Mutual of Omaha Insurance Co. policyholders have voted overwhelmingly to reorganize the carrier under a mutual holding company structure, a move that would make the 117-year-old insurer's subsidiary United of Omaha part of a new corporate architecture designed to unlock cheaper capital.
Policyholders cast their ballots either by proxy or in person at the company's annual meeting last week. Mutual of Omaha said it will file a letter certifying the vote with the Nebraska Department of Insurance on March 18, as required by state statute. The plan needed approval from at least two-thirds of eligible members.
Under the reorganization, Mutual of Omaha would become a stock insurer with shares held indirectly by a newly formed Mutual of Omaha Holding Co. United of Omaha will remain a stock insurance company and wholly owned subsidiary, the company said in a supplemental filing to its 2024 financial statement.
The restructuring is designed to give the company access to more economical debt markets. As a mutual insurer, the company cannot issue equity and has relied on surplus notes, a form of subordinated debt that requires regulatory approval before interest or principal payments can be made, as outlined by the National Association of Insurance Commissioners.
S&P Global Market Intelligence reported that the company had $717.2 million in surplus notes outstanding as of the end of 2023.
Under the new mutual holding structure, an intermediate stock holding company can issue conventional senior debt and non-voting equity securities without those constraints, as detailed in a Mayer Brown guide to insurance capital markets.
S&P Global noted that if completed, the reorganized entity would become the second-largest US life mutual insurance holding company by gross premium volume, behind only Pacific Mutual Holding Co.
The conversion has inevitably raised questions about whether it is a precursor to full demutualization. When the board first adopted the plan in April 2025, a spokesperson said the reorganization "does not constitute demutualization" and that there were no plans to issue stock or bring in external shareholders.
The concern is not without precedent. Principal Financial Group famously converted to a mutual holding company structure before ultimately completing a full demutualization and IPO, S&P Global has noted.
Mutual of Omaha itself explored a similar reorganization in 1998, S&P Global reported, but the conversion never proceeded for reasons that remain unclear in the public record.
Founded in 1909, the company serves more than 5.6 million individual product customers and 54,000 employer groups across all 50 states. As of December 31, 2024, total admitted assets stood at $11.86 billion, up from $10.98 billion a year earlier, with total surplus rising to $4.15 billion.
Nebraska Insurance Commissioner approval is still required before the plan can take effect.
