Q4 2019 Earnings Call
Full-year results for 2019 were similarly strong with a record-setting two billion dollars in adjusted operating revenues which represents an annual increase of 7% adjustment tax income of $467 increased 11% while diluted adjusted earnings per share increased 15% Roa e was 23.5% compared to 22.8% in 2018 and 2019. We met our goal of repurchasing $225 million dollars of common stock and paid a total of 58 million off in dividends returning 79% of operating earnings to stockholders in reducing our share count by approximately 4% year-over-year.
the continued
Mental strength and stability of our business model gives us confidence to increase Capital deployment to 250 million dollars in twenty twenty and raised our first quarter dividend by 18% off of $0.40 per share.
Turning now to slide for it to review the fourth quarters distribution results. We recruited 60,000 new Representatives during the fourth quarter or 2% fewer than the prior Year's fourth-quarter and added 11,000 New Life Insurance licenses, which is comprable to the number added during the fourth quarter of 2018. We ended the year with 130,000 522 life insurance license representative, which is in line with the end of 2018.
For a term life business on Slide Five we continue to see the positive impact of our efforts during the fourth quarter. We should 71,000 new life insurance policies, which is in line with the prior Year's fourth quarter.
Productivity at .18 policies for life insurance license representative per month remains within our historical range of .18 two point two two and in line with last year's quarter looking forward. We continue to believe that a long-term growth rate in New issued policies will average mid single-digits as we mentioned last quarter premium growth is also in Hancock by increasing benefit Riders In other coverage additions.
Highlights from our investments and savings products business or presented on slide six sales during the quarter with two billion dollars increasing 14% compared to the fourth quarter of 2018 and setting a new course record ending client asset values surpassed the seventy billion dollar Mark for the first time you do a combination of strong Equity markets in 2019 annual net new client inflows have one point 1 billion dollars ends of recovery from the 2018 Year End Market pullback this represents a 22% year-over-year increase in total assets under management.
Middle-income families continue to look for investment solutions that offer guaranteed income streams or downside protection are annuity Partners offer products with those attractive features that are in high demand with variable annuities remain a major driver of sales growth sales of variable annuities increased 22% compared to last year's fourth quarter and 20% in the full year-over-year comparison month. Now the 2019 is behind us. I want to take a moment to reflect on the full year following several consecutive years of strong growth and recruiting licensing issue life apps and rep productivity 2019 had a week start against difficult year-over-year comparisons. However, as the year progressed we saw signs of improvement by the fourth quarter of 2019. Most of these numbers will either back in life very close to the levels of the prior-year.
Our progress is a result.
Of our efforts to create a growth Focus for all of our efforts including our process improvements are messaging and our incentives during 2019. We achieve several milestones. We issued ninety-eight billion dollars in term life insurance face amount which we believe will rank us as the second largest term life insurance provider in North America during 2019. We now have a record level of eight hundred eight thousand dollars of term life insurance face amount enforce. We also sold a record seven point five billion investment products. And as I noted earlier reached an all-time high of over seventy billion dollars in class asset values these production levels and our discipline business approach led to the strong financial performance discussed earlier.
More than ever our sales force remains committed to helping middle-income families protects against the financial burden associated with the loss of a loved one while simultaneously helping them invest for the future months.
20/20 is off to a strong start building on the momentum from the end of 2019. We started the New Year by holding our largest ever seen your field leadership meeting in Dallas to engage with our most team members of our sales force and communicate our priorities for the future to strengthen our message. We added nine new meetings during January with regional vice presidents from across the u.s. And Canada to catch the vision to the decade and reinforce our message from the senior leadership meeting if these events we introduced a number of initiatives designed to drive growth and 2020 and Beyond these included higher intensity in our messaging new technology and very practical support such as the implementation of a life insurance wholesaling team to assist and product and sales training.
We're laser-focused on.
