A policy owner dividend is based on actual experience versus our assumptions on a number of key risks we share with participating policy owners. These risks include investment returns from the participating account, mortality, expenses, taxes, inflation and lapses. Investment returns are the largest component of a policy owner dividend and a major factor in determining the dividend scale for a block of participating policies. The dividend scale interest rate is based on the portfolio yield of the participating account and takes into account other factors such as surplus levels and returns expected over the near term. We also use smoothing techniques to help keep the dividend scale interest rate more stable over time.

Current dividend information

We’re maintaining the Sun Life dividend scale, including the dividend scale interest rate of 6.25%, effective April 1, 2020.

The Board of Directors of Sun Life Assurance Company of Canada approved this decision. Their approval is based on the recommendation of Sun Life’s appointed actuary. It’s also in accordance with Sun Life's dividend policy.

Clients will continue to benefit from Sun Life’s management philosophy. They’ll also benefit from our long-term investment strategy, and the strength of our par account.

The dividend scale interest rate isn’t the return that a Client can expect from their policy. The rate reflects the investment experience of the par account, and is only part of a Client’s dividend. Other portions of a dividend include mortality, expenses, taxes and lapses. The dividend scale is sensitive to the performance of these factors.

We're maintaining the Clarica dividend scale including the dividend scale interest rate of 6.55% for 2020. This applies to participating policies issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. Our prudent management of the participating account has helped us maintain the dividend scale for the upcoming year. 

The dividend scale is sensitive to changes in performance factors such as investment performance, mortality rates, taxes and expenses. While we were able to maintain the Clarica dividend scale for 2020, it's not an indicator of future performance of the Clarica dividend scale. The dividend scale for Sun Life Financial is determined independently from the Clarica dividend scale, so a decision about the dividend scale for one of these blocks doesn't mean there will be a similar decision for the other.

The dividend scale interest rate isn't the return that a Client can expect to receive on their policy. It's a rate that we set, and it reflects the investment experience of the par account that is passed back as part of the dividend. Other portions of a Client's specific dividend include mortality, expenses and taxes.

The Board of Directors of Sun Life Assurance Company of Canada approved this based on the recommendation of Sun Life's Appointed Actuary, and in accordance with Sun Life's dividend policy.

Clients will continue to benefit from Sun Life's prudent management philosophy, our long-term investment strategy, and the strength of our large and well-established par account.

Historical dividend information

The dividend scale is sensitive to changes in performance factors such as investment performance, mortality rates, taxes, lapses and expenses. Our decision to maintain the Sun Life dividend scale isn't an indicator of future performance. The dividend scale for Clarica is determined independently from the Sun Life dividend scale, so a decision about the dividend scale for one of these blocks doesn't mean there will be a similar decision for another.

The dividend scale interest rate isn't the return that a client can expect to receive on their policy. It's a rate that we set and it reflects the investment experience of the par account that is passed back as part of the dividend. Other portions of a client's specific dividend include mortality, expenses and taxes.

The Board of Directors of Sun Life Assurance Company of Canada approved this decision based on the recommendation of Sun Life's appointed actuary, and in accordance with Sun Life's dividend policy.

Clients will continue to benefit from Sun Life's prudent management philosophy, our long-term investment strategy and the strength of our large and well-established par account.

We're maintaining the Clarica dividend scale including the dividend interest rate of 6.55% for 2019. This applies to participating policies issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. Our outlook for the portfolio yield and our projections for interest rates has helped us maintain the dividend scale for the upcoming year.

The dividend scale is sensitive to changes in performance factors such as investment performance, mortality rates, taxes and expenses. While we were able to maintain the Clarica dividend scale for 2019, it's not an indicator of future performance of the Clarica dividend scale. The dividend scale for Sun Life Financial is determined independently from the Clarica dividend scale, so a decision about the dividend scale for one of these blocks doesn't mean there will be a similar decision for the other.

