Empower exceeds 90 percent retention of participants and assets from MassMutual acquisition

Simplified processes, service continuity and a focus on financial wellness key to driving client decisions

As Empower approaches the completion of its integration of the acquired MassMutual retirement business, the company is announcing key client milestones tied to furthering the success of employers and retirement investors the company is now serving.

Empower closed its acquisition of MassMutual’s retirement plan business in December 2020 with the intent of capitalizing on both firms’ expertise, expanding technological excellence and product capabilities, and creating scale. A comprehensive integration program consisting of eight “waves” of plan integrations launched in mid-2021 is slated to conclude in October.

Key achievements:

Retention results: Through the integration process, Empower has earned the trust of more than 20,000 MassMutual clients and 2.3 million participants — a 92 percent participant retention rate, as of Aug. 31. Empower retained approximately $174 billion in client assets, or 91 percent. In addition, Empower retained 87 percent of all plans.

“This program was focused on introducing Empower to millions of retirement investors and their employers and asking them to get to know us and put their trust in us,” said Edmund F. Murphy III, president and CEO. “We are grateful for the confidence they’ve put in us and look forward to earning their business every single day.”

Murphy explained that for many busy plan sponsors, retirement plans can be seen as complex but important benefits. Empower’s efforts to make the process simple for sponsors is a hallmark to its top retention rates.

A simplified integration: Based on years of retirement plan integration experience, Empower simplified the requirements for plan sponsors to move their plan to the company’s recordkeeping platform. Making use of technology tools that brought new automation to the process of onboarding new plans, Empower was able to simplify and economize some phases of plan transition.

“It is an important goal that we don’t ask too much of plan sponsors. Their HR and benefits teams are busy enough, and we’re here to serve their needs first,” said Empower president and chief operating officer Rich Linton. “We firmly believe in keeping the asks of them to a minimum.”

In addition, Linton said the movement of MassMutual plans from a multi-platform environment to a single recordkeeping system also has the potential to economize the administration of the entire business.

Financial wellness focused: All former MassMutual retirement plan participants have access to Empower’s financial wellness-focused participant web experience at the center of their retirement planning journey. Empower’s site — which is being launched with all clients this year — offers a comprehensive, 360-degree view of an individual’s financial picture, including all retirement assets, lifetime income projections, bank accounts, taxable investment accounts, and liabilities such as mortgages and credit cards.

“We owe it to the people we serve to provide them with intuitive financial tools, so they have the opportunity to plan for the future they deserve,” said Linton. “Everyone has a different story, different goals, different priorities, and we have created sophisticated technology supported by human advice that is unique and personal to every saver and encourages them to take action and take control of their financial futures.”

“We believe in talking to individuals about money in terms that they understand,” he said. “And we believe employers find that incredibly helpful for their workers.”

Service team continuity: Throughout the integration program, Empower is maintaining client service teams to help support plan sponsors, third-party administrators (TPAs), advisors and consultants involved in moving to the Empower platform. The familiarity between trusted parties helps plans integrate more efficiently.

“Integrating businesses is a huge undertaking, and maintaining continuity for our clients has been crucial,” said Linton. “Bringing together two very experienced teams benefits everyone.”

The combined firm will continue to serve retirement plans sponsored by a broad spectrum of employers. These include mega, large, mid-size and small corporate 401(k) plans; government plans ranging in scale from state-level plans to municipal agencies; not-for-profits such as hospitals and religious organizations’ 403(b) plans; collectively bargained Taft-Hartley plans; and nonqualified plans. The transaction also included MassMutual’s defined benefit business, which is now under the umbrella of Empower.

Murphy said Empower’s strategic acquisitions have raised its attractiveness to new clients. Request-for-proposal activity in the last year has been higher than any previous year across plan types, including 401(k), 457(b), 403(b) and Taft-Hartley defined contribution plans of all sizes covering corporate, government, unions, and not-for-profit employers.

“The talent level in our organization between Empower and former MassMutual associates is second to none and everyone here is absolutely obsessed with customer success, and it shows in how well this integration program has progressed,” said Murphy.

In addition to the MassMutual business, Empower acquired the full-service retirement business of Prudential Financial in April 2022. Integration of the Prudential business begins in the first quarter of 2023.

About Empower

Headquartered in metro Denver, Empower administers approximately $1.2 trillion in assets for more than 17 million retirement plan participants¹ and is the nation’s second-largest retirement plan recordkeeper by total participants.² Empower serves all segments of the employer-sponsored retirement plan market: government 457 plans; Taft-Hartley plans; small, mid-size and large corporate 401(k) clients; nonprofit 403 (b) entities; private-label recordkeeping clients; and IRA customers. Personal Capital, a subsidiary of Empower, is an industry-leading hybrid wealth manager. For more information please visit empower.com and connect with us on Facebook, Twitter, LinkedIn and Instagram.

1 As of June 30, 2022. Information refers to all retirement business of Empower Annuity Insurance Company of America (EAIC) and its subsidiaries, including Empower Retirement, LLC; Empower Life & Annuity Insurance Company of New York (ELAINY); and Prudential Retirement Insurance & Annuity Company (PRIAC), marketed under the Empower brand. EAIC’s consolidated total assets under administration (AUA) were $1,289.3B. AUA is a non-GAAP measure and does not reflect the financial stability or strength of a company. As of June 30, 2022, EAIC’s statutory assets total $77.2B and liabilities total $74.3B. ELAINY’s statutory assets total $6.9B and liabilities total $6.7B. PRIAC’s statutory assets total $82.1B and liabilities total $80.8B.

2 Pensions & Investments 2020 Defined Contribution Survey Ranking as of April 2021.

On August 1, 2022, Empower announced that it is changing the names of various companies within its corporate group to align the names with the Empower brand. For more information regarding the name changes, please visit empower.com/name-change.

Securities, when presented, are offered and/or distributed by Empower Financial Services, Inc., Member FINRA/SIPC. EFSI is an affiliate of Empower Retirement, LLC; Empower Funds, Inc.; and registered investment adviser Empower Advisory Group, LLC. This material is for informational purposes only and is not intended to provide investment, legal or tax recommendations or advice.

Empower refers to the products and services offered by Empower Annuity Insurance Company of America and its subsidiaries, including Prudential Retirement Insurance and Annuity Company and Empower Retirement, LLC. This material is for informational purposes only and is not intended to provide investment, legal or tax recommendations or advice.

“EMPOWER” and all associated logos and product names are trademarks of Empower Annuity Insurance Company of America.

Prudential and all associated logos are registered trademarks owned by The Prudential Insurance Company of America and are used under license.

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