Prudential Spends $2.35 Billion to Make Financial Wellness Boost Growth

Charles Lowrey, who became Prudential’s chief executive officer in December 2018, said in a statement about the Assurance IQ deal that Prudential looks forward to the Assurance IQ team helping Prudential accelerate “the strategy and growth potential of Prudential’s financial wellness businesses, bringing us closer to more people across the entire socio-economic spectrum to better serve the full picture of their needs.”

In the future, the Assurance IQ system will offer Prudential products along with other companies’ products, the companies say.

Rowell and Paulus

Michael Rowell and Michael Paulus, the Assurance IQ co-founders, plan to stay with Prudential after the deal is completed, the companies say.

Rowell, Assurance IQ’s CEO, ran eFinancial for Fidelity Life Association of Chicago for about 14 years. He and Paulus, who came out of the venture capital industry, started Assurance IQ in 2016.

Analysts’ View

Analysts from S&P Global Ratings say the deal is different from most of the life insurance company deals that S&P rates.

“Instead of acquiring a block of business for immediate growth, PRU [Prudential] is making an investment in technological capabilities, digital distribution channels, and a low capital-intensive fee-based business,” S&P says in a comment.

Whether a hybrid digital-agent approach will increase growth is uncertain, but “an investment in such a channel may provide a longer term edge to a life insurer,” S&P says

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