How Nationwide Evolved from a P&C Insurer

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

But now he’s breaking the mold of what he’s been known for. By rapidly growing its corporate solutions arm in recent years, Nationwide can now present itself as a full-spectrum financial services provider.

Its diverse financial services business was a major driver of Nationwide’s performance in 2022, helping the company buffer against inflation and other economic headwinds. The Columbus-based firm reported a record $57 billion in sales last year. Its net operating income was $1.4 billion.

JJ Perez (pictured), president of corporate financial solutions for Nationwide, attributes his team’s tremendous growth to years of foresight and planning.

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

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

Economic uncertainty an ‘opportunity’

Businesses today face significant economic uncertainty. Inflation and interest rates have risen to their highest level in the past year.

But Nationwide is confident that its range of corporate financial services solutions can help leaders better position their organizations against volatility.

“We believe Nationwide is best positioned to partner with [organizations] and help them manage that uncertainty,” Pérez said. “When different businesses are dealing with a lot of volatility, for example, are they interested in deferred compensation for key executives?

“I think all companies take the retention of key talent within their team very seriously. We are helping clients understand that while problems exist on a day-to-day basis, they can get worse if key talent is lost.”

“There are headwinds and opportunities to continue to serve clients and help them take some of the volatility off their list of worries, so they can focus on growing their business,” Perez said.

The genesis of Nationwide’s corporate financial solutions

What would it look like today if Nationwide remained a pure property and casualty player?

This was the reflex, according to Perez, that prompted Nationwide to develop smaller segments outside of its core P&C life offerings all those years ago. Prior to his current role, Perez was vice president of finance at Nationwide.

“We had a couple of units that were in other core businesses, like corporate-owned life insurance, which started in 1997,” he said. “Our specialty insurance business, which includes accident and health benefits, has moved several times, but has always been alongside other core businesses.”

These were smaller segments that needed more oxygen, but Nationwide also had newer businesses that they wanted to get going, like securities-backed lending (launched in 2019) and pension risk transfer (launched in 2020). .

Since it was formally established in 2022, Corporate Solutions has become the fastest growing business segment in the Nationwide company, exceeding annual goals to achieve 133% growth by 2022.

The portfolio comprised of four businesses that serve small, medium and large organizations, as well as the main brokers and intermediaries in those markets:

• Business Solutions (NBSG)
• Securities-backed loans
• specialty insurance
• Pension risk transfer

“We want to use Nationwide’s core competencies to help serve our customers in more capacities,” Perez said. “This is how we think about the portfolio and what might be next.”

How does Nationwide Corporate Solutions plan to grow?

Pérez has highlighted a dual path of growth for the corporate solutions team.

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

Diversification means the team needs to scan the current environment and take a closer look at companies from a “risk and innovation perspective.”

Perez said they are looking in “adjacent markets” for spaces that corporate solutions can confidently enter and see a “9 out of 10 success rate.”

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

What do you think about the growth of Nationwide’s corporate solutions portfolio? Let us know in the comments.