The Hartford's surprise exit from several key businesses is still making waves in the advice industry. The latest news: Edward Jones has ceased selling the carrier's life insurance and annuities.
The Hartford Financial Services Group Inc.'s announcement that it is restructuring its business is less than a week old. But one of the carrier's major distributors has already decided to hold off on selling the company's life and annuity products for now.
Edward D. Jones & Co. LP on Friday said it will suspend sales of Hartford's life insurance product until the broker-dealer receives further details on how the insurer will proceed with its structural changes, Merry Mosbacher, a principal in Edward Jones' insurance marketing unit, confirmed. She also said the B-D is waiting to see what The Hartford's pullback means for advisers and clients.
The insurer last week announced a major restructuring wherein it will run off its individual annuity business, ceasing sales after April 27. The Hartford also said it will sell its individual-life business, as well as its broker-dealer, Woodbury Financial Services Inc., and its retirement plan business.
The Hartford is one of the biggest sellers of life insurance at Edward Jones, and the firm is a “significant distributor” for the insurer, Ms. Mosbacher said.
News of the insurer's new direction caught executives at the broker-dealer off guard, as there was no warning about the restructuring. The announcement also was issued during a week when many Edward Jones executives were traveling.
"There was no notice: We didn't have any knowledge of this, and whenever there's news on a product partner and it creates an amount of uncertainty for us, our position is to stop sales,” Ms. Mosbacher added.
Edward Jones last Wednesday also decided to suspend sales of Hartford's annuities.
"We've been in close contact with our major distributors and are addressing their questions. During this time of transition at The Hartford, we remain focused on supporting the needs of financial advisors and their clients," said Michael Gregg, head of The Hartford's Strategic Markets unit.
Not all of Hartford's broker-dealer partners are walking away from the carrier's life insurance products, however. Raymond James Financial Inc. is still selling the insurer's coverage, leaving the decisions up to advisers.
“There are situations that call for underwriting expertise, such as cancer survivors, so we still want to be able to use them,” said Jim Swink, vice president of Raymond James Insurance Group.