The dividend scale interest rate isn't the return that a Client can expect to receive on their policy. It's a rate that we set, and it reflects the investment experience of the par account that is passed back as part of the dividend. Other portions of a Client's specific dividend include mortality, expenses and taxes.

The Board of Directors of Sun Life Assurance Company of Canada approved this based on the recommendation of Sun Life's Appointed Actuary, and in accordance with Sun Life's dividend policy.

The dividend scale is sensitive to changes in performance factors such as investment performance, mortality rates, taxes and expenses. Our decision to maintain the Sun Life Financial dividend scale isn't an indicator of future performance. The dividend scale for Clarica is determined independently from the Sun Life Financial dividend scale, so a decision about the dividend scale for one of these blocks doesn't mean there will be a similar decision for another. 

The dividend scale interest rate isn't the return that a client can expect to receive on their policy. It's a rate that we set and it reflects the investment experience of the par account that is passed back as part of the dividend. Other portions of a client's specific dividend include mortality, expenses and taxes.

The Board of Directors of Sun Life Assurance Company of Canada approved this decision based on the recommendation of Sun Life Financial's appointed actuary, and in accordance with Sun Life Financial's dividend policy.

We're maintaining the Clarica dividend scale including the dividend interest rate of 6.55% for 2018. This applies to participating policies issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. Our outlook for the portfolio yield and our projections for interest rates has helped us maintain the dividend scale for the upcoming year.

The dividend scale is sensitive to changes in performance factors such as investment performance, mortality rates, taxes and expenses. While we were able to maintain the Clarica dividend scale for 2018, it's not an indicator of future performance of the Clarica dividend scale. The dividend scale for Sun Life Financial is determined independently from the Clarica dividend scale, so a decision about the dividend scale for one of these blocks doesn't mean there will be a similar decision for the other.

The dividend scale interest rate isn't the return that a client can expect to receive on their policy. It's a rate that we set, and it reflects the investment experience of the par account that is passed back as part of the dividend. Other portions of a client's specific dividend include mortality, expenses and taxes.

The Board of Directors of Sun Life Assurance Company of Canada approved this decision based on the recommendation of Sun Life Financial's Appointed Actuary, and in accordance with Sun Life Financial's dividend policy.

The Board of Directors of Sun Life Assurance Company of Canada (Sun Life Financial) approved a recommendation to decrease the dividend scale for participating policies issued by Sun Life Financial.   Effective April 1, 2017, the new dividend scale interest rate* will decrease 50 basis points to 6.25% with updates to mortality, expense and lapse experience.

The current economic uncertainty, recent equity market returns and the ongoing low interest rate environment create downward pressure on the dividend scale interest rate. Sun Life Financial's combination of a long-term investment strategy, a large well-established par account and a prudent management philosophy continues to provide strong returns for our participating policy owners.

Reminder! The 2017 Clarica dividend scale interest rate for participating policies was maintained at 6.55%. It is important to remember that Sun Life Financial policies and Clarica policies each have their own participating portfolios. While the investment strategies are similar between the two portfolios, asset allocation decisions and asset purchases have varied between the two over time.

Key Highlights:

  • The Sun Life dividend scale interest rate* will decrease by 50 basis points (bps), resulting in a new dividend scale interest rate of 6.25%
  • The 2017 dividend scale will reflect updated mortality, expense and lapse experience
  • The new dividend scale applies to all Sun branded participating plans
  • The Sun Life Participating account is a well-diversified and high quality asset portfolio of almost $9 billion.
  • Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings providing clients with lifetime protection.

Our participating policy owners continue to be well served by Sun Life Financial's strong capital position, and financial strength.

A message from Léo Grépin, Senior Vice-President, Individual Insurance and Wealth.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life Financial") approved a recommendation to maintain the current Clarica dividend scale for 2017 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. Effective January 1, 2017, the dividend scale interest rate* will remain at 6.55%.

