How Nationwide advanced from a P&C insurer

For practically 100 years, Nationwide has firmly established itself as one of many nation’s foremost property and casualty (P&C) insurers.

But it’s now breaking the mould of what it has been identified for. By quickly rising its company options arm up to now few years, Nationwide can now invoice itself as a full-spectrum monetary providers supplier.

Its various monetary providers enterprise was a major driver of Nationwide’s efficiency in 2022, serving to the corporate buffer inflation and different financial headwinds. The Columbus-based agency reported a document $57 billion in gross sales final 12 months. Its internet working earnings was $1.4 billion.

JJ Perez (pictured), president of economic company options at Nationwide, credit the large progress of his group to years of forward-looking and planning.

“Nationwide corporate solutions really took off in 1997 or 1998, when we took that component of our business public. At that point, our P&C business was much bigger than the financial services business,” he advised Insurance Business.

“Fast forward, and now the financial services business is bigger than our property and casualty business.”

Economic uncertainty an ‘opportunity’

Companies are going through vital financial uncertainty in the present day. Inflation and rates of interest have risen to their highest over the previous 12 months.

But Nationwide is assured that its vary of company monetary providers options might help leaders place their organizations higher in opposition to volatility.

“Our belief is that Nationwide is better positioned to partner with [organizations] and help them manage that uncertainty,” Perez mentioned. “When totally different companies are coping with numerous the volatility, for instance, are they excited about deferred compensation for key executives?

“I do think every business takes retaining key talent within their team very seriously. We’re helping clients understand that though there are issues on a day-to-day basis, those can be exacerbated if you lose key talent.”

“There are both headwinds and opportunities to continue serving clients and help take some of the volatility off their list of concerns, to let them focus on growing their business,” Perez mentioned.

The genesis of Nationwide monetary company options

What would it not appear to be in the present day if Nationwide remained a pure property and casualty participant?

This was the reflection, in keeping with Perez, that spurred Nationwide to develop smaller segments outdoors of its core life insurance coverage P&C choices all these years in the past. Prior to his present position, Perez was a vice chairman in finance at Nationwide.

“We had a couple of units that were in other core businesses, such as corporate owned life insurance, which was started in 1997,” he mentioned. “Our specialty insurance business, which is includes accident and health benefits, had been moved around a few times, but they’ve always been sitting next to some other core businesses.”

These have been smaller segments that wanted extra oxygen, however Nationwide additionally had newer companies that they wished to get off the bottom, corresponding to securities-backed lending (which launched 2019) and pension danger switch (launched in 2020).

Since it was formally established in 2022, company options has grow to be the quickest rising enterprise section within the Nationwide enterprise, surpassing annual objectives to ship 133% progress in 2022.

The portfolio composed of 4 companies that serve small, medium, and enormous organizations, in addition to prime brokers and intermediaries in these markets:

• Business options (NBSG) 
• Securities-backed lending
• Specialty insurance coverage 
• Pension danger switch

“We want to use the core competencies of Nationwide to help serve our customers in more capacities,” Perez mentioned. “That’s how we think about the portfolio and what could be next.”

How does Nationwide company options plan to develop?

Perez has highlighted a twin path of progress for the company options group.

“We’re continuing to expand our capabilities and our solutions to serve more customers within each business,” he mentioned. “But we’re also thinking about what could be next. We’ve developed a team, and within a large, diversified financial services company, it’s always fun to develop a new muscle.”

Branching out means the group must scan the present surroundings and look extra carefully at corporations from a “venture and innovation perspective.”

Perez mentioned they’re “adjacent markets” for areas that company options can confidently enter and see a “nine of 10 success rate.”

“I won’t say what exactly is next, but some of the things that we’ve looked at are the most interesting to me. They’re the ones where competitors are doing things that we don’t currently do,” he added.

What are your ideas on the expansion of Nationwide’s company options portfolio? Let us know within the feedback.