Laid-off Beneficial employees weigh options

After 34 years with the same company, Brent Burgon has some decisions to make. He was told on Tuesday that his last day on the job would be Aug. 31.

Burgon, managing director of technical services, isn't alone. He is one of 150 people at Beneficial Financial Group who were told their jobs are being eliminated.

Ironically, the father of five said he received the bad news on his 39th wedding anniversary.

"It was quite a surprise," he told the Deseret News. "In the back of our minds, we always wondered what would happen with the company, but it was a surprise."

Beneficial, one of Utah's oldest insurance and annuity companies, announced Tuesday it will cut about 150 jobs from its 214-person Utah work force and discontinue writing new policies.

Parent company Deseret Management Corp. said in a news release that the reason for the decision to pull out of the insurance business, and the resulting job cuts, was Beneficial's "relatively small size putting it at a competitive disadvantage compared to larger insurers." Beneficial's employees were told of the decision Tuesday morning.

"Beneficial is and will remain well capitalized and fully able to meet its obligations to current policyholders," said Mark Willes, Deseret Management's president and chief executive officer. "However, like virtually all life insurers, Beneficial has been impacted by the financial-market meltdown.

"When you combine our lack of scale with the economic impact of the market meltdown, it becomes clear that the limited economic opportunity does not justify the risk of potential future losses."

Kent Cannon, Beneficial's chief executive officer, told the Deseret News that the company will continue to serve its existing policyholders and "do right by our employees and agents, many of whom have ties with Beneficial going back generations."

All employees being laid off were informed Tuesday. Sixteen were let go immediately, with the rest to leave in stages until October, DMC spokesman Kent Jarrell said in an e-mail to the Deseret News.

"This is clearly a very difficult thing to deal with," Cannon said. "The decision to downsize was not easy, and we are committed to a responsible and orderly process."

Willes said told the Deseret News that Beneficial will stop accepting applications for new policies Aug. 31.