2015 Annual Report
BUILDING ON OUR MOMENTUM
  • Nationwide is on a journey to become an ever-stronger company.

    Our long-term goal remains the same—creating value for our members and business partners. 


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    “I’ve been in business for 30 years now, and I have never seen an insurance company or its agent treat me and my claim so fairly and in such a timely manner. Nationwide, you get an A++ from me.” 

    J. Walter Wolfner, Owner, Riverside Golf Club
    Fenton, Missouri

  • Letter from our CEO 

    Deeper relationships, strong performance, refocused energy…twenty fifteen was all about building on our momentum.

    Steve RasmussenThis year, Nationwide’s “N and Eagle” logo proudly returned to our offices across the country as we moved all of our brands under the Nationwide banner. Our united culture was recognized as one of Fortune’s 100 Best Companies to Work For in 2015. We launched new products and reached significant milestones in financial services while also seeing solid growth in key areas in our property and casualty business. And, the power of our diverse portfolio was realized during a time of challenging market conditions. 

    With the transition of our products and services to the Nationwide brand, members are now better able to experience the multitude of ways we can help protect what matters most: their families, properties, businesses and financial futures. Nationwide’s financial services offerings continued to innovate and perform with the successful launch of the New Heights® Fixed Indexed Annuity suite; a focused approach to the business life insurance market; and a continued focus on building strength in core markets, including individual life, mutual funds and retirement plans. In property and casualty, Nationwide maintained the No. 1 position in the small commercial and farm business segments, while continuing to provide outstanding coverage for our members’ homes and automobiles as we have since our founding in 1926. 

    In 2015, we helped farmers and ranchers—whose businesses and homes we have insured for years—plan for their retirement and the ultimate transition of the family business through the Land As Your Legacy program. And valued commercial members, who for decades entrusted Nationwide to protect their automobile fleet, looked to Nationwide to add 401(k) plans to help protect their employees’ future. These are just two of many examples of how our members trusted us to provide more complete and holistic solutions under our robust Nationwide brand.

    While our products and services continue to evolve, our commitment to building relationships and making a difference remains steadfast. This shows with our claims response, the launch of the Make Safe Happen® initiative, and associate volunteerism, among many examples. For our members, partners and communities, we continued to demonstrate Nationwide’s More Than a Business® commitment.

    Although we generated a strong sense of momentum across Nationwide in 2015, we have only just begun. Our strong financial performance resulted in Nationwide continuing to advance on the Fortune 500 list, moving up to position No. 85. As we celebrate our 90th year in 2016, I’m confident we have the right mix of services and products to meet our members’ needs for years to come.

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    Steve Rasmussen
    Chief Executive Officer
    Nationwide

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    We are strong.


    $43 billion in total sales, $1.2 billion in net operating income, $26 billion in operating revenue, $197.1 billion in total assets


    #85 on the Fortune 500 list based on 2014 gross revenues


    A+, A.M. Best, received 10/17/2002, affirmed 3/19/2015





    We are passionate.

    Fortune 100 Best Companies to Work For


    We are trusted.

    Top 10 writer in multiple product lines across financial services, commercial and personal property and casualty


    We are everywhere.

    We do business in all 50 U.S. states


  • We are Nationwide.

    We have the solutions our members and partners are looking for.

    Financial Services: $23.7 billion in sales


    Commercial Lines: $7.8 billion in direct written premium


    Personal Lines: $11.4 billion in direct written premium




    We offer a broad collection of solutions.

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    Individual Life

    Annuities

    Retirement Plans

    Corporate Life

    Mutual Funds

    Banking 


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    Standard Commercial

    Farm and Ranch

    Commercial Agribusiness

    Excess and Surplus/Specialty 


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    Standard Auto

    Homeowners

    Other Personal Lines 





    We protect what’s most important.

    $16 billion paid in claims and other benefits to members in 2015 


    We have long-standing relationships in the community.

    $355 million contributed by the nationwide foundation since 2000 to Non-profit organizations across the country 


    We build strong partnerships.

    11,000+ property and casualty agencies, 35,000+ financial advisors 


  • One well-established brand, many forward-thinking solutions.

    We continue as a leader in the insurance and financial services industry with relevant products that anticipate our members’ needs.


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    “My family and I are very pleased with the way you recently handled a claim for us. I have already told a number of people about our experience, and I intend to continue doing that as opportunities arise going forward.”

    Astrida Olds, Nationwide member since 1960
    Bloomfield, Connecticut

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    Our financial services solutions help America prepare for and live in retirement.