The dividend scale for our participating policies originally issued by Sun Life Financial (SLF) will be announced at a later date.

The dividend scale for the Clarica block of business is determined independently from the dividend scale for the Sun block of business. A decision about the dividend scale for one of these blocks does not necessarily mean there will be a similar decision for the other. For example, each par block has a unique effective date, and while similar, they have different asset portfolios.

The Participating account on the Clarica block of business is a well-diversified and high-quality asset portfolio of almost $12 billion. A number of factors including investment returns, mortality, expense, and lapse experience affect the dividend scale.

Léo

2017 Sun Life Financial Dividend Impact chart
Product group Impact of the dividend payout in 2017/2018

Open Block

Sun Par Protector 
Sun Par Accumulator
Series 2010

  • Majority of policies will experience a decrease averaging about 4.1%
  • Maximum Plus Premium benefit premiums won't change.
  • The projected premium offset dates will not be affected.

Sun Classic Life 
Series 2002

  • This block of policies will have an average decrease of 23.6%
  • The lapse factor was impacted by this dividend scale review

Sun Premier Life
Series 2002

  • Most policies will have an average decrease of 4.2%

Closed Block

Sun Classic Life 
Series 1996

  • Most policies will have an average decrease of 9.6%

Sun Premier Life
Series 1996

  • Most policies will have an average decrease of 5.7%

Opus
Series 1992, 1993, 1994

  • Most policies will have an average increase of 8.9%

All other participating policies
Series issued before 1992

  • Most policies will have an average increase of 0.7%

Miscellaneous

Premium offset (excluding series 2010)

  • In most cases, there will be no impact to the projected premium offset date. For policies that are impacted, the projected premium offset dates may be delayed by 1 - 2 years.

Special Maturity Dividends

  • Policies with Special Maturity Dividends will see an additional 10.3% increase to the annual dividend in addition to the changes above

A message from Brigitte Parent, Senior Vice-President, Individual Insurance and Wealth.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life Financial") approved a recommendation to maintain the current Clarica dividend scale for 2016 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. Effective January 1, 2016, the dividend scale interest rate* will remain at 6.55%.

The Board of Directors will review the dividend scale recommendation for our participating policies originally issued by Sun Life Financial (SLF) and for Sun Par Protector/Sun Par Accumulator closer to their dividend scale effective date of April 1, 2016.

The dividend scale for the Clarica block of business is determined independently from the dividend scale for the Sun block of business. A decision about the dividend scale for one of these blocks does not necessarily mean there will be a similar decision for the other. For example, each par block has a unique effective date, and while similar, they have different asset portfolios.

The Participating account on the Clarica block of business is a well-diversified and high-quality asset portfolio of almost $12 billion. A number of factors including investment returns, mortality, expense, and lapse experience affect the dividend scale.

Brigitte

A message from Brigitte Parent, General Manager, Individual Insurance & Wealth

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada (Sun Life Financial) approved a recommendation to maintain the dividend scale for participating policies issued by Sun Life Financial. Effective April 1, 2016 the dividend scale interest rate* will remain at 6.75%. The lapse, mortality and expense factors also remain unchanged.

The current economic uncertainty, recent equity market returns and the ongoing low interest rate environment continue to put downward pressure on the dividend scale interest rate. The future economic environment will continue to be an important consideration in the determination of the dividend scale. Sun Life Financial's combination of a long-term investment strategy, a large well-established par account and a prudent management philosophy continue to provide good value to our participating policyholders.

Key highlights

  • The dividend scale interest rate* will remain at 6.75%.
  • The Sun Life Participating account is a well-diversified and high quality asset portfolio of almost $9 billion.
  • Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings providing clients with lifetime protection.

