Principal Financial Group is planning to exit most of its business of selling life-insurance and annuities to American consumers, becoming the latest household-name life insurer to get out of these products.
Iowa-based Principal Financial said Monday that it is discontinuing sales of all U.S. retail “fixed annuities” and much of its consumer life-insurance business, and would pursue strategic alternatives for the policies and contracts it has on its books.
It is considering potential divestiture of about $25 billion of reserves related to its overall annuities and life-insurance businesses.
The company said the initiatives would regroup Principal around U.S. and international retirement services, life insurance and other financial products sold as part of employers’ benefits programs and asset management. The moves are the result of a strategic review initiated in February.
Principal follows on the heels of numerous rivals shedding life-insurance and annuity businesses. U.S. life insurers have been struggling with ultralow interest rates and a sluggish sales environment for the large middle-income market.