Hartford Life Insurance Company of Simsbury, Conn., is looking to the person who helped launch its proprietary mutual fund family to increase sales of the firm's funds and annuities to 401(k) plans.
David Levenson, 33, who has been vice president and director of the Hartford Mutual Funds since 1995, was given the additional title of director of the firm's 401(k) retirement plan sales in September.
The firm has only sold group annuities in its 401(k)s. But in the first quarter of 2000, Hartford is introducing a 401(k) product composed of its 12 mutual funds, seven of which are in the first quartile of their peer groups, Levenson said.
"If you look at our funds, they lend themselves perfectly to a 401(k) type of investment because they are conservative, long-term oriented portfolios," Levenson said. "They are always fully invested and they are true to style."
Levenson said he was given his new responsibilities largely because of his strong relationships with broker/dealer firms.
"Through those relationships hopefully we'll be able to continue to leverage the product line," he said. "We have the annuities, we have the mutual funds. They're doing well. So, now for the 401(k). It's time to build its presence in the broker/dealer universe."
Hartford's sales in the 401(k) market have been growing. Through the first three quarters of 1999, Hartford had a 129 percent increase in sales of 401(k) plans compared with the same period in 1998, Levenson said. November, 1999 was a record month for sales, he said.
A major part of Hartford's effort in the defined contribution market has been its commitment of personnel to the task, Levenson said. Thirty-three Hartford 401(k) pension specialists work with 100 wholesalers from the firm's subsidiary, PLANCO of Paoli, Pa., to pitch the product to broker/dealers.
"Given the complexity of the 401(k) product, we have, on top of the 100 [PLANCO] wholesalers, an additional group of 33 individuals who will work both with the wholesalers as well as the brokers and plan sponsors to really help close business," said Levenson. "It's one of the largest 401(k) specialist forces of anyone."
Hartford is targeting businesses that have 50 to 250 employees in the defined contribution market. Hartford's 401(k) plans average 80 employees and $1 million, Levenson said.
The firm has a four-pronged sales pitch to brokers, Levenson said. Its components are the firm's strong brand, the quality money management of its funds, its distribution strength through PLANCO (which has been an industry leader in annuity sales) and its service, he said.
"Generally, you will win business based upon your relationship with the plan sponsor," Levenson said. "You will generally lose business because of poor service. The number one reason 401(k) plan sponsors change providers is service."
To improve its service, Hartford recently spent "tens of millions of dollars" to upgrade its computer systems. It also pays attention to details. For example, a group of 12 employees accompany brokers on presentations to 401(k) plan participants, Levenson said. He plans to build this group further, he said.
"If a firm is very interested in building revenue, no one has the muscle power that we do to get that done," Levenson said.