Alyssa Lane
EMC Insurance Companies (EMC) is among the top 60 property and casualty insurance organizations in the United States. In September 2022, EMC announced that it would be exiting the reinsurance business, leading to concerns about the company's future. EMC's decision to exit reinsurance will result in the loss of 65 jobs, with the company exploring options for the management and/or runoff of its existing reinsurance business. Despite this, EMC maintains a strong presence in the insurance industry, offering commercial property, casualty, and life insurance products and services across the country.
| Characteristics | Values |
|---|---|
| Reason for exiting reinsurance business | To position the company for the future and the achievement of its strategic plans and goals |
| Number of employees losing their jobs | 65 |
| Date of job cuts | Starting Jan. 3, 2023 |
| Annual revenue from reinsurance | $180 million |
| Percentage of total business that is reinsurance | 10% |
| Year EMC Insurance was founded | 1911 |
| Number of local offices | 3 |
| Number of employees | 2,200-2,500 |
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What You'll Learn
EMC Insurance is exiting the reinsurance business
EMC Insurance Companies (EMC) is exiting the reinsurance business. On September 27, 2022, EMC announced that it had made the difficult decision to exit the assumed reinsurance business conducted through EMC Reinsurance Company (EMC Re). The company received about $180 million in annual premiums from reinsurance, representing approximately 10% of its total business.
EMC Reinsurance provides both facultative and treaty reinsurance for insurance providers. Reinsurance is a hedging technique where one company sells a bundle of policies to another company, spreading the risk from potentially expensive customers. EMC's exit from the reinsurance business is part of a strategic move to focus on its core insurance products distributed through independent agents, including commercial property, casualty lines, bonds, and life insurance.
EMC plans to honor all existing terms and conditions of treaties in effect. However, EMC Re will not entertain any new business or renewals effective September 27, 2022. The company is currently exploring options for the management and/or runoff of its existing reinsurance business.
The decision to exit the reinsurance business was challenging for EMC, but it was deemed necessary to position the company for future success and the achievement of its strategic goals. Unfortunately, this transition will result in job losses for 65 employees, with layoffs starting on January 3, 2023.
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EMC Insurance is cutting 65 jobs
EMC Insurance Companies (EMC) is a top 60 insurance organization in the United States, with over 2,500 employees. The company, which was founded in Des Moines 110 years ago, recently announced that it would be exiting the reinsurance business. As a result of this decision, EMC will be cutting 65 jobs starting on January 3, 2023.
EMC Reinsurance provides both facultative and treaty reinsurance for insurance providers. Reinsurance is a hedging technique in which one company sells a bundle of policies to another company, spreading the risk from potentially expensive customers. The buyer receives the business at a discount, betting that the customers' premiums will outweigh any eventual costs. EMC received about $180 million in annual premiums from reinsurance, representing about 10% of the company's total business.
The job cuts at EMC come after several other financial industry employers in the Des Moines metro area announced layoffs or plans to leave certain markets. For example, Wells Fargo made 10 rounds of layoffs from April to September 2022, and Principal Financial Group laid off 55 workers after announcing its plan to exit the fixed retail annuity and commercial life insurance lines.
EMC's decision to exit the reinsurance business and cut jobs is part of a strategic move to position the company for the future and achieve its long-term plans and goals. According to CEO Scott Jean, "Options for the management and/or runoff of existing reinsurance business are currently being explored." EMC plans to focus on its core insurance products, including commercial property/casualty lines, bonds, and life insurance written through EMC National Life Company.
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EMC Insurance is exploring options for existing reinsurance business
EMC Insurance Companies (EMC) has announced that it is exiting the assumed reinsurance business conducted through EMC Reinsurance Company (EMC Re). The company will no longer entertain any new business or renewals in this segment as of September 27, 2022. EMC Insurance is exploring options for the management and/or runoff of its existing reinsurance business.
EMC Reinsurance provides both facultative and treaty reinsurance for insurance providers. Reinsurance is a hedging technique where one company sells a bundle of policies to another company, spreading the risk from potentially expensive customers. The buyer purchases the business at a discount, betting that the customers are not as risky as assumed and that their premiums will cover any costs.
