Owner Dividends Coming

Thursday morning, February 17th, the MTM Board met to review the recommendations from both the Board Marketing committee and the Board Finance committee. Those two committees do a preliminary review of financial results, and also structure the MTM member dividend program. At the end of the Marketing committee, a recommendation was made to the full Board for the parameters of this year’s dividend program. The following week, the Board Finance committee met to review the actuarial loss report, and the financial information provided by MTM management.

The result was that a $4 million dividend will be paid to MTM member owners. This is made up of two parts. Back in December in anticipation of a profit, the Board declared $2 million to be paid in March. The reason for this December declaration was to take advantage of an early tax write off. By pre-declaring that money we saved $420,000 in taxes. That would increase the amount available to send to MTMs’ members. In January the actuary and finance reports were completed. We found that in fact there was more money that could be declared and distributed to our member owners. That additional money was another $2 million.

The Board looked at all the data provided and agreed with the committee work and unanimously approved a $4 million dividend to be paid to MTM owners in March. Management will print the checks the last week of February, and distribution will begin on March 1st. As from past years, MTM management delivers as many of the checks as we can. You will see MTM Loss Control people, Megan Brown, VP of Marketing and Sales, and myself delivering checks to MTM members. And going back to years before COVID, we will try to get a picture with each delivered check.

To answer a couple of questions about the dividend, $4 million is slightly lower than the $4.5 million declared last year. Like the prior years, the dividend is actually two dividends. The first one is a loyalty dividend and goes to all members. That dividend comes somewhere between 10% and 15% of the annual premium. A second dividend is declared for shops that have had a three-year loss experience better than the company average. The idea behind this second dividend is that these are the companies that help bring the profit and the availability dividend to all members. This dividend is larger than the loyalty dividend and amounts to between 20% and 40% of the annual premium.

We do our best to have all deliveries done within three weeks, and get the money into members’ hands as soon as possible. Hopefully, the weather will cooperate and not give me too many days of driving in the snow. In the meantime, know that we are working hard on the administrative side to get all of the accounting work done to pay this dividend, and getting 934 checks issued. An interesting small statistic is that all except 16 MTM policyholders are getting a dividend check. The only reason those 16 members are not getting a check is that they have joined MTM since the dividend cutoff period of 12/31/21.

We look forward to seeing you soon, and I specifically have told many of you that delivering checks to our members is the best part of my job, and I am looking forward to hitting the road on March 1st. Please wish me good weather for the first three weeks of March.

— John