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Harleysville CEO Briefs PIA on Merger with Nationwide

Michael Browne, president and CEO of Harleysville Mutual Insurance Co., participated in an informational conference call with PIA to address Harleysville's planned merger with Nationwide....
October 18, 2011

Michael Browne, president and CEO of Harleysville Mutual Insurance Co., participated in an informational conference call with PIA to address Harleysville's planned merger with Nationwide. The October 10 call was organized by PIA National President-elect Andy Harris and included PIA National Executive Vice President & CEO Len Brevik; PIA of New Jersey President Keith Savino; PIA of New York President Richard Savino; PIA Glenmont Executive Director Diane Fowler; along with senior staffs from PIA National, PIA Glenmont and Harleysville.

"We remain committed to our independent agency partners and to the independent agency system," said Browne, adding that the transaction "will enable us to expand our business for our independent agency partners, and to enter important new markets from a position of even greater strength."

Aside from more products and greater capacity, Browne said that independent agents now with Harleysville will be dealing with the same people they do now. Browne said he is going to remain as president of Harleysville, Tom Clark is remaining as head of field operations and virtually all of the field people agents have been dealing with will stay in place.

"The same people who have been making our business decisions in collaboration with you are going to continue to do so," he said. "Nothing's going to change in terms of the way we work with you, but because of the affiliation with Nationwide, we're going to have more products to offer you, we're going to have more capacity and over time, as we work things out with Allied, we're going to be operating in more states. Overall, between Allied and Harleysville, we operate in 44 states - so we're going to become a national independent agency carrier."

Browne said he anticipates that the necessary shareholder, policyholder and regulatory approvals can be obtained by early next year. He added that what some people on the East Coast don't realize about Nationwide is that west of the Mississippi, they have a really strong independent agency business in Allied, and Harleysville is going to be the platform for a strong independent agency business for Nationwide on the East Coast. "What Allied has done for Nationwide in the Midwest and the West; we're going to do East of the Mississippi. It's a great geographical fit," he said.

As a part of this transaction, Harleysville is going to go back to being 100% mutual, he said, and that the partnership with Allied is not related to Nationwide's captive agency force. While Harleysville will remain an IA-only carrier, it doesn't anticipate appointing captive agents, and the company doesn't expect to provide access to its products to Nationwide captives (who are primarily P/L in nature). However, Nationwide will be making a number of their product offerings available to and through Harleysville. This is still in the planning stages.

"Agents are concerned, but they want to be supportive," said PIA National Executive Vice President & CEO Len Brevik. "What I hear from agents is that Harleysville has a very strong culture and positive relationships with independent agents and that you have significant underwriting prowess. They want to see that culture continue to grow and prosper, because Harleysville's reputation with the agents is golden and I think Nationwide picked up a very strong partner with your company."

"We'd like to see Harleysville and the independent agency channel as the fastest-growing segment of Nationwide - so our goals are aligned," Brevik said. "We've had a great relationship with your company. Your marketing vice president Brian Flemming has been a great addition to The PIA Partnership. PIA agents look forward to a future of growth with Harleysville."