Liberty Financial Cos. plans to combine the sales forces that sell its mutual funds and its annuities to save money and increase sales.
The reorganization involves two units: Liberty Funds Distributor, the mutual fund distribution business, and Keyport Life Insurance Co., the annuity company.
By early August, when most of the restructuring is to be completed, the 60 wholesalers involved will have smaller geographic regions but more products to sell, the company said. No layoffs are expected because of the reorganization, a spokesman said.
"We found ourselves marketing two different products to the same general audiences," said Kenneth R. Leibler, the president and chief executive officer of Liberty. "We thought it would be far more effective for us to put together one single wholesaling force."
The change could boost sales since wholesalers will be able to make more calls on their distribution partners, he said.
Boston-based Liberty sells its products through banks, brokerages, financial planners, and independent insurance agents. It has $20 billion of assets under management distributed through Liberty Funds Distributor and $17 billion of annuity assets accumulated through Keyport.
Liberty's move will address the increasing overlap of sales efforts for its mutual funds and its variable annuities, which the company has been emphasizing of late and whose sales industrywide have outstripped those of fixed annuities.
Keyport introduced its variable annuities two years ago and last year combined the sales forces for its fixed and variable annuities, focusing on the hotter product, variables.
Sales through banks of its fixed annuities fell to $338 million in 1998 from $457 million the year before, while variable sales rose to $305 million from $138 million, according to Kenneth Kehrer, a consultant in Princeton, N.J.
Mr. Kehrer said combining the sales forces "will make them much more efficient."
Less air travel is a big reason, he said: Distribution companies typically shell out as much for travel as for compensation. A pitfall of combining the forces is that wholesalers tend to have a bias toward the product with which they are more familiar, Mr. Kehrer said.
Mr. Leibler said the company plans lots of cross-training and teams of experts who will answer wholesalers' questions-and even accompany them on client calls.
Liberty Funds Distributor's wholesalers have been selling variable annuities for more than a year, the spokesman said. And Keyport wholesalers are familiar with mutual funds because they make up the investment component of variable annuities. Variable annuities are mutual funds in an insurance wrapper.