Our participating policyholders continue to be well served by Sun Life Financial's strong capital position and financial strength. For over 150 years Sun Life Financial has been helping customers achieve lifetime financial security. Thank you for your ongoing support of our continued goal to help Canadians achieve lifetime financial security with a trusted global financial services leader.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life Financial") approved a recommendation to maintain the current Clarica dividend scale for 2015 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. The 2015 dividend scale interest rate* will continue to be 6.55% and will be in effect from January 1, 2015, to December 31, 2015.

The Board of Directors will review the dividend scale recommendation for our participating policies originally issued by Sun Life Financial (SLF) and for Sun Par Protector/Sun Par Accumulator closer to their dividend scale effective date of April 1, 2015.

The dividend scale for the Sun block of business is determined independently from the dividend scale for the Clarica block of business. A decision about the dividend scale for one of these blocks does not necessarily mean there will be a similar decision for the other. For example, each par block has a unique effective date, and while similar they have different asset portfolios.

Brigitte

A message from Brigitte Parent, Senior Vice-President, Individual Insurance and Wealth.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada (Sun Life Financial) approved a recommendation to maintain the dividend scale for participating policies issued by Sun Life Financial. The dividend scale interest rate* will remain at 6.75%. This dividend scale will be in effect from April 1, 2015 to March 31, 2016.

The Sun Participating account is a well-diversified and high quality asset portfolio of almost $9 billion. A number of factors including investment returns, mortality, expense, and lapse experience affect the dividend scale. Sun Life Financial's combination of a long-term investment strategy, a large well-established par account and a prudent management philosophy continues to provide strong returns for our participating policyholders.

Key highlights:

  • The dividend scale interest rate* will remain at 6.75%.
  • The dividends on deposit interest rate will remain at 3.25%.
  • Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings providing clients with lifetime protection.

Our participating policyholders continue to be well served by Sun Life Financial's strong capital position and financial strength. We continue to offer all clients a strong suite of products and Sun Par Protector and Sun Par Accumulator provide excellent value.

For 150 years Sun Life Financial has been helping customers achieve lifetime financial security. Thank you for your ongoing support of our continued goal to help Canadians achieve lifetime financial security with a trusted global financial services leader.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to increase the Clarica dividend scale for 2014 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. This decision affects the dividends for policies on their policy anniversary from January 1, 2014, to December 31, 2014.

The dividend scale interest rate* is increasing by 25 basis points to 6.55 per cent. This increase is the result of a combination of improvements in experience and our outlook for the portfolio yield compared to where the interest rate has been set in the past. In addition, the dividend scale for some blocks will reflect an overall improvement in mortality experience. Further details on the impact of this change for different blocks of business will be provided in early December.

The Board of Directors will review the dividend scale recommendation for our participating policies originally issued by Sun Life Financial (SLF) and for Sun Par Protector/Sun Par Accumulator closer to their dividend scale effective date of April 1, 2014.

The dividend scale for the Sun block of business is determined independently from the dividend scale for the Clarica block of business. A change in the dividend scale for one of these blocks does not necessarily mean there will be a similar change for the other. For example, each par block has a unique effective date, and while similar they have different asset portfolios.

Brigitte

As communicated on January 14, 2014, the 2014/2015 policyholder dividend scale is decreasing for Sun Life Financial (SLF) participating policies issued by Sun Life Assurance Company of Canada. This dividend scale will be in effect from April 1, 2014 to March 31, 2015.

A number of factors including investment returns, mortality, expenses and lapse experience affect the dividend scale. In spite of continued lower interest rates, only a relatively modest decrease is required, offering strong client value and demonstrating the strength and stability of the Sun Life Participating Account. The 2014 dividend scale interest rate will decrease to 6.75%.

Impact to policyholders

Participating policyholders will receive information specific to their policy on their policy anniversary statements beginning in mid-March.

