The parent company of Old Mutual Life Insurance Co. and its subsidiary, OM Financial Life Insurance Co. of New York, said today (March 11) it is considering selling off both companies.

Old Mutual PLC, a London-based company with banking, insurance and wealth management operations in 35 countries, said the possible sales are part of its corporate restructuring plan, which includes “streamlining” its operations. The company said it will exit markets where its operations fail to meet a 15% return on equity.

The possible sale creates uncertainty for Old Mutual Life, based in Baltimore, Md., and OM Financial Life, based in Purchase, N.Y. In response, A.M. Best Co, a ratings service, put both companies and their parent’s ratings “under review with developing implications.”

No possible suitors for either or both firms were immediately identified.

Julian Roberts

Old Mutual PLC’s strategy to build a long-term savings, protection and investment group includes “reducing the exposures to U.S. by exploring disposal of U.S. Life business” after it completes efforts to improve performance, according to its preliminary results statement, issued today (March 11).

The parent company’s priority last year was to “stabilize issues” in its life operations and restore capital and liquidity positions, said Julian Roberts, Old Mutual PLC’s group chief executive, in a statement. The company intends to focus more heavily on its operations in South Africa, as well as its base in the United Kingdom.

U.S. life insurance sales have been flat for the last few years, reacting in large part to the recession and stock market battering that began in fall 2008.

A.M. Best in its comments on the ratings update indicated that OM Financial Life maintains minimal financial leverage. It had $367 million in realized investment losses last year, as well as “a substantial—albeit planned—reduction in new business premium and significant reserve relief realized through reinsurance transactions with its Irish reinsurance affiliate, Old Mutual Reassurance (Ireland) Ltd.”