UnumProvident Corp. has replaced J. Harold Chandler, its chairman, president and chief executive officer.
Two outside directors, C. William Pollard and Lawrence Pugh, have taken over as co-chairmen.
Thomas Watjen, who was the companys chief operating officer, is now the interim president and CEO, and a search committee is looking for a permanent CEO.
The management change “was not driven by any specific event,” Pugh says.
But UnumProvident is hoping the change will help the company improve its financial position, Pugh adds.
Chandler, who started with the UnumProvident organization in 1993, as chairman of Provident Companies Inc., Chattanooga, Tenn., its current base, used acquisitions to turn Provident into UnumProvident, the biggest U.S. disability insurer.
Since Provident merged with a major competitor, UNUM Corp., Portland, Maine, in 1999, the combined company has reported uneven profits and come under fire for what some say is its aggressive approach to handling claims. This winter, talks with the U.S. Securities and Exchange Commission about reporting of problems with low-rated securities led to the restatement of three years of earnings.
UnumProvident has resolved the SEC concerns and will soon be able to carry out long-delayed plans to raise capital, executives say.
At the same time, “were trying to step up the levels of communication,” Watjen says.
The company is using its Web site and conference calls to explain the recent management changes to producers, a spokesman says.
Disability insurance brokers interviewed report that UnumProvident serves them and their customers about as well as competitors do, but they say they want the company to improve its public image and its capital base.
“The 60 Minutes stories dont do Unum any favors,” says Steve Walton, a Salt Lake City broker.
Greg Albin, a Dublin, Calif., broker, says a disability insurer needs strong finances because pricing long-term disability policies is difficult.
“The claims can go 20 or 30 years,” Albin says.
Reproduced from National Underwriter Edition, April 7, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.