Mutual of Omaha is ending life insurance and annuity sales by agents and brokers in New York state and closing four sales offices of its Companion Life Insurance Co. there at the end of March.
The move will cost 65 agents — 30 of them full-time and the others part-time, semi-retired or inactive — their contracts with Mutual, plus the jobs of 13 managers and other employees at offices in Syracuse, Rye, Latham and New York City, Mutual spokesman Jim Nolan said Monday.
“This is a response to unique conditions in the state of New York,” Nolan said, a business decision based on an analysis of sales, market share, profitability, costs and state regulatory factors.
The change does not affect existing Companion life insurance policies and annuities or the other 100 or so Mutual insurance agencies and their 1,800 agents around the country, Nolan said.
Nor does it affect group sales offices at Companion’s headquarters in Hauppauge, Long Island, and in Manhattan and Pittsford.
New York’s life insurance regulations are different enough to require Companion as a separate life insurance subsidiary alongside the United of Omaha affiliate that sells life insurance in the other states, Nolan said.
At the closing sales offices, he said, “We’re working individually with agents on the impact of this move on their business.” Options include becoming independent brokers who can sell other companies’ products rather than being “captive” and selling only Mutual products.
The employees will receive severance benefits, Nolan said.
Companion will continue selling life insurance and annuities in New York through direct mail and online, Nolan said, as well as group sales. Mutual will continue sales in New York of other products, including individual and group disability, long-term care, dental and supplemental health insurance, plus financial plans and investments.
He said the New York life insurance business is a “small percentage” of the company’s overall life and annuity sales. Companion Life has not been a market leader in New York in those lines of business, he said.