    Nationwide increased financial services sales to $23.7 billion in 2015, up 14% over 2014. Sales across all major product lines were up over prior year, supported by new product launches and new and renewed relationships. Net operating income totaled $1.1 billion in 2015. Managed customer assets grew to $210.1 billion.

    Business highlights for the year include retirement plans reaching $100 billion in assets under management; closing of a large corporate life insurance account with a Fortune 100 company; strong sales for fixed indexed annuities and individual life insurance; strong mutual funds performance; and, the launch of a new consumer auto lending solution through Nationwide’s bank that makes car buying simpler and faster.

    $23.7 billion total sales: 43% Retirement plans, 7% Corporate life, 7% Individual life, 6% Mutual funds, 37% Annuities

     



    Making retirement planning easier

    We know the challenges of planning for retirement. That’s why we established the Nationwide Retirement Institute®. We break down and simplify complex retirement challenges through comprehensive, client-ready solutions. For example, Social Security 360® is a program designed to help financial advisors build Social Security guidance into their business and meet their clients’ retirement planning income needs.


    Retirement Plans: #1 in 457 plans1 based on number of plans, #10 in 401(k) small plans1 based on number of plans



    Individual Life: 8th largest Life Insurer; Annuities: 9th largest writer of Variable Annuities



    Corporate Life: #1 writer of Corporate Life; Mutual Funds: Top 15 best mutual fund families of 2015

    1. PLANSPONSOR, 2015 Recordkeeping Survey.
    2. LIMRA, Q3 YTD, 2015. Based on total premiums.
    3. Morningstar, Q3 YTD 2015. Based on total flows. 
    4. IBIS Associates, Inc., February 2016. Based on first-year premiums.
    5. 2015 Barron’s/Lipper Fund Family Ranking 


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    Nationwide offers a suite of commercial solutions to help business owners protect their life’s work.

    Total direct written premium for Nationwide’s commercial lines grew to $7.8 billion, up 5% over 2014. All major product lines grew over prior year, led by standard commercial. Strong sales in commercial agribusiness and farm and ranch renewal premiums drove 10% growth over 2014.

    $7.8 billion total direct written premium

     



    Helping business owners manage risk

    Loss Control Services gives our members exclusive access to a team of highly-trained consultants whose sole purpose is to help manage risk and keep our members’ businesses running smoothly. Whether we’re advising on risk management plans, assessing property for potential hazards, or delivering safety training to employees, our members can expect Loss Control Services to be qualified, responsive and resourceful.


    Standard Commercial: #1 total small business insurer


    Commercial: 7th largest commercial lines insurer; 2nd largest domestic specialty (excess & surplus) commercial lines insurer


    Farm and Ranch: #1 writer of farms and ranches
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    We help individuals and their families protect what’s most important.

    Personal lines premium grew to $11.4 billion, up 3% from 2014, with all major product lines delivering year-over-year growth. Direct sales to consumers drove double-digit growth, supported by expanded online sales of homeowners policies into more states. Strong growth momentum continued in Nationwide Private Client and pet insurance.

    $11.4 billion total direct written premium 

     



    Meeting members’ unique needs

    Nationwide offers a wide range of personal lines products and services designed to meet the evolving needs of our members. In addition to auto and home, we offer protection for renters, pets, motorcycles, boats, recreational vehicles, identity theft, as well as other specialty coverages, including personal umbrella liability and travel insurance.


    Homeowners: 7th largest homeowners insurer
    Auto: 8th largest auto Insurer


    1. A.M. Best, 2014 DWP.
    2. A.M. Best, 2014 DWP.
    3. North American Pet Health Assn., 2014.

  • Acting in the present. Building for the future.

    We help turn critical moments into powerful possibilities in places where our associates live and work.


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    “United Way greatly values its long-standing partnership with Nationwide, which has resulted in positive change that will be both lasting and at scale.”

    Brian Gallagher, President and CEO
    United Way Worldwide

    “The Nationwide Foundation helps enable us to provide emergency resources and assistance to survivors wherever and whenever disaster strikes.”

    Gail McGovern, President and CEO
    American Red Cross

  • We’ve long held the belief that together we can do more.

    We create lasting change in our communities through philanthropy, volunteerism, and workplace giving, all centered on the goal of helping individuals and families build a brighter future.


    United Way

    Nationwide has a long-standing partnership with United Way to help meet the needs in the community, extending back to the early 1950s. By joining efforts, we are working to effect positive and lasting change.


