Primerica, Inc. (NYSE: PRI) is a company that provides

insurance Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...

investment Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance, the purpose of investing is ...

and

financial services Financial services are the economic services provided by the finance industry, which encompasses a broad range of businesses that manage money, including credit unions, banks, credit-card companies, insurance companies, accountancy companies, ...

to middle income families in the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...

and

Canada Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by to ...

. Primerica is the parent company of National Benefit Life Insurance Company, Primerica Life, Peach Re, and Vidalia Re. Primerica acquired e-Telequote in July 2021. Primerica has been described as a multi-level marketing company. The company that would become Primerica was founded in 1981. Primerica had its

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investme ...

in 2010. Primerica's headquarters are located in

Duluth, Georgia Duluth is a city in Gwinnett County, Georgia, United States. Located north of Interstate 85, it is approximately northeast of Atlanta. As of the 2020 census, Duluth had a population of 31,873, and the United States Census Bureau estimated the ...

History

In 1980, A.L. Williams (founded in 1977) entered into a contract with

Boston Boston (), officially the City of Boston, is the state capital and most populous city of the Commonwealth of Massachusetts, as well as the cultural and financial center of the New England region of the United States. It is the 24th- mo ...

-based Massachusetts Indemnity and Life Insurance Company (MILICO), an underwriter of life insurance and a subsidiary of Santa Monica-based PennCorp Financial Services. In 1981, the company established First American National Corporation as a holding company for First American Life Insurance and First American National Securities. These companies were later renamed The A.L. Williams Corporation, A.L. Williams Life Insurance Company, and PFS Investments, Inc, respectively. In 1982, The A.L. Williams Corporation (ALWC) was listed on the Over the Counter (OTC) market under the symbol ALWC. In 1983, the company became listed on the

NASDAQ The Nasdaq Stock Market () (National Association of Securities Dealers Automated Quotations Stock Market) is an American stock exchange based in New York City. It is the most active stock trading venue in the US by volume, and ranked second ...

exchange under the same symbol. PennCorp finalized a merger agreement with American Can Company in 1983, and became its subsidiary along with MILICO. In 1986 Triangle Industries bought American Can's packaging division and the rights to the company's name. In 1987 American Can changed its name to Primerica Corporation, with

Gerald Tsai Gerald Tsai Jr. (; March 10, 1929 – July 9, 2008) was a billionaire investor and philanthropist who helped build Fidelity Investments into a mutual fund powerhouse. After starting Fidelity Investments' first publicly sold aggressive growth fund ...

as CEO, the first Chinese American to lead a member of the Dow Jones Industrials. In December 1988,

Sanford Weill Sanford I. "Sandy" Weill (; born March 16, 1933) is an American banker, financier and philanthropist. He is a former chief executive and chairman of Citigroup. He served in those positions from 1998 until October 1, 2003, and April 18, 2006, resp ...

's Commercial Credit acquired Primerica Corporation for $1.54 billion, retaining the Primerica name. On February 6, 1989, Primerica Corporation began trading on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its liste ...

. Throughout the next ten years, Primerica Corporation's affiliated companies A.L Williams, MILICO, and FANS changed their names to Primerica Financial Services, Primerica Life Insurance Company, and Primerica Financial Services Investments, respectively. In December 1993, Primerica fully acquired Travelers Insurance Corporation and adopted the name Travelers Inc., which was changed to

Travelers Group The Travelers Companies, Inc., commonly known as Travelers, is an American insurance company. It is the second-largest writer of U.S. commercial property casualty insurance, and the sixth-largest writer of U.S. personal insurance through indepen ...

the following year. Travelers Group included Primerica Financial Services,

Smith Barney Morgan Stanley Wealth Management is an American multinational financial services corporation specializing in retail brokerage. It is the wealth & asset management division of Morgan Stanley. On January 13, 2009, Morgan Stanley and Citigroup an ...

, and other financial businesses.

