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life insurance holding company

pivotal strategies' services:  turnaround management; interim management

core proficiencies:  operational assessments and initiatives, business process reengineering, mergers and acquisitions

pivotal strategies' role:  interim CEO

company ownership:  publicly traded

existing conditions:

The holding company had grown through a number of acquisitions over a 15 year span. At its peak, the company’s assets were nearly $2 billion and its annual revenue was $200 million with business in all states except New York. After the founder was removed from office, it was discovered that the acquired companies had been poorly integrated and that financial record keeping at the company was in disarray. After the company’s auditors refused to sign off on its financial statements, the company became 3 years delinquent in its SEC filings, was delisted from the NASDAQ exchange, and was being threatened with receivership by insurance regulators. Under the pressure of its financial crisis, the company ceased writing annuity business altogether and limited its life insurance sales to one line of business. Insurance regulators demanded that the Board bring in experienced management to prevent further erosion in the company’s capital position.

remedial initiatives:

A Pivotal Strategies professional, retained by the Board as an interim CEO, planned and implemented the the following remedial initiatives:

·   Outsourcing investment management and removing high risk investments from the company’s portfolio.

·   Reducing the company’s expenses levels.

·   Selling an insurance subsidiary to boost risk based capital.

·   Reconciling all financial accounts.

·   Filing all delinquent SEC reports.

·   Restoring relationships with all relevant regulatory and rating agencies.

·   Positioning the holding company for sale.


Within a 2 year period, the company became current in its filings with the SEC and held its first shareholder meeting in 4 years. The investment portfolio was cleansed of high risk and mortgage backed investments. Clean opinions were obtained from the company’s auditors, including its first pass through Sarbanes Oxley internal controls requirements.  A ratings upgrade was obtained from A.M. Best. An auction was conducted for sale of the holding company, resulting in a successful transaction and optimizing shareholder value.

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