The History and Origin of Principal Financial Group
Principal Mutual Life Insurance is the primary member of The Principal Financial Group. The Principal Financial Group encompasses 20 insurance and financial-services companies, most of which are subsidiaries of Principal Mutual Life Insurance Company, which is among the ten-largest mutual life insurance companies in the United States. Other companies in the group are involved in stock brokerage, financial planning, investment management, and health, homeowners, and automobile insurance.
Principal financial was founded in Chariton, Iowa in 1879.
The history of the Principal financial group can be traced back to a partnership of 6 individuals. Edward Temple, who became the companies first CEO and five of his banker colleagues came together to form the Bankers life association in 1879 then they began selling membership to men between the ages of 22 and 55 who had to be in good health and not be employed in any occupation that was considered high-risk. For example, you would not have qualified if you were a driver with a spotty driving record.
Insurance benefits would also not be awarded if unintentional death was caused by harmful consumption of alcoholic beverages, or the irresponsible use of drugs.
By 1889 Bankers Life Association had $29 million of life insurance memberships in effect. This required the association to relocate its operations to the Equitable Building in Des Moines, Iowa. Costs were kept at frugal standards. Edward Temple’s (CEO and one of the founders) salary increased to $6,000 in 1890, which was considerably lower than salaries offered by similar businesses.
Growth in the 20th Century
After the death of Edward Temple in 1909, the Board of Directors voted to reorganize the business into a mutual life insurance company. George Kuhns became president of the company. He employed the use of direct-mail advertising to reach new markets. This brought in $3 million in new sales within the first year. The company later acquired a small, 500-watt radio station, WHO, with a broadcast range of 150 miles (240 km), because George Kuhns saw this tool as a way to increase sales, he ran WHO until 1930.
True to its purpose, WHO helped increase the awareness of the company and by 1930, prior to the Great Depression, the company was closing in on the $1 billion landmark.
In 1939 due to its growth, the Banker’s life association had to move to the fully air-conditioned building was constructed at 711 High Street to house the offices. It was the first building in Des Moines to be fully air-conditioned.
By 1941, the company began issuing health insurance contracts. Within the next five years, the group’s health insurance accounted for a third of the business.
On October 23, 2001 Principal financial group filed its initial public offering and became a publicly traded corporation.
As of March 2014, Principal employed 14,600 employees worldwide, with its Global Delivery center, Principal Global Services, in Pune, Maharashtra, India.
Principal Financial Group Reviews and Rankings
In April, 2013, Investments & Pensions Europe (IPE) magazine, the leading European publication for institutional investors and those running pension funds, presented Principal Global Investors with two 2013 Pension Fund Perception Programme Awards. The awards recognize asset managers rated highest by their pension fund clients.
Principal financial group is ranked as one of the largest insurance firms in the United States by the National Association of Insurance Commissioners (NAIC).
Change of Name and Further Expansion
The company’s name was changed from Banker’s life association to Principal financial group in 1985, The company expanded to markets outside of the United States, including Brazil, China, Chile, Hong Kong, India, and Mexico.
The company enjoys a 4-star ranking by Best Company with a review that clearly states that “Principal Financial Group offers excellent term life insurance policies in addition to universal life, variable universal life, and survivorship insurance around the world.”
The Principal life group is currently ranked #93 by Forbes on America’s best employer list.