    United Way

    Feeding America®

    In 1981, Nationwide began its partnership with the Mid-Ohio Foodbank by participating in its inaugural Operation Feed campaign—the largest grassroots corporate food drive in Central Ohio. Since that time, Nationwide’s hunger relief efforts have grown into a national partnership with Feeding America. 

    Feeding America


    American Red Cross

    Nationwide and the American Red Cross have partnered for more than 70 years around a common purpose of helping communities through blood donation and disaster relief. 

    We’re proud to be the first company in America to open a full-time, onsite American Red Cross blood donor center, through which our associates donate thousands of pints of blood each year.


    American Red Cross

    Nationwide Children's Hospital

    Children’s well-being is at the heart of Nationwide’s mission to protect what’s most important. Through our 60-year relationship with Nationwide Children’s Hospital, Nationwide and the Nationwide Foundation have provided, in aggregate, more than $100 million in funding and support to the hospital. Together, we’ve helped make advancements in the areas of child safety, heart care, neonatology and genomics.


    Nationwide Children's Hospital

    Make Safe Happen

    Launched in 2015 and to support our long-time focus on children’s safety, Nationwide’s Make Safe Happen program is dedicated to driving awareness and action around accidental childhood injuries in and around the home. In partnership with our Make Safe Happen Advisory Council—an esteemed group of injury prevention and child safety experts—we’re focused on sharing lifesaving information with parents and caregivers on critical at-home safety risks. All with the goal to help inspire one million safety actions in 2016. We believe it’s our duty to help protect your home and the loved ones in it. Learn more at MakeSafeHappen.com.

  • Facing the future with strength and stability.

    Strong financials provide our members peace of mind, knowing we’ll be here for them for many years to come.


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    “Thank you for your dedication to our members. A company is only as good as the promises it keeps. You have again proven that Nationwide keeps its promises.”

    Jeff Cooper, Nationwide agent
    Arkansas

  • Letter from our CFO

    Twenty fifteen marked a time of both exciting and significant change for Nationwide.

    Mark ThresherWe continued our efforts to align our businesses under a single brand to enable us to deliver a more seamless experience to our members and partners. Amidst change, our associates and partners came together to serve our members and grow our business. We delivered another year of solid performance and we ended the year with a strong capital position—both of which help ensure that we’ll be here for our members for many years to come. Nationwide continued to deliver on its promises, paying $16 billion in claims and other benefits to members in 2015. Additionally, A.M. Best and Standard & Poor’s both reaffirmed Nationwide’s A+ ratings of financial strength during the year.

    In 2015, Nationwide grew operating revenue to $26 billion—the highest in our history. Our financial services, commercial and personal lines product segments generated a record total of $43 billion in sales in 2015. All major product lines grew over prior year, as we continued to offer new and enhanced solutions that our members need to protect their families, possessions, businesses and their futures.

    From a profitability standpoint, total net operating income increased to $1.2 billion, up 10 percent over 2014. While these results were strong, our performance was negatively impacted by the volatility in the financial markets, as well as increased non-weather losses in the auto product line—both of which were a challenge, not just for Nationwide, but for the industry as a whole. We continue to keep an eye on these areas as we head into 2016.

    Looking ahead, we’re excited about the future and the opportunities we’ll have to serve our members in new and better ways. Thank you to our associates, partners and members for being part of the Nationwide family and for continuing to put your trust in us.

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    Mark R. Thresher
    Chief Financial Officer
    Nationwide

  • Financial Highlights


    Total Sales (in billions): $34.4/2011, $34.4/2012, $36.9/2013, $39.3/2014, $42.9/2015; Net Operating Income (in billions): $0.52/2011, $0.74/2012, $1.35/2013, $1.12/2014, $1.23/2015; Operating Revenue (in billions): $20.7/2011, $22.4/2012, $23.9/2013, $25.3/2014, $26.0/2015; Total Assets(in billions): $154.0/2011, $168.3/2012, $183.2/2013, $195.2/2014, $197.2/2015 


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    We honor our commitments through strong financial discipline.


    Capital strength

    Nationwide’s capital position remains strong. Statutory surplus—a measure of financial strength and claims-paying ability evaluated by regulators and rating agencies—increased to $15.1 billion. Nationwide maintains more than three times the amount of statutory surplus required by regulators to cover its obligations to customers. Total policyholders’ equity increased to $20.6 billion, compared to $20.4 billion at the end of 2014.

