USF&G is creating 2 divisions Groups for surety bonds, commercial insurance

July 26, 1996|By Bill Atkinson | Bill Atkinson,SUN STAFF

USF&G Corp. said yesterday that it is breaking out two major pieces of its property and casualty operations into distinct groups in an effort to generate growth.

The Baltimore-based insurer named Glenn W. Anderson president of the newly formed Commercial Insurance Group, and Robert J. Lamendola president of USF&G's Surety Group.

"We will be much more agile," said Norman P. Blake Jr., USF&G's chairman and chief executive. "We will be able to move much more quickly."

Blake said the businesses have reached the point where they have clear strategies and are generating profits.

Commercial insurance, for example, insures everything from municipalities to trucking and software companies.

The group has annual net written premiums, or revenues, of about $1 billion, which is about one-third of the $14.6 billion-asset company's 1995 revenues.

The Surety Group has annual revenues of about $250 million, and it specializes in providing performance bonds that guarantee the work of contractors.

Prior to being broken out as individual groups, the two businesses were mixed with other property and casualty operations where, in some instances, they shared agents and claim processors.

"The business is clean, it is focused," said Kerrie Burch-DeLuca, a USF&G spokeswoman. "They are no longer dependent on shared resources. USF&G had agents that sold all of their products, but now each group will have a dedicated agent force."

Before Blake joined the company in 1990, USF&G was trying to be "all things to all people," he said. But Blake has narrowed the company's focus into a handful of businesses, and within those groups he has developed niche insurance products.

He said about 30 percent of Commercial Insurance Group's revenues is coming from new products.

"That strategy is working," he said.

Blake said the Surety Group has overhauled its management team and is marketing its products overseas.

"Surety has long been the flagship of USF&G," Blake said. "Bonding was USF&G's original product 100 years ago, and our surety operations have ranked at or near the top of the industry for our entire history."

Pub Date: 7/26/96

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