Thoughts from the president Dear valued Gleaner members: Korinne and I recently heard the following quote during an online sermon given by our former Pastor Adam Hamilton at United Methodist Church of the Resurrection in Overland Park, Kansas: “Do not be dismayed by the brokenness of the world. All things break. And all things can be mended. Not with time as they say, but with intention. So go. Love intentionally, extravagantly, unconditionally. The broken world waits in darkness for the light that is you.” - L. R. Knost As I write this letter near the end of February, the snow is beginning to melt away rapidly as the temperature heads into the 40s in southeast Michigan. The COVID-19 vaccination rate is accelerating, and more vaccines are being developed and approved. I’m thankful that both my parents are still alive and well, and now have been vaccinated! The friends and family we know and love who have had the COVID-19 virus thankfully had mostly manageable symptoms and fully recovered within a week or two at the most. But many were not so fortunate. Gleaner has experienced a manageable number of COVID-19 death claims, mostly involving longer-term annuities, and mostly claims from our older members in their 80s or 90s. We have noticed an increase in the number of life insurance claims related to COVID-19 in the last quarter of 2020 and first quarter of 2021. We’ve only had one larger life death claim related to COVID-19 so far, and it was really our only early claim in the first certificate year. As we reported last time, the Society had an outstanding year in 2020, despite the “opportunities” of both low interest rates and the pandemic. We grew our life new business premiums by 54%, and our annuity new business premiums by 20% over 2019 levels, setting a high bar to climb for 2021! We did maintain both our A.M. Best and KBRA ratings at “A-” with a stable outlook. We did finish the year with member surplus of $124.9 million, and our current Surplus Ratio of assets for each $100 of liabilities is now a very strong 110.13%! See the full report on our 2020 financial statements on pages 8-9. www.gleanerlife.org
We entered into a second annuity reinsurance transaction with Heritage Life in mid-2020, further reducing our interest rate risk profile. We strengthened our balance sheet by adding $18.6 million to our universal life reserves with 4%-6% guarantees, while formally beginning the process of terminating our frozen defined benefit employee pension plan at an additional cost of $2.5 million. All vested accrued benefits our employees have earned will be honored and paid as required under ERISA and by our own honor. We are, after all, an organization that truly values its employees, members, and agents! See the additional information on our annuity reinsurance amendment adding the 3% guarantee business on pages 10-11. Lastly, we are still planning to have our 60th Biennial Convention in person celebrating fraternalism on October 22-24 at the beautiful Belterra Resort & Casino in Florence, Indiana. We have four Board Directors we hope our delegates will agree to re-elect for new four-year terms. It’s been our Senior Management team’s pleasure to work with each of them, and our many successes in these difficult times could not have happened without their full support. See the additional information on the upcoming Convention on pages 4-5. We hope to see you there! Aldous Huxley, the philosopher and author, once said: “Experience is not what happens to you; it’s what you do with what happens to you.” Our employees have responded to what’s happened to them during the pandemic in amazing ways, adjusting to working from home quickly as required, masking up and social distancing whenever in the office, all the while meeting our agent and member needs at the same high level expected of Gleaner, throughout 2020 and into 2021. We wouldn’t and couldn’t be who we are as an organization without our dedicated employees. On behalf of our thankful members, agents, and Board of Directors, we salute our employees for their exceptional service!
Fraternally, Kevin A. Marti President & CEO
Forum Magazine \ Spring 2021 \
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