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Gregor Watt
MetLife looking to be a world power
MetLife is scrapping the Alico brand and launching a number of new products as it focuses on international growth following its acquisition of Alico.
The £10.8bn deal, which completed this week, means the combined business will be in 60 countries with 90 million customers.
The MetLife business is already one of the biggest insurers in the US. UK managing director Grinstead says the focus is very much on international growth, with the UK of particular importance. He says: “We really will be very much focused as an international business. We regard international as a very powerful growth engine and we are particularly excited by the opportunities in the UK.”
UK sales in 2010 have already far exceeded those for the whole of 2009. Grinstead says there has been a consistently strong demand for unit-linked guarantees in retirement income.
MetLife’s third-quarter results show revenues for Europe, the Middle East and India up by 7 per cent (11 per cent on a constant currency basis) on the back of strong growth in India and increased demand for variable annuities in Europe.
Grinstead says there will be several changes to the new enlarged company. The Alico brand is to be dropped for the UK wealth management business and the range of products from the two businesses will be streamlined. The range of guaranteed income products from MetLife will be complemented by Alico’s range of guided architecture investment products.
He says: “Where I think we can really compete is by bringing a combination of guaranteed solutions and guided architecture together, all in one package.”
To prevent any confusion, the Select Portfolio offered by Alico is to be withdrawn temporarily before being relaunched.
Grinstead says: “We did not want confusion in the market place by having two competing product categories. That means we will be looking to bring out a new set of products which are aligned, which will bring together the guaranteed solutions that MetLife has been very much focused on and the guided architecture range which Alico has been particularly known for. As a transition, the products which are currently in the market under Select will not be available.”
MetLife will also launch two new products in the next few months - a maximum investment plan and a new protected growth bond.
Grinstead says the Mip should interest clients affected by the lower lifetime pension contribution cap of £1.5m.
The protected growth bond will offer a guarantee of 80 per cent of the highest-ever unit value, with the guarantee available on a daily basis.
He says: “It enables clients to take full advantage of the stockmarket, hopefully take advantage of a recovery in the stockmarket, while knowing that their growth is being protected on a daily basis.”
The new company will have a combined broker sales team of 60 and will allow the company to expand its regional presence in the UK. The Alico management team is going to be fully integrated into the new enlarged business.
Grinstead will continue to head the UK retirement business for MetLife, with Dan DeKeizer leading the bulk annuity business. Former Alico UK CEO Mike Kirsh will lead MetLife’s protection business, as well as spearheading its plans to expand into the European wealth management market.
Grinstead says: “It is very much as growth story. We are not anticipating any redundancies in the salesforces, in fact, we expect to be recruiting a number of people over the next six months as well.
“In terms of the management teams we have pulled together, we have taken the opportunity to strengthen the number of regions we have got and enhance our national account coverage.”
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