Insurers Look to Acquire Asset Management Firms

As the nation's 77 million Baby Boomers get ready for retirement, insurers are increasingly acquiring asset management companies, Investment News reports.

In May, Guardian Life Insurance bought a 65% stake in RS Investments and New York Life Investment Management purchased Institutional Capital. Last year, Sentinel Asset Management, which is a subsidiary of National Life Insurance, acquired Bramwell Capital Management.

Now, Mutual of Omaha is said to be in the market, although a company spokesperson declined to comment.

While insurers expect that annuities and other types of insurance products will grow in popularity among Boomers, they also realize they will also be looking for hybrid products.

"To some extent, insurance companies, especially the ones that are mutual companies, have a little more capital and freedom to bid on these things," noted Jonathan Stern, managing director with investment banking firm Berkshire Capital Securities.

The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.