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Prudential

According to Chapin (1950), the company was founded by John Dryden in 1875 as the Prudential Friendly Society, with the business model of selling life insurance policies for the standard premium of 3 cents a week, or $1.56 per year. The company changed the name to the Prudential Insurance Company of America, and expanded sales from Newark, N.J. to New York and Philadelphia. By 1885 one million policies had been sold. The company history on Hoover's Corporate Profiles points out that Prudential added ordinary whole life insurance in 1886 and, by 1900, the firm was selling more than 2,000 such policies annually and had 3,000 agents in eight states.

The famous Rock of Gibraltar logo was designed in 1896 by New York-based J. Walter Thompson, and in 1916, the company sold its first group life policy. As Chapin observes, the company became "mutualized" (buying its shares back from a majority of its shareholders). This move, unfortunately, coincided with the American entry into World War I, and the families of soldiers killed in combat were paid more than $7 million in claims. World War I was followed almost instantly by the influenza epidemic of 1918, in which Prudential took another major hit, paying out almost half a million dollars in claims on one day alone (Chapin, 1950, 42).

During the next decades, the company kept buying its stock back from shareholders, and, by World War II, the company was in control of all of its stock.

The Prudential Insurance Company of America, is the preeminent life insurer in the United States, and is the fourth largest worldwide. The company is going through a massive restructuring from a mutual to a stock company despite the potential danger of a takeover. Here is a summary of its core competencies as extracted from its 1999 Annual Report.

a leader in the development of new insurance standards, industries, products, and the like, and has also been at the vanguard of using, and to...

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Prudential. (1969, December 31). In LotsofEssays.com. Retrieved 07:37, March 29, 2024, from https://www.lotsofessays.com/viewpaper/1706345.html