Scudder Kemper prepares to sell through insurance reps
November 16, 1998
Scudder Kemper Investment hopes soon to sell mutual funds through more than 14,000 insurance agents representing the Farmers Insurance Group of Companies. The mutual fund company is preparing a test program which will begin next year to offer new products with the Farmers name on them, through Farmers' agents, Ed Canaday, a Scudder Kemper spokesperson, said last week.
Details of the program were not available. But, neither no-load Scudder funds nor Kemper funds that are currently sold through intermediaries will be sold through Farmers' agents, Canaday said. Instead Scudder Kemper appears to be creating a new family of funds that it plans to sell through the Farmers agents. However, Scudder Kemper declined to confirm this. Canaday said only that the new funds with the Farmers Insurance label may be managed in part by Scudder Kemper asset management services.
Farmers, of Los Angeles, is the third-largest issuer of passenger auto and homeowners insurance. The company operates in 31 states, primarily on the West Coast and in the Mid-West.
Scudder Kemper and Farmers became affiliates as a result of the merger in September between Scudder Kemper's former parent, the Zurich Insurance Co., and Farmers' former owner, B.A.T. Industries plc. Both firms are now part of Zurich Financial Services.
Cross-selling was one of the benefits Farmers' officials sought from the merger. In the company's annual report issued in April, Martin D. Feinstein, Farmers' chairman and chief executive officer, said Farmers expected "to be able to expand (Farmers') menu of products and services" as a result of the transaction.
On Oct. 30, Scudder Kemper filed a registration statement with the SEC for five new mutual funds bearing the Farmers label that are likely to be the products Scudder Kemper sells through the Farmers agents.
The Farmers Investment Trust funds will each be a fund of funds, investing their assets in other mutual funds. The new offerings include an income, conservative, balanced, growth and growth and income fund.
Unlike Scudder Kemper's Pathway fund of funds which are made up of Scudder Kemper funds, the Farmers' fund of funds will include both Scudder Kemper and non-Scudder Kemper funds. Funds from Janus, PIMCO and Franklin-Templeton are part of the new fund of funds.
The funds will have sales charges of up to 5.75 percent, depending on the share class and fund. Canaday, citing securities law restrictions, declined to comment on Farmers Investment Trust while the registration statement is pending before the SEC.