SLF enhancement plans have guaranteed premiums but may have adjustable death benefits. Any enhancement policies that have no guarantee or a 10 year guaranteed death benefit that are past the 10 year guaranteed period may experience a death benefit decrease in 2014. Most policyholders will not experience a decrease in their current death benefit as a result of the 2014/2015 dividend scale.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to maintain the current Clarica dividend scale for 2013 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. This decision affects the dividends for policies on their policy anniversary from January 1, 2013, to December 31, 2013. The Board of Directors will review the dividend scale recommendation for our participating policies originally issued by Sun Life Financial (SLF), including Sun Par Protector and Sun Par Accumulator, closer to their dividend scale effective date of April 1, 2013. Participating policies may be eligible to receive dividends based on a variable scale set by the company each year.

I am pleased to announce that the Board of Directors of Sun Life Assurance Company of Canada has approved the company's recommendation to maintain the current dividend scale for participating policies issued by SLF, including Sun Par Protector and Sun Par Accumulator. The 2013/2014 dividend scale interest rate* will continue to be 7.15 per cent and will be in effect from April 1, 2013 to March 31, 2014.

Participating policies may be eligible to receive dividends based on a variable scale set by the company each year. Despite current economic conditions, we have been able to maintain the par dividend scale. However, this environment continues to put downward pressure on yields, which means we could be required to reduce the scale in the future.

The rate for dividends on deposit for policies issued by SLF will decrease by 50 basis points. The new rate will be 3.25 per cent for most blocks.

New business: Sun Par Protector and Sun Par Accumulator

Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings, providing clients with lifetime protection and the opportunity to earn policyholder dividends. Our competitive position remains strong. Our capital strength, diversified business model and prudent risk management practices form a foundation from which we fulfill our promises to customers.

For more information on participating life insurance and dividends refer to Answers about... participating (par) life insurance.

Brigitte Parent

This message has been sent on behalf of Kevin Strain, Senior Vice-President, Individual Insurance and Investments.

I am pleased to announce that on November 2, 2011, the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to maintain the current Clarica dividend scale for 2012 for participating policies originally issued by Mutual Life, MetLife, Clarica, Allstate and Prudential. This decision affects the dividends for policies on their policy anniversary from January 1, 2012, to December 31, 2012. The Board of Directors will review the dividend scale recommendation for our participating policies originally issued by Sun Life Financial (SLF) closer to their dividend scale effective date of April 1, 2012. Participating policies may be eligible to receive dividends based on a variable scale set by the company each year.

Kevin Strain

At the December board meeting, the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to decrease the dividend scale for most participating policies issued by Sun Life Financial (SLF). This dividend scale will be in effect from April 1, 2012, to March 31, 2013.

Reminder! The 2012 Clarica dividend scale for participating policies remains unchanged.

A number of factors including investment returns, mortality, expense and lapse experience affect the dividend scale. Despite the current economic uncertainty and unprecedented low interest rate environment, only a relatively modest decrease is required, offering strong client value and demonstrating the strength and stability of the Sun Life Participating Account. Our par policyholders continue to be well served by SLF's strong capital position, financial strength, professionally managed investment portfolio and risk management practices.

In-force business - SLF participating life insurance products

  • The 2012 dividend scale interest rate* will decrease by 25 basis points (bps), resulting in a new dividend scale interest rate of 7.15 per cent.
  • The dividend on deposit rate will be 3.75 per cent, except for RRSP policies and Bermuda policies with a variable loan clause.

In addition to the interest rate, some blocks were adjusted for other experience factors that changed. The overall impact of all the changes varies by block.

New business - Sun Par Protector and Sun Par Accumulator

Sun Par Protector and Sun Par Accumulator continue to be very competitive product offerings, providing clients with lifetime protection. In many cases, our competitive positioning has improved despite this modest dividend scale decrease as several other carriers have announced their own dividend scale reductions.

  • The 2012 dividend scale interest rate will decrease by 25 bps, resulting in a new dividend interest rate of 7.15 per cent.
  • On average Sun Par Protector and Sun Par Accumulator will see a decrease of approximately 3 per cent in their annual dividend with the 2012 dividend scale.
  • In a relatively small number of cases, the projected offset point may be delayed by one year, under this new dividend scale.
  • The dividend on deposit rate will decrease by 25 bps to a rate of 3.75 per cent.
  • Enhanced insurance dividend option maximums won't change.
  • Some maximum plus premium benefit premiums will decrease, but most won't change.

