Discover Financial Services and Nationwide Insurance Announce Alliance
3 May 2000
Companies to Offer Discover-Branded Auto InsuranceCOLUMBUS, Ohio - Discover Financial Services, a business unit of Morgan Stanley Dean Witter & Co. and Nationwide Insurance Companies today announced the formation of an alliance that will offer auto insurance products underwritten by Nationwide Insurance Companies to Discover Cardmembers and other consumers. Future plans include the development of Discover-branded auto insurance products. During the development of the Discover-branded products, Discover Card will market Nationwide products through Discover Insurance Agency and affiliated agencies. The alliance is an example of how financial institutions are broadening their customer relationships and using new distribution channels. It will combine Discover Financial Services' marketing expertise, brand and Cardmember base with Nationwide's extensive claims, administration and underwriting capabilities. "This is a tremendous growth opportunity for us," said Nationwide Insurance Companies president Galen Barnes. "Discover Financial Services' reputation for offering smart financial solutions to its customers makes the company an attractive partner for this alliance. "We're looking forward to working with Discover Financial Services to offer auto insurance products. This helps us meet our objective of offering our products to customers on their terms," Barnes added. "We are strongly committed to the success of this endeavor," said David Nelms, president of Discover Financial Services Inc. "With Nationwide as our partner, we will expand the valuable and convenient financial services we currently offer our Cardmembers to include auto insurance products." Initially, Nationwide and Discover Financial Services will market auto insurance products through Discover Insurance Agency and affiliated agencies to Discover Cardmembers in Texas and California. Three additional states -- Arizona, Colorado and Oregon -- will be added in the near future. By the end of this year, Nationwide and Discover Financial Services expect to offer auto insurance products in additional states, subject to approval of rates, products and forms at the state level. Discover Financial Services will market the auto insurance coverage through its Internet site, statement inserts and direct mail. Also, Cardmembers calling Discover Card with service inquiries can be transferred to a Nationwide licensed sales representative to obtain a quote on their auto insurance coverage. Discover Card will be accepted for payment of the policy's premium. Nationwide, with headquarters in Columbus, Ohio, is one of the largest property/casualty insurance and financial services companies in the United States. Discover Financial Services, based in Riverwoods, Ill., is a business unit of Morgan Stanley Dean Witter & Co., and operates the Discover Card brands, with more than 48 million Cardmembers. Discover Financial Services' network is the largest independent credit-card network in the United States, with more than 3.5 million merchant and cash access locations.