Strengthening our business including recruiting licensing and growing the size of our sales force. We also continue to invest intelligently in our business where we see opportunity to fulfill the need in our markets improve the client experience all while making it easier for our representatives to conduct business. We look forward to 20 20 with increasing excitement in Mark's not only the beginning of a new year but also a decade filled with opportunities to continue serving our clients. It also marks our tenth anniversary as a publicly traded company which we view as an important Milestone to celebrate with that while now, he's told Allison. Thank you and good morning everyone as we turned to the term life segment on slide seven. Let me briefly review fourth-quarter results and then provide insights into our twenty-twenty expectations for the segment.
The fourth quarter term life revenues were $390 million an increase of 9% year-over-year driven by a 10% increase in adjusted direct premium operating. In fact before income tax is going 14% to eighty two million looking at the individual elements of our term life segment incorrect claims. We're generally in line with the prior-year as with the choice of the benefits and claims ratio at 57.7%
The Jackhammer is
Nation ratio, which is typically high in the fourth quarter due to seasonally week or persistency with 16.4% for the quarter. Well below the prior-year ratio of 17.1 dead.
While there are several drivers of the deck ratio persistency is a noteworthy Factor after a period of weaker persistency in late 2016 and 2017 Ford Edge stabilized in 2018 and throughout 2019 has improved two factors horrible levels. The fourth quarter shows the largest Improvement today versus the prior-year insurance expense ratio for the quarter was 8% higher than the 7.8% in the prior year. But slightly lower than we had indicated last quarter during the quarter of weed up our segment allocation of information and cyber-security expenses, which shifted some expenses on a full year basis out of term life company-wide insurance and other apps extensions were in line with our expectations for the quarter month.
I will discuss company-wide insurance and other operating.
This is for the quarter as well as expectations for 2020 including a high level of segments allocation later in the call.
Let's shift our discussion to term life projections for 2020 starting with a deeper dive into adjusted direct premium as shown on slide 8 just to direct premium package include direct first year and Direct renewal premium and policies issued post-ipo direct premiums on policies issued pre-ipo and premium seated to the IPO Club. Each of these components have different Road stripes.
Direct first-year premiums are mainly driven by the number of policies issued each year coupled with the size of those policies as well as additions and increases in premiums primarily are increasing benefit Rider post-ipo Direct renewal premium grow each year from Larry another year or sales on to the enforced premium base. We've often referred to this at the building back of our enforced block post-ipo total post-ipo direct premiums grew 12% in the aggregate in 2019.
May I direct renewal premiums have been declining about 3% per year as the closed block runs off historically premium seated to the IPO. KO insurers bought an off at the similar rate. However, beginning in 2017. We stop feeding premiums that reached the end of their initial level premium. Which accelerated the rate of decline to around 6%
Chart on the right side of the slide shows our growth expectations for adjusted direct premiums by components first year premium assume a hypothetical growth in issue policy 3% combined with growth in premium editions from increasing benefit Riders post-ipo renewal premiums continue to grow but at a diminishing rate off each block of new business added is smaller in comparison to the growing enforce. We expect pre-ipo direct premiums to continue to run off at a rate of 3% and any money and premium seated to the IPO cultures to decrease at a rate trending towards 5% Annually net net for 2020. We expect adjusted direct premiums to grow 9% and at a 3% annual growth in sales for the growth rate to decline by approximately 1% in both 2021 and 2022.
Continuing with other aspects of term life performance. We do not receive any significant changes in either the benefits and claims ratio or the deck amortization ratio in twenty-twenty. But recall that I'm growing block of increasing benefit Riders generally have a lower deck ratio and higher benefits ratio than newly-issued business.
Margon should remain in the mid nineteen percent range while still allowing for investment in new technologies support the term like business.
turning now to our investments and savings products segment on slide 9 revenues of 182.7 million increased 11% year-over-year while income before income tax has increased 16% to fifty three million sales revenues grew around twelve percent in line with growth in Revenue generating product sells sells space net revenues as a percentage of Revenue revenue-generating product sales increased during the quarter reflecting a higher mix of annuity sales during the.
