MAPFRE USA is reorganizing, with plans to pull out of five states and refocus its operations in others in order to strengthen its operations.
The U.S. division of Spanish insurer MAPFRE Group will shift to four regional centers and also pull out of non-core operations. Plans call for exiting the life insurance business in the U.S. and it will pursue selling its Delaware subsidiary MAPFRE Life Insurance Company.
“With the changes announced…, we are positioning the company for success through a more focused business strategy,” MAPFRE USA President and CEO Alfredo Castelo said in prepared remarks. “The strategic realignment focusing on MAPFRE’s core markets and lines of business will reinforce our market leadership position in our home state of Massachusetts and drive our profitable growth strategy in our remaining states of operation going forward.”
MAPFRE Group Antonio Huertas added that the insurer’s USA arm is “committed to achieving the necessary scale and profitability in its operations outside of Massachusetts and strongly believes that the … reorganization will accelerate the achievement of our strategic goals in the U.S. Market.”
Here’s a rundown of MAPFRE USA’s reorganization plans:
- MAPFRE will stop doing business in New York, New Jersey, Kentucky, Tennessee and Indiana. In New York, MAPFRE has hired an investment bank to pursue sale of its New York subsidiary, MAPFRE Insurance Company of New York. It is also pursuing an orderly withdrawal from the four other states, including the pursuit of replacement carrier transactions where possible. In the interim, it will continue to work with its customers and agents until the wind-down is completed.
- 11 core states have been identified where the insurer believes it can leverage its existing scale, infrastructure and independent agent network to pursue profitable growth: Massachusetts, Connecticut, Rhode Island, New Hampshire, Maine, Vermont, Ohio, California, Oregon, Washington and Idaho.
- In 3 other states – Florida, Pennsylvania and Arizona – MAPFRE USA will “reinforce the company’s underwriting and distribution foundation” before any future expansion plans.
- As of Jan. 1, 2018, MAPFRE USA will be divided into four regions: the Massachusetts/Northeast Region, East Central Region, Western Region and Puerto Rico.
MAPFRE noted that its Northeast region accounts for 67 percent of its US. business. This region includes the company’s home state of Massachusetts, and New Hampshire, Rhode Island, Vermont and Maine. Patrick McDonald, the current executive vice president for business development at MAPFRE USA will become the division’s CEO.
The East Central Region will include Ohio, Pennsylvania, Connecticut and Florda, and Greg Clark will be the division’s regional director. Headquarters are planned for Columbus, OH.
MAPFRE USA’s Western Region will be led by Regional Director Miguel Coello, with headquarters based in San Ramon, Calif. California, Arizona, Washington, Oregon and Idaho will be the included states.
MAPFRE Puerto Rico will be led by Alexis Sanchez, who is slated to become CEO of the division on Jan. 1. The division, which will maintain its own management structure, generates 15 percent of MAPFRE’s U.S. business.
The regional directors and Sanchez will report to Castelo.
Source: MAPFRE USA