EMC's exit from the reinsurance business is part of a strategic move to focus on its core insurance products distributed through independent agents. These products include commercial property/casualty lines, bonds, and life insurance written through EMC National Life Company. The company plans to leverage its strong technology and data tools to empower team members and provide a human touch to its services.
EMC Insurance has a long history, dating back to 1911 when it was established to offer workers' compensation protection in Iowa. Over the years, it has expanded its operations and now offers a range of property and casualty insurance products and services across the United States. The company is among the top 60 property and casualty insurance organizations in the country based on net written premiums.
EMC's exit from the reinsurance business has resulted in planned job cuts, with 65 employees expected to lose their jobs in 2023. The company's decision was not taken lightly, as it aims to position EMC for future success and the achievement of its strategic goals. Despite the challenges, EMC remains committed to its core insurance business and serving its customers through its network of independent agents.
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EMC Insurance's future plans and goals
EMC Insurance is not going out of business, but the company has recently announced that it will be exiting the reinsurance business and cutting 65 jobs in waves, starting from January 3, 2023. This move is intended to position the company for the future and help it achieve its strategic plans and goals.
EMC is committed to building a diverse and inclusive team that represents the customers it serves. The company believes that diversity and inclusion are essential to everything it does, from talent acquisition to ongoing training. By valuing differing perspectives and celebrating people of diverse backgrounds, EMC aims to make better decisions and create more fulfilling experiences.
In terms of specific initiatives, EMC has been working to strengthen its partnerships, enhance its services, and improve its financial results. The company has also been investing in data and technology to make doing business with them easier, faster, and more efficient. Additionally, EMC has been recognised for its commitment to corporate sustainability and responsibility, demonstrating that it is more than just an insurance company.
EMC Insurance also has plans to continue growing and thriving for centuries to come. The company intends to uphold its long-standing presence in downtown Des Moines, Iowa, where it operates three local offices, including the 20-story "Vodka" building. EMC had previously announced plans to expand its downtown office space, but these plans were put on hold during the COVID-19 pandemic, with the space being turned into a public park instead.
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EMC Insurance's presence in Des Moines
EMC Insurance is headquartered in Des Moines, Iowa, and has been a prominent presence in the city for over 110 years. The company has approximately 2,200 employees and is among the top 60 property and casualty insurance organisations in the country based on net written premiums.
EMC Insurance was founded in 1911 as the Employers Mutual Casualty Company (EMCC) to write workers' compensation protection in Iowa. Today, it provides commercial property/casualty lines, bonds, and life insurance products and services throughout the United States. The company operates three local offices in Des Moines, including the 20-story "Vodka" building, so-called for its resemblance to a bottle of Absolut vodka. In 2017, EMC opened a $40 million office at Eighth and Walnut Streets.
EMC Insurance has been recognised for its commitment to the Des Moines community. Since its establishment in 1989, the EMC Insurance Foundation has donated over $33 million to charitable causes. The company has also been recognised as the winner of the Best Technology Company Culture of the Year award at the Technology Association of Iowa's Prometheus Awards.
In September 2022, EMC Insurance announced that it would be exiting the reinsurance business, resulting in the loss of 65 jobs. This move was made to position the company for the future and achieve its strategic plans and goals, according to CEO Scott Jean. Despite this setback, EMC Insurance remains a strong and stable company with a long history of success.
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Frequently asked questions
No, EMC Insurance is not going out of business. However, on September 27, 2022, the company announced that it would be exiting the reinsurance business and cutting 65 jobs.
Reinsurance is a hedging technique in which one company sells a bundle of policies to another company, spreading the risk from potentially expensive customers.
EMC Insurance has stated that this move is necessary to position the company for the future and the achievement of its strategic plans and goals.
Reinsurance represented about 10% of the company's total business, with EMC receiving about $180 million in annual premiums from it.
The job cuts will take place in waves, starting on January 3, 2023.