For more information on participating life insurance and dividends, refer to Answers about... participating (par) life insurance.

We continue to offer clients a strong suite of products, and our Sun Par Protector and Sun Par Accumulator provide excellent value.

This message has been sent on behalf of Kevin Strain, Senior Vice-President, Individual Insurance and Investments.

I am pleased to inform you that on November 3, 2010, the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to maintain the current dividend scales for 2011 for our participating policies. This decision affects the dividends for policies originally issued by:

Clarica, Mutual Life, MetLife, Allstate and Prudential on their policy anniversary from January 1, 2011 through December 31, 2011.

Sun Life Financial (SLF) on their policy anniversary from April 1, 2011 through March 31, 2012. Our new Sun Par Accumulator and Sun Par Protector policies are included in this group of policies.

Participating policies are eligible to receive dividends based on a variable scale set by the company each year. While the dividend scales remain unchanged this year, the sustained low interest rate environment continues to put downward pressure on the funds? performance.

Kevin Strain

This message has been sent on behalf of Kevin Strain, Senior Vice-President, Individual Insurance and Investments.

On November 4, 2009, the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved a recommendation to decrease the 2010 dividend scales for both Clarica and Sun Life Financial participating policies. This decrease affects dividends for policies originally issued by:

  • Clarica, Mutual Life, MetLife, Allstate and Prudential on their policy anniversary from January 1, 2010, through December 31, 2010.
  • Sun Life Financial on their policy anniversary from April 1, 2010, through March 31, 2011.

This decrease is required due to declining interest rates on bonds, loans and mortgages, the unprecedented deterioration in the equity markets in the past year, and the continued uncertain economic environment. However, we have been able to mitigate some of the impact of these factors with the improvement in mortality rates for non-smokers and expenses for some blocks of business.

Our policies continue to provide good value to policyholders, even with this decrease. While the overall portfolio rate of return has decreased about 100 basis points, it remains between 6.2% and 7.4% and is higher than the return many other investments can achieve in today’s market.

Although the dividend scales are decreasing, policyholders can be assured by the various safeguards that are in place to protect their interests, including:

  • all par accounts are kept separate from the accounts of non-par policies and other businesses,
  • the involvement of the Sun Life Board of Directors, 
  • the rigorous dividend management process, and
  • our annual reporting to the federal government regulator, the Office of the Superintendent of Financial Institutions (OSFI).      

For more information on participating insurance and dividends, visit Answers about…participating (par) life insurance.

Kevin Strain

Understanding participating life insurance and dividends can be challenging; we want to help you understand changes to our dividend scale and what it means to your policy.

What is participating life insurance?

A portion of the premiums we collect from you and other participating policyholders is used to pay immediate claims and expenses. The rest is kept in the participating account and invested to earn an income.

We are responsible to ensure the participating account is managed so there will be enough money to cover all current and future obligations for you and other policyholders. The remainder is paid as a policyholder dividend. Dividends are not guaranteed and can change each year. If necessary, we adjust these dividends based on the performance of investments, claims, expenses and other relevant factors related to participating policies.

Why are dividends decreasing?

We’ve decreased our dividend scale mainly in response to historically low interest rates on bonds, loans, mortgages and the deterioration in the equity markets in the past year. As a result, the rate of return on the invested excess premiums from your participating policy is lower than the rate we assumed when you purchased your policy. In the same way, many have experienced a lower rate of return on their savings and investments, dividends allocated to your policy have been lowered to reflect this difference between experience and assumptions. For example, Government of Canada 30-year bond interest rates in 1980 were approximately 12%. When that bond matures in 2010, it will be reinvested at a substantially lower interest rate of approximately 5%.

