Prudential Financial P&C Terminates 200 Independent Agents, Goes Captive
Prudential Financial's largest property/casualty subsidiary, Prudential Property and Casualty Insurance Co. (PRUPAC), terminated the contracts it had with 200 independent agencies across the country earlier this month in a move to focus its retail distribution on captive agents.
Prudential began selling P&C PLs as an additional product line to be sold by their L&H-only captive agents. It became clear that L&H captive agents can't and don't like to sell P&C, so Prudential moved to hiring and training P&C-only captives in the 1980's. Taking a queue from their number one L&H rival MetLife, Prudential converted to the IA system in the mid-to-late 1990's in hopes of better meeting their P&C projections. The largest portion of Prudential 's small IA force is in PA, CA and MI.
The roll-off is the best way in Prudential 's view of moving out of the P&C PL IA system, preserving IA's ownership and doing so with fewer complications. The move does not mean necessarily that Prudential is swearing off P&C PLs.
As most already know, Prudential has been looking for a carrier buyer for their P&C PL book for a number of months. A brief item in Insurance Journal (4/18/03) notes that PRUPAC lost $134.5 million in 2003, and quotes a company spokesman as saying its parent is considering selling the business outright. Last month, Nationwide Mutual Insurance Co. agreed to purchase THI Holdings, Inc., the domestic, non-standard auto business of Prudential Financial, Inc. marketed under the Titan Insurance Co. and Victoria Insurance Group brands.
What It Means to Agents: As a participating member in the PIA-CCEO, Prudential provided a copy of the FAQs outline that has been sent to all their IAs. This is available from Pat Borowski firstname.lastname@example.org of PIA National upon request by affiliates that have received calls from affected members or the affected PIA agents directly.