These revenues grew 12% in line with growth in average client asset values which benefited from strong sales and market conditions throughout 2019. As far as the recovery from the market pullback in the fourth quarter of 2018 at the base net revenues at the percentage of average asset values were also higher in the quarter benefiting from segregated fund a Cameron ization. That was about a million lower than historical levels due to favorable market performance as well as annual assumption setting for Redemption rise and operating expenses in the segment with largely due to publication revisions. I discussed earlier
Moving to our corporate and other distributed product segment adjusted operating revenues of 29.3 million declined 8% while benefits and expenses of 43.1 million Rose 7%
The decrease in segment revenues reflects lower ancillary product income as well as lower net investment income as more nii is allocated to the term life segment to support growth in the block of birth on a company-wide basis net net investment income groups 3% driven by growth in the invested asset portfolio partially offset by lower overall yields wage increase in CNO benefits and expenses was driven by two million higher insurance and other operating expenses and a 1.7 million dollar charge to write off amount Seated on a block of business to a reinsurer counterparty ordered into receivership. We have not seated new business to this particular reinsure in over twenty years.
Let's turn now to.
For a discussion of Consolidated insurance and other operating expenses during the fourth quarter expenses increased 9% year-over-year to a total of 106.7 million which was in line with our expectations.
The growth was driven by year-over-year increases in employee salaries and expenses that support the growth of our term life business. It also included around 3 million and higher costs related to age of Technology initiatives. We've discussed throughout the year for a total incremental technology spend of 10 million and 2019.
Looking forward to 20 20, we anticipate insurance and other operating expenses will increase between twenty-five and thirty million or six to 7% year-over-year the exact total insurance and other operating expenses to be sweat about 45% of term life 30% to ISDN and 25% corporate another as a reminder of the first quarter expenses are generally about ten million higher than other quarters due to the annual Grant of management Equity Awards in February.
Talk shows, the main components of expense growth. The first category includes expenses that are tied directly to a revenue Source such as premium taxes asked if they seize and record-keeping fees off the four million dollar increase shown reflects, your your savings of approximately five million in from service provider contract changes and operational efficiencies. We've discussed in the past.
Salaries and other employee-related costs excluding those related to technology which I'll discuss in a moment are expected to grow by approximately six million dollars. The increase is due to a combination an annual Merit increases Staffing increases and higher employee benefit costs.
Technology costs are expected to increase by eight million dollars our priorities for the year include client and new engagement term life sales process Improvement business intelligence and continued infrastructure modernization salaries and benefits for employees and contractors that are assigned to technology initiatives are included in this category.
Yes, our Revenue growth opportunity. We are investing in both new and existing product distribution. You're embarking on a multi-year expansion of our mortgage program, which is expected to add $3,000 to twenty twenty costs Glenn mentioned earlier. We are adding a team of wholesalers to support our term life business and then have included two million dollars in this year's budget project support their efforts. Finally. We've added two million dollars to cover require mailings and other implementation costs associated with the scc's rag bi and other potential regulatory changes. Let me wrap up with some holding company statistics on slide 13. Our tax rate during the quarter was 23.4% and 23.2% for the full year is consistent with our annual rate estimate. We expect the 2020 full-year rate to be around 23.5%
A corporate balance sheet remains strong with ample liquidity as of December 31st holding company liquidity is approximately 270 million and Primerica Life statutory e r space Capital ratio is estimated to be around 440% the plan to continue to take ordinary dividends from Primerica Life to the extent available with the goal of maintaining our near-term RBC ratio in the low-to-mid 400% range operator. Let's open the line up for questions.
Yes, ma'am.
We will now begin the question-and-answer session to ask a question. You may press * then 1 on a touch-tone phone. If we're using a speaker phone, please pick up your handset before pressing the wrong if any time request and has been addressed. Do you like to withdraw your question, please? Press * then two at this time. We will just pause momentarily to Assam our roster.
And the first question we have will come from Mark use of Sanchez, please. Go ahead. Thank you. Good morning.