What does this mean to you?

The decrease in our dividend scale may result in an increase in the amount you are required to pay for your insurance, however, your policy continues to offer exceptional value. The overall portfolio rate of return has decreased by about 1% since we set the 2009 dividend scale, but the returns remain higher than the returns that many other investments can achieve in today’s market. The rate of return on your participating account is between 6.2% and 7.4%. Most guaranteed investment certificates’ interest rates range from 2% to 3.5%.

We review dividends each year and you can be assured of Sun Life’s solid financial strength, prudent financial management practices and our continued commitment to our policyholders.

Questions?

Contact us at 1-877-SUN LIFE (1-877-786-5433) or contact your advisor with any additional questions.  Detailed information is on our website at sunlife.ca/dividends.

2009 dividend scales for Clarica and Sun Life participating policies unchanged

I am pleased to inform you that the Board of Directors of Sun Life Assurance Company of Canada ("Sun Life") approved the following recommendations today, October 30, 2008:

  • The 2009 dividend scale for participating policies originally issued by Clarica will be unchanged. This affects dividends for Clarica, MetLife, Mutual Life, Allstate, and Prudential policies with anniversaries beginning January 1, 2009 through December 31, 2009.
  • The 2009 dividend scale for Sun Life Financial participating policies will be unchanged. This affects policies with anniversaries beginning April 1, 2009 through March 31, 2010.

Most participating policies are eligible to receive dividends based on a variable scale set by the company each year.

While we are delighted to maintain the dividend scale this year through these unprecedented economic conditions, sustained low interest rates on bonds, loans, and mortgages and the marked deterioration in the equity markets over the last several weeks continue to put downward pressure on the par portfolio’s performance.  Should current conditions persist or worsen, it is possible that a dividend scale reduction may be required next year.

Our customers are well-served by Sun Life’s strong capital position and financial strength through the current market conditions and can rely on Sun Life to be there when they need us the most. 

Kevin Strain

Senior Vice-President, Individual Insurance & Investments

Decrease in Special Maturity Dividends on Sun Life participating policies takes effect April 1 (February 12, 2009)

The Board of Directors of Sun Life Assurance Company of Canada approved a decrease in the Special Maturity Dividends (SMD) on surrenders for the Sun Life Financial (SLF) participating policies effective April 1, 2009. The change will be effective for each policy as of the next anniversary date on or after April 1, 2009. The SMD is a terminal dividend payable only on death, maturity or surrender. This change does not impact participating policies originally issued or assumed by Clarica and its predecessor companies.

As announced on October 30, 2008, the annual dividend scale is unchanged for the 2009 dividend year. This adjustment to the SMD is required due to declining interest rates on bonds, loans and mortgages and the unprecedented deterioration in the equity markets over the last several months. For this reason, it is also likely that a reduction in the annual dividend scale will be required in 2010.

SMDs apply only to SLF participating policies issued before 1996, for policyholders that did not elect the Optional Dividend Benefit. The magnitude of the decrease is as follows:

  • SMD – Death/Maturity: No change.
  • SMD – Surrender: The average SMD surrender value decrease is approximately 30 per cent. Individual changes will vary based on the duration of the policy and its growth in paid-up additions and cash values. The overall impact when a client surrenders one of these policies (i.e. including SMDs and cash surrender values), means a total reduction in the range of five to 11 per cent.

Despite this decrease, we still expect to pay approximately $37.5 million in SMDs in 2009. The new lower SMDs will be shown on the client's anniversary statements with effective dates on or after April 1, 2009. The following note will continue to be displayed on the back of the statement: No loans are allowed against the Special maturity death benefit or cash value since neither are vested or guaranteed and Sun Life Assurance Company of Canada may at any time without notice, withdraw or adjust them.

Our customers are well-served by SLF's strong capital position and financial strength through the current market conditions and can rely on SLF to be there when needed the most.