    2013 - $20.0 billion, 2014 - $20.4 billion, 2015 - $20.6 billion




    Investments

    Our investment strategy focus is to ensure Nationwide is financially strong, stable and secure so we can be there for our members. We strive to accomplish this by having: 

    • An in-depth understanding of the company’s goals and member needs 
    • Multi-asset class capabilities that provide diversification and strong risk-adjusted returns 
    • A team that has the expertise needed in today’s financial marketplace 

    In 2015, general accounts investments increased to $86.8 billion, up from $82.9 billion in 2014. Net investment income of $3.1 billion was down from year-end 2014, driven by lower income from alternative investments.

    $86.8 billion investment portfolio: 75% Fixed maturity securities, 13% Mortgage loans, 2% Short-term investments, 1% Real estate, 9% Other investments




    Risk management

    Risk management is an integral part of ensuring that we deliver on the promises we have made to our members. We do this through growing our business, maintaining capital strength to withstand unexpected events and ensuring adequate returns for the risks we take. Nationwide has developed a well-respected risk management discipline for identifying, assessing and managing risks throughout the organization.




    Enterprise financial strength ratings

    Nationwide’s financial strength and credit ratings were affirmed by rating agencies during their most recent reviews. Factors cited to support these ratings include:

    • Strong capital position 
    • Excellent risk management capabilities 
    • Product and distribution breadth 
    • Diversified businesses with market leadership position
    A+: A.M. Best received 10/17/2002, affirmed 3/19/2015; A1: Moody’s received 3/10/2009, affirmed 9/12/2013; A+: Standard & Poor’s received 12/22/2008, affirmed 5/1/2015




  • Statutory financial highlights

    Nationwide prepares financial statements using generally accepted accounting principles (GAAP), which are a common set of accounting principles, standards and procedures that companies across different industries use to compile their financial statements.

    As an insurance company, Nationwide also prepares financial statements following statutory accounting principles, which are a set of accounting rules for insurance companies set forth by the National Association of Insurance Commissioners (NAIC).

    Statutory accounting principles are generally regarded as more conservative than GAAP. Statutory financial information is the basis for state regulation of insurance companies’ solvency throughout the U.S. Additionally, rating agencies use statutory financial information in their evaluation of an insurance company’s financial strength.  



    2013: $34.5, 2014: $36.6, 2015: $40.2 (in billions)

    Combined Statutory Revenue

    Combined statutory revenue is a financial measure that is calculated by combining the statutory revenues of Nationwide’s property and casualty and financial services subsidiaries. It excludes non-insurance sales, such as trust company and retail mutual funds.


    2013: $14.4, 2014: $14.9, 2015: $15.1 (in billions)

    Combined Statutory Surplus

    Combined statutory surplus is a financial measure of Nationwide’s ability to meet future obligations, which is calculated based on accounting practices prescribed or permitted by the department of insurance of the state of domicile. Each of the states where Nationwide’s insurance companies are domiciled has adopted the NAIC statutory accounting principles as the basis of its statutory accounting practices.


    2013: $171.2, 2014: $182.6, 2015: $179.9 (in billions)

    Combined Statutory Assets

    Combined statutory assets is a financial measure that is calculated by combining the net admitted statutory assets of Nationwide’s property and casualty and financial services subsidiaries.


  • Working together to move forward.

    Protecting what matters most since 1926.

    Board of Directors

    James B. Bachmann
    A. I. Bell
    Timothy J. Corcoran
    Yvonne M. Curl
    Kenneth D. Davis
    Daniel T. Kelley
    M. Diane Koken
    Lydia M. Marshall
    Terry W. McClure
    Barry J. Nalebuff
    Brent R. Porteus
    Suku Radia
    Stephen S. Rasmussen
    Michael J. Toelle
    Sparky R. Weilnau
    Jeffrey W. Zellers

    Senior Executive Leadership

    Stephen S. Rasmussen
    Chief Executive Officer

    Mark A. Berven
    President and Chief Operating Officer
    Nationwide Property and Casualty Operations

    Patricia R. Hatler
    Chief Legal and Governance Officer

    Michael C. Keller
    Chief Information Officer

    Gale V. King
    Chief Administrative Officer

    Mark A. Pizzi
    President and Chief Operating Officer
    Nationwide Direct and Member Solutions

    Mark R. Thresher
    Chief Financial Officer

    Kirt A. Walker
    President and Chief Operating Officer
    Nationwide Financial

    Terrance Williams
    Chief Marketing Officer


    “We are making progress on our journey of leveraging the Nationwide brand to become a collection of solutions that meets the evolving needs of our members and partners. I’m confident the steps we are taking will propel us into an even more successful future.”

    Tim Corcoran
    Chairman, Nationwide



Message from our CFO

Chief Financial Officer Mark Thresher reviews performance

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2015 Annual Report

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