Glenn did you give an outlook for the sales force headcount and recruiting. I think you've done that in the past. I'm sorry if you did and I missed it, but I didn't in my prepared remarks. I mentioned kind of a mid-single-digit rain for term new policy issues and Mark is we look out over the extremely long term. That's generally the same range as you know, the the sales force and and New Life business tend to have a pretty direct relationship. So as we look over the very long-term, we see that you know, I describe the Dynamics from 2019 with a week start first half and then some recovery in the second half and so as we see that over multiple years that's that's kind of what we anticipate with extremes on either side of that as we go
the
If the mid single-digit the new policies issued would be a little bit of improvement from the recent trend. Is that is that right? What gives you confidence in the yeah, that's you know going back to the long-term average and and the confidence I take from that is is what we've seen during the four quarters of 2019 as we have seen some recovery, you know early in our discussion several courses. I taught that I'd hope to be back kind of even-keeled by mid-year and we were a couple of quarters late on that but we did get there close to it in the fourth quarter and even during the quarter we saw strength as the course progressed. So, you know, I don't think that's an unreasonable view to have it all based on what we're seeing.
Yeah, and I'm sorry. Did you say where you would anticipate the sales force and totaled to be say 12 months from now? No, we haven't given that specific. You got a lot of moving Parts under that so we haven't been that specific that number.
Any general sense of that?
Well again, I mean, we hope that we hope to grow it. I mean, that's the whole purpose but no, I don't, you know again long-term. I think you're going to see it in mid single-digits whether you see see that a little a little worse than 20/20. It's a little early to tell but I can't tell you, you know, we we did feel good about the clothes the very close to 2019 and we feel good about the starts 2020.
And then on persistency talked about a nice Improvement in the fourth quarter. Does that portend improve persistency in 2019? I'm not sure whether you mentioned that on a some sort of rolling basis and also any explanation you've got. I I know it was more of a return to normalcy. But are you seeing anything in life underlying data that gives you some detail about why that is improving sure. So we do actually if you go back and look if we go back historically we actually see that our our persistency is very much now in line with historical Trends similar how we talk about things like productivity. I mean this business is very predictable in a Range. We're in that range. So I don't really see a reason why I should expect there to be a dramatic increase from where we are today.
Meto obviously be
Volatility specifically by duration, but but we are very now comfortably in our historical range. And in fact, even at when you look at very early duration perceived to see, you know, very strongly in that range. So meaning on the low end of the range so I don't necessarily think they'll be any further dramatic shift really our goal had always begin to get ourselves back to this particular level. Obviously, we always do things in our business to try to continue to improve we have the law of large numbers which kind of that we always get back to a range. But but let me highlight a couple of things we have been doing over the last few years really specifically taking advantage of tools that are available in the market place and I know it sounds a little silly but it's sometimes has to just do with simply making it very convenient for someone to be able to say link a bank account or make sure we did Ed.
Get any kind of error in banking information as we were.
Out the application anything we can do to help ensure that we have great information up front and on an ongoing basis will really help our persistency and we have put in place several schools over the last two invites a year or two that have really helped ease this Administration and improve the accuracy of our billing and collecting process. And I and I do think that accelerated some of the progress with persistency. But again, ultimately we have just gotten back to what we would call our historical norms.
And then the final question any update there was some discussion of Medicare advantages of potential initiative last quarter any updated thoughts there. Yeah, we continue to monitor that spam just to to try to size up the opportunity. It's on our radar. We don't have any immediate plans to launch anything. We're still looking at the at the various models of that business name could complement what we do rather than compete with what we do. We're very careful. You know, we're we're looking for additional growth additional profitability additional compensation for home, of course, not simply cannibalized what we do today. And so we're we're studying that very carefully as we look into the future, but we're still optimistic that out there somewhere there's an opportunity.
Thank you.
Blood help. Thanks Maura.
