from $500,000 in 2018 to $4,200,000 in 2021.
PPS Mutual Chief Executive, Michael Pillemer, says the company will continue making Profit-Share assignments each year “…to reflect the operational performance of the Benefit Fund including investment returns.”
He adds that PPS Mutual is the only life insurance provider in Australia which currently offers life insurance products with a Profit-Share.
“Every professional insured is a member which entitles them to share in the profits of the insurance that they buy. And the amount assigned to them has grown year-on-year since we opened for business.”
The statement notes that policies are only available through financial advisers who have been accredited by PPS Mutual.
Pillemer says that one adviser group’s members have Profit-Share Account balances totalling more than $595,000 as of 30th June 2021, and one adviser’s members have Profit-Share Account balances of more than $270,000.
Pillemer adds that PPS Mutual membership has continued to grow significantly from 797 in 2017 to 5,336 in 2021.
PPS Mutual Members are required to retain their policies for 10 years to gain partial access to the Profit-Share funds. Full access is granted after 20 years or upon reaching age 65, and also on death, terminal illness, and certain other events.
