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History: may I interest you in a burial policy? Founded in 1863 by a group of New York City businessmen, the Metropolitan Life Insurance Company (MetLife) primarily sold life insurance to the middle class in its early years. When sales fell in the 1870s, MetLife president Joseph F. Knapp, taking his lead from English insurance agents, began aggressively selling burial policies on a door-to-door basis to industrial workers. Metropolitan became a mutual company (owned by policyholders) in 1915, and began offering group insurance two years later. Dropping industrial insurance in 1964, MetLife began offering automobile and homeowners insurance in 1974. Diversification efforts in the 1980s included the purchase of Century 21 Real Estate, Allstate's group life and health business, and the annuities segment of the failed Baldwin United Co., with expansion into Spain and Taiwan in 1988. Top of the line In response to the economic downturn of the early 1990s, MetLife cut costs, trimmed jobs, and began renewed emphasis on insurance, adding new products including long-term care insurance. MetLife gained 30,000 policyholders from its 1992 merger with United Mutual Life Insurance, New York's only African-American life insurance company. In 1995 the company merged with Boston-based New England Mutual, expanding its clientele to include the more-profitable realm of upper-income customers, and making it the No. 1 life insurance provider in the U.S. We're going public! With $351 billion in assets, and no less than $1.7 trillion in insurance in force, MetLife had built one of the most solid reputations in insurance. The company, however, envisioned a different future. CEO Robert H. Benmosche told The Los Angeles Times: "We believe a bank would get instant recognition across the United States with the name MetLife Bank." As acquisitions of banks don't come cheaply, MetLife announced in November 1999 its plans to "demutualize," or to convert from a mutual company (one owned by the policy holders) to a publicly traded company. At the time of the announcement, some industry watchers suggested that the move to go public was motivated mostly by high-level executives seeking instant riches. One compensation specialist told the New York Times that MetLife's CEO stood to gain $100 million from the plan. MetLife dismissed such claims. A company spokesperson remarked: "Our first priority is to make sure that policyholders get 100 percent of the value of the company. And there are no plans to reward management until that takes place." MetLife went public in mid-2000, selling approximately one-third of the company, and subsequently formed a banking unit. Although MetLife's demutualization plan had won praise for its straightforward nature, some had criticized the deal. Lou Richman, editor of Consumer Reports sighed: "A very valuable and venerable institution is disappearing from the landscape for consumers." Hacking away Turning to the public markets, however, was not MetLife's only means of raising capital. In summer 1998, MetLife sold its Canadian operations and its commercial finance unit for $1.2 billion and $1 billion respectively. On an even harsher note, the company announced in September 1998 that it would cut 10 percent of its administrative workforce - a loss of 1900 jobs. In mid-2000, however, it announced upcoming expansions. We're getting sued! Like most insurance companies, MetLife has been up to its ears in litigation troubles. In July 1998, San Mateo County filed a class-action suit on behalf of senior citizens. Numerous clients claimed that Metlife and Transamerica Corp. had coerced them into applying for loans that carried excessive fees and unfair terms. MetLife's worries continued in October 1998, when federal prosecutors informed the company that it was on the verge of indictment for fraudulent sales practices in Florida. Without admitting wrongdoing, MetLife settled the matter when it paid a $25 million civil penalty and $186,000 in investigative costs the following month. In August 1999, Met Life paid out $1.7 billion in order to settle several lawsuits alleging that Met Life agents had misrepresented their policies to customers. Met Life admitted to no wrongdoing in the settlements that covered six million customers, however. MetLife's legal problems continued in 2000. In April, the American Medical Association filed a class-action lawsuit charging the insurance agency with breach of contract, and with deceptive business practices, among other wrongdoings. A month later, the Kennedy family sued the firm over MetLife's treatment of the mortgage of a Kennedy-owned property. Expansion In August 1999, Met Life purchased GenAmerica Corp. for $1.2 billion in cash. The catch to the deal was that one of GenAmerica's constituent companies, General American Life Insurance, was suffering through a liquidity crisis. The purchase remained desirable because, aside from General American's troubled funding business, the company was fairly strong and boasted $29 billion in assets. Furthermore, the company acquired Economy Fire & Casualty Group in summer 1999, while it also expanded internationally.
MetLife's Snoopy-adorned Web site, www.metlife.com, offers extensive career information on careers in sales and the company's two year management associate program. The site further includes listings of company-sponsored career seminars, descriptions of various job functions, and an online application process. Regarding the general admissions process, one insider tells us: "I don't think of them [the interviewers] as being unduly harsh." On the sales end, candidates should expect a psychological profile followed by interviews with the manager of the local office. For management positions, candidates can expect two to three rounds of up to four interviews.
Culture: moving faster One of our contacts at MetLife muses about the corporate culture: "It is looking to change, mostly around the initiative to go public later this year. The new CEO, Bob Benmosche, envisions taking MetLife from a staid, traditional firm to one that is faster-moving and more competitive. I'd say it's an exciting time to be here." Another notes that the announcement to go public "has created some turmoil, but may also offer some exciting possibilities." A different informant believes "working at MetLife is great and there is great opportunity in it if you like to work." Are there any downsides to the culture? "Some managers are tough," grumbles one insider. The pros and cons of sales "If earning large amounts of money is your object," one of our MetLife sources tells us, "then a career in Sales might be the way to go." Another contact agrees, revealing that "the sales organization has allowed me to build my business from the ground up. The compensation is great and I set my own hours and dress to satisfy my clients." Still another sales insider raves: "I enjoy the flexibility. [I] control my own destiny, set up my own schedule, and do what I want to do when I want to do it." The same contact, however, strongly cautions: "it took me a few years of frustration and rejection to get to a point where people began to trust what I said and believe that I had their best interests at heart...if you choose a career in insurance, be ready for rejection." Dress: A dim view of casual MetLifers generally indicate that the company is moving towards casual, although one insider explains: "I try to be casual, but the company takes a very dim view on too casual." One of our contacts in New York tells us that "Home Office (One Madison) is suits and ties, while the outer offices...are business casual during the week, jeans on Fridays (saves on dry cleaning!)." "Many vacation days, not many perks" "From what I have seen," one MetLifer tells us, "the pay is competitive and the perks are pretty good." Another rather cryptic insider notes "many vacation days, not many perks." The one thing that all MetLife insiders can agree on is benefits. A former MetLife employee tells us: "The benefits were wonderful - 401K, good health plan, dental, all the rest." Another benefit that draws praise is tuition reimbursements. Diversity: getting better Most respondents give positive reviews on MetLife's diversity. "The company absolutely practices EEO," says one. Another informant testifies, "I would have to say that the top officers in the company are mostly men, but there are many very good opportunities for women all over the company."
Lisa M. Weber Human Resources
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