And next we have Dan Bergman up City morning. Dan Martin, I guess the start if I if I have it down, right? It sounded like term life margin guidance in the mid. Nineteen percent range was a little better than your prior guidance for just about 19% that you talked about last quarter. I just wanted to see if there's any more color on what drove the Improvement and whether any changes more reflective of birth allocation of expenses across segments that I believe you mentioned in the prepared remarks or more a different different view of core profitability.
Doesn't sound like Dan so I don't know if it is this Dan. Yeah. Okay. I'm sorry. You sound a different story than maybe if my hearing I didn't know if somebody else was using your phone. Anyway, I wouldn't really say when I that there's been any change truth be told we have now actually finalized our budgets for twenty twenty-six. So I I would say I have a little bit more clarity than I would have had back in November on our call. But the what I said back then and what I said now really is very consistent. Some of it may have to do with where expenses were going to fall out from an application perspective, which I did share with you in my prepared remarks. So overall and and quite frankly we did see in June fourth quarter that persistency pick up which which just gave us sort of a little bit more comfort in feeling like twenty-twenty was going to be you know, where we had hoped it would be which is quite phone number.
in the historical
So I don't think there's been any change in sentiment just slightly more Precision because I now have a budget to look at.
Got it. That's that's great. Thanks. And then maybe just in investment and savings products to variable annuities. If continue to be a source of sales strength, and even we've seen a number of new writers report somewhat lower sales recently after some changes to product pricing and features give them a low-rate environment. I just wanted to see if they've been there have been are there any plans for pricing changes by your VA or index annuity providers or just any general thoughts on how you'd expect sales of those products to try and going forward they've continued to be strong for a significant period of time which you know is a little unusual with any product sales to be that strong for that long, but it appears to be driven. As I said in my remarks is as we stay close to our clients by the concern with you know, the length of the bull market are there disruptions out there in the market itself or in the political environment. And so it has people placing a pretty high value on the on the benefits and the stability that come with va's. I'm not aware of any discomfort.
In with our product providers on pricing changes at this point. So I think the answer to that is have not heard of any of that coming from our providers.
So we're anticipating, you know continued strength in that business, you know, the the numbers the percentages get harder and harder as the business gets bigger and bigger obviously, so there should be some normalization you would think just in the math of that but we do expect a man to continue, you know, borrowing some unusual disruption in the marketplace and some of that disruption actually could have been in favor could be in favor of that because you just gave you but you know our mix shifts with the sentiment of clients and the performance of the market and this has been an extended period of strength for va's looks like it's got some momentum left, but you know, it's it's a little hard to to read what might happen out there, but we're not aware of any fundamental changes in that dynamic.
Got it. Thanks. Thanks both you for taking my questions. That's great.
The next with Andrew klingerman of Credit Suisse or an Andrew. Hey, good morning. And I'm definitely Andrew klugerman recognized just if you were checking Alison Krauss anyway, you know, I I look at your your sales force and and and I appreciate the point Glen that you know, historic levels were mid-single-digit fact, ten years ago. Nobody thought you were going to have are a lot of people didn't think you were going to increase from 100000 reps and yet I look as as recently as a teen, you will grow 3% off 78% and then this year your flat and I look at you know, your commentary adding term life wholesalers higher-intensity new technology for the same Force. I just you know, it's a big number 130000 reps. What can you put your finger on something that gives you that confidence?
That that that's good.
Get that mid single-digit growth that that you're highlighting have have we stalled now finally or or do you know what gives you that confidence? Let me let me share with you the exactly what I share with our sales force at those meetings. I mentioned in January we put a we put on a lot of frequent flyer miles in January addressing the same issue because that's a very common question. As you said, we've we've done it before and and I want to make sure that everyone understands why we recognize that things tend to move back to the long-term trends is Allison was describing with persistency. We don't just sit and wait for the trend of normal life, whether it's that persistency discussion Allison was having the growth of our sales force our productivity. We are looking for ways to move, you know back into Trend and as we've done a few times in some of those numbers bump out the top of the corridor and so I think that leads directly to your question Andrew is as how do you effect that how do you impact that so, you know during those few meetings we talked about not just the vision for twenty twenty years.
