Nationwide says its results in the financial services andP&C sectors have allowed it to make investments in itsbusiness—among them strategic spends on improving the insurer’sdirect channel capabilities.

Mark Thresher, Nationwide CFO, says the Columbus, Ohio-basedinsurer has increased investments in brand and expansion of thedirect channel business into six new states. Year-to-date directchannel premium grew nearly 18 percent over 2012.

Thresher acknowledges agents were “at first all worried” aboutNationwide’s direct channel plans, but have since “embraced thefact they get leads generated” from the direct channel.Additionally, he says agents are still playing a role in auto.About 50 percent of new auto businesses started on the Internet.About 35 percent of these customers signed up for a policy online,but the rest still preferred to go to an agent.

Still, Thresher adds, “We believe to be successful, agents mustdiversify and grow their commercial and financial servicesbusinesses. Personal lines will become less significant. You can’tlive on just standard auto going forward.”

Along with updating outdated claims systems, Nationwide has alsoinvested in the roll-out of new products—using subsidiaryCrestbrook Insurance—aimed at the high net worth segment, offeringinsurance for high-value homes, automobiles, collections and excessliability.

“We think it is a market we can excel in,” says Thresher.Nationwide’s Scottsdale subsidiary assembled a team, led byCrestbrook President Jim Pedersen, most recently of Home ValueInsurance Co. He also held senior positions at Fireman's FundInsurance Co.

Thresher says it will take several years to roll our Crestbrook.The insurer is in one state thus far, with plans to enter “ahandful” of others in 2014, he says. Nationwide will reach out toindependent producers to sell the products, since a small amount ofNationwide agents have experience serving the high net worthmarketplace.

Third quarter net income fell nearly 24 percent, compared to thesame period a year ago, to $288 million. Thresher said the decreaseis largely attributable to “one-time tax true-ups” and a $99million charge to strengthen asbestos and reserves.