Joe Plumeri Joseph J. Plumeri II (born July 7, 1943) is vice chairman of the First Data Board of Directors. He was the chairman and CEO of Willis Group Holdings (Willis), a New York Stock Exchange-listed insurance broker, until July 2013. The company has ...

was Chairman and CEO of Primerica Financial Services from 1995 to 1999. In 1998, Primerica had net income of $398 million on net sales of $1.65 billion. In December 1997, Primerica announced it was going to begin offering pre-paid legal through Pre-Paid Legal Services, Inc., at the time a

subsidiary A subsidiary, subsidiary company or daughter company is a company owned or controlled by another company, which is called the parent company or holding company. Two or more subsidiaries that either belong to the same parent company or having a ...

of Travelers Group, Inc. In 1998, the U.S. Securities and Exchange Commission (SEC) censured and fined PFS Investments Inc., the securities arm for Primerica, for failure to properly supervise a group of registered representatives in

Dearborn, Michigan Dearborn is a city in Wayne County in the U.S. state of Michigan. At the 2020 census, it had a population of 109,976. Dearborn is the seventh most-populated city in Michigan and is home to the largest Muslim population in the United States per ...

. The SEC found that PFS Investments Inc. had failed to have in place effective policies and procedures to follow up adequately on three complaints received about the Dearborn registered representatives, "selling away" activities. By the date of the ruling, PFS Investments reported it had complied with the final recommendations made by the independent consultant. In 1998, Travelers Group and Citicorp merged creating

Citigroup Citigroup Inc. or Citi ( stylized as citi) is an American multinational investment bank and financial services corporation headquartered in New York City. The company was formed by the merger of banking giant Citicorp and financial conglomera ...

(). Primerica and its affiliates continued to operate as subsidiaries of Citigroup, although the Travelers insurance business was spun off in 2002.

attempted to sell Primerica in 2008, having received several bids from life insurance companies and

private equity In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a t ...

firms interested in buying. At the time the market value of the company was estimated to be $7 billion. JC Flowers & Co. LLC and Protective Life Corp began to purchase the company but the deal was canceled for undisclosed reasons. During the

COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identi ...

, in 2020, Primerica paid out $1.7 billion in death claims. This was a 15.8% increase over 2019. The financial services company ended 2021 with $900 billion in active

term life insurance Term life insurance or term assurance is life insurance that provides coverage at a fixed rate of payments for a limited period of time, the relevant term. After that period expires, coverage at the previous rate of premiums is no longer guaran ...

Initial public offering

On November 5, 2009 Citi announced that it intended to spin off Primerica through an

. The first trading occurred on April 1, 2010, priced at $15 a share the day before trading. Citi raised $320 million through the IPO. In a separate offering, private equity firm

Warburg Pincus Warburg Pincus LLC is a global private equity firm, headquartered in New York, with offices in the United States, Europe, Brazil, China, Southeast Asia and India. Warburg has been a private equity investor since 1966. The firm currently has over ...

bought a 23 percent stake in Primerica, and had the option to purchase an additional 10 percent stake from Citi. On December 19, 2011, Citigroup sold its remaining equity stake in Primerica. Primerica was listed by ''

Forbes ''Forbes'' () is an American business magazine owned by Integrated Whale Media Investments and the Forbes family. Published eight times a year, it features articles on finance, industry, investing, and marketing topics. ''Forbes'' also r ...

'' as one of "Americas 50 Most Trustworthy Financial Companies" in 2015. In July 2021, Primerica acquired e-Telequote, a health insurance marketer.

Products and business model

Primerica uses what has been described as a multi-level marketing strategy, with eleven tiers of representatives and recruiters selling financial products and services for commission. The company primarily sells

, as well as other financial services including auto and home insurance,

mutual fund A mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. The term is typically used in the United States, Canada, and India, while similar structures across the globe include the SICA ...

s, and

credit monitoring Credit report monitoring or company tracking is the monitoring of one's credit history in order to detect any suspicious activity or changes. Companies offer such service on a subscription basis, typically granting regular access to one's credit ...

. In 2010, Primerica was reported to have over 100,000 representatives selling the company's financial products, with individual earnings averaging $5,156 per year. In 2012, Primerica was the target of multiple lawsuits alleging that the company's representatives sought to profit by earning commissions after convincing Florida firefighters, teachers, and other public workers to divest from safe government-secured retirement investments to high-risk retirement products offered by Primerica. In January 2014, the company settled the case for $15.4 million.

References

Sources

Primerica
Primerica, viewed July 7, 2012
New Georgia Encyclopedia
NGE, viewed November 7, 2006

External links