But how we see the next decade?
And we really got great response from that because there's something you know, there's only so much you can accomplish in a year. But when you start thinking in a 10-year block people can start to visualize what can be accomplished over a long period of time and so the logic Trail I took them about them. First is just when you first of all you start with the huge need that exists in the marketplace today, I mean, can we grow Beyond where we are just looking at what's out there right now at this moment and as I've said many times before, you know, there's a 25 trillion dollar protection Gap about half of that is we believe is in the Middle Market. So, you know twelve trillion plus, you know, we turned 43 years old day before yesterday as the company. We don't even have a trillion enforce yet. There is a ton of need out there that's unmet so it's not like there's a market saturation down in it off then when you start to look Beyond where we are at that starting point to the next decade. I mean, it's easy to see, you know population estimates 25 million increase in population in the u.s. And Canada over the next decade is the best number I am
But when you look underneath that and record.
Now it's at the fastest growth within that population growth is going to be in diverse markets and in younger markets that the tail end of the Millennials and gen Z the tidal wave coming those happen to be particular areas of strength for Primerica. We are a very diverse organization. Our customer base is extraordinarily diverse. Our sales force is extraordinarily diverse and extraordinary young compared to our competitors. So as the market grows, we believe that we happen to be positioned in sweet spots in the market. And so those are external dynamics that we believe in our favor. And so what are we going to do with that? And so you know what the first thing we're going to do is we're going to make building a Primerica business more attractive. We're going to improve our support for entrepreneurs. We're going to expand our product set. We both know. We just mentioned we're looking at the senior health business. We we kind of moved our mortgage thinking we learned a lot about the mortgage business last year and our pilot phase now we're categorizing our mortgage business has moved
into the start-up phase so we've got better support better product set increasing Financial opportunity that makes us more attractive to recruit more people and then when those people
You know say I want to build a Primerica business. We're working very hard on improving the licensing pull through and that all of the things that we can do with the sales process to increase productivity. So I think there's the the the the, you know, theoretical there's the external and then there's the Practical side of that and and I think we're working in significant ways on all of that and I don't see any limitation other than the fact that nobody's ever done it before I think it's it's simply just a mental block that we all have that my gosh. Nobody's that big now how big can it get and and we believe, you know will break the four-minute mile off. I mean, that's we'll just do it and then that will expand the vision and and there's room for us to continue to grow.
That's very very helpful. Thank you. And and and then you know kind of on that topic, I'm curious as to how many sales reps were licensed to sell mutual funds a year end 2019 and has Primerica seen an uptick in the number of term life reps willing to sell is a ISP products following the launch of the easy key sales tool the answer there is yes, we'll get you an exact number because we usually do give a full year number on that front. And that is that Salesforce is a growing and it grow in 2019 and we are seeing continued interest. I mean you we've we've expressed on this call the success of that side of our business. That's the number one attraction to somebody wanted to get the another license is that they see others succeeding in that business. And of course we're having records to settings success in that area and so easy key has been an important job.
part of that story because
Pause. So are you a number? Was it about $25,700 and change? So that was up how much that was about 2% of lead up to 2% for the year and we are seeing you know, we have a continuous pipeline. Now, you know, we we've said before on this called the recent licensing changes for the mutual fund life is beautiful and registration those were a little intimidating and it did cause a bit of a pause as people said what is this new process where the exam has been broken into two pieces? How is that going to impact and so we had a little bit of a slow down as people adapted to that to that number. And by the way that said North America wide number I gave you which includes Canada and so forth. But as we have experienced that we've actually found out our past ratios are actually higher than they were under the old process. So it's interesting human nature being what it is the unknown cause people to slow down.
Wait, and let's check this out.
