Massachusetts Mutual Life Insurance, known affectionately as MassMutual, brings a multitude of financial services to its membership base. A leading US mutual life insurer, the firm provides life policies, annuities, money management, and retirement planning to individuals and businesses in the US and abroad. Founded in 1851, MassMutual also offers disability income insurance, long-term care insurance, structured settlement annuities, and trust services. Its subsidiaries include OppenheimerFunds (mutual funds), Baring Asset Management (international investment), and Babson Capital Management (investor services) with its Cornerstone Real Estate Advisors (real estate investment management) subsidiary.
In addition to MassMutual's US operations, the MassMutual International division has established subsidiaries in Asia, Europe, and South America, where it focuses on new product development and broadened distribution. The majority of international sales come from products or channels developed within the last few years.
Sales & Marketing
MassMutual distributes its products through a network of more than 5,200 affiliated sales representatives and financial advisors.
MassMutual's strategy of positioning its insurance operations and asset management businesses to provide diversified sources of growth and earnings continues to serve it well. In 2011 MassMutual achieved more than $11 billion in surplus, the highest level in its history, despite operating in economically difficult times. The company's surplus, in fact, has averaged 10% growth since 1996. Its total assets grew by 5% in 2011, to $148.6 billion.
In 2011 the company reported solid profitability with statutory net gain from operations of $686 million and net income of $459 million. Its results were lower by 23% than in 2010, however, due to lower long-term interest rates that resulted in higher variable annuity reserves for product guarantees. Factors contributing positively to its earnings included higher net investment income and asset-based fees, along with reductions in operating expenses and additional earnings and capital growth from its international insurance businesses.
Like so many other insurance firms, MassMutual (sometimes known as MassMutual Financial Group) hopped on the financial services bandwagon to expand its product range. However, its management and policyholders have repeatedly reaffirmed their intention to keep MassMutual a mutual company despite the efforts of some policyholders. Also, the company doesn't seem too eager to throw out either the insurance baby or the bathwater -- it has also reaffirmed its commitment to good old whole life insurance products and retirement income products.
Mergers & Acquisitions
To expand its core operations, MassMutual acquired The Hartford Financial Services Group's retirement plans business for $400 million in early 2013. The deal builds on record growth within the company's retirement operations, doubling the division's coverage to some 3 million members and expanding its geographic reach.
Along with investment partner Cerberus, MassMutual acquired troubled reinsurance firm Scottish Re in 2011. Scottish Re services existing life insurance policies but does not write new policies. – less