But then we once we got people to start trying it they actually performed better. So that encourages encourages us that as we go forward. We can build momentum in that licensing. We continue to have success in that area. That's a huge attraction and then the technology like easy key that makes getting into that business less intimidating and simpler is a huge Advantage. So once again working on a number of fronts to continue to get that and you know, it's it's it's primarily been growth in productivity that has driven the numbers, but underlying that for the long term. We recognize we need a larger sales force there as well and working toward that much. Why the hell. Thanks, Andrew.
And next we have Jeff Schmitt of William Blair. Good morning. Good morning. Good morning. Looking at the the net product commissions South on on product sales 1.35% higher than it's been in it. Looks like you know five years or more what's driving that I mean is that just a a chef to you know, you're selling more annuities or is there something else going on there? It's definitely because of annuities. There's actually also within annuities a m a product shift. We want some products last year that have a slightly different profile on the net revenue ratio. So that was a piece of it for the short answer is it was all a function of variable annuities, but it was a combination of overall mix shift towards variable annuities as well as some new products off.
in variable annuities
Give us slightly higher net revenue ratios.
Okay. Yeah, I was going to say cuz the net commission stayed flat last year, but growth was really good and annuity so yet within the new adiz, there's some changes there I guess. Yeah, we did launch a few new products that have slightly different earnings profiles for us and that's what you're seeing and they were launched. I think if they're I think we're 20 late 2018 could be wrong on that but they were launched relatively recently bought okay, and then in terms of agents that can sell those products the annuities products in specifically not just the bigger mutual fund number growth was has been kind of a little bit lower there than for those that can sell mutual fund. Did you see that hiccup or is this a productivity increase your wages from ones that already that can sell annuities?
Yeah, the annuity business is a little different even within our business. It's it's one of the more sophisticated parts of our business kind of at the upper end, you know larger tickets. I'm probably more like traditional broker-dealers in a lot of ways than our our overall kind of middle-market business. And and so what you have is you have people go and get the certification off to sell annuities. It's it varies by some states have an additional in the connection registration with the the insurance companies. There's two or three different ways of adding that capability, but we see people do it that are in larger markets and more sophisticated markets with larger tickets. And then we also see people that that do it just in case just in case they run across, you know, they're generally in life more smaller ticket Market, but they like to have that and so there's really two things that drive why people go on and get into that business. We've seen a pretty constant flow in that we haven't seen anything unusual.
Also, it does continue to increase in about the normal rate. So the majority of what you're
Being is a productivity gain. It's being driven more by increase in productivity because the rate of the sales force growth is similar to our mutual fund Sales Force and and the numbers are bigger than that. So obviously that means it's productivity gain driving is the most of that increased. Hey Jeff just to go back. I checked my notes the product that I was referring to. We actually launched in the third quarter of 2019 Chef just to clarify that
Okay, great. Thank you.
And that's the way they follow up from our hours of SunTrust. I don't get another hello the Allison in your kind of notional longer-term forecasts, you had to 3% annual growth in premiums. And I think you also mentioned growth from Riders would influence that the 3% and then to be new policy account growth and then the writers would be on top of that. That is correct. So the way I described it was that we expected to have we used in the scenario hypothetical 3% Obviously, well, you know in line with the comments Glen had earlier on the call and and that was a driving component and the other component would be the growing block of writers and other additions. So yeah me percent really had to do with new sales.
And you've had very good.
In growth in those writers. Is there any reason to think that should slow down relative to what's going on in terms of new business, you know, we don't believe that to be the case as well just from our forecasting perspective we did assume and we do assume that the growth will be consistent with what we've done over the last several years. So if you look back in our financial supplement its range anywhere from 8% year-over-year to 11% year-over-year and it's somewhere between 20 to 25% of estimated annual has issued premium. Now just to remind you that is not actually a a gap Revenue number. It is an estimate of an annualized number but I think it gives you a good reference point as to what our assumptions are for that block.
Thank you.
Oh, sorry, no further questions. We will quit conclude today's Q&A session, and also today's conference call. We thank you all for attending today's presentation at this time. You may disconnect. Thank you again everyone. Take care and have a wonderful day.
off
Thursday