MILWAUKEE - Assurant, Inc. announced
Wednesday it will close its health insurance division
with layoffs of 300 people occurring this summer.
The company said Wednesday it had
concluded a comprehensive review of strategic
alternatives for its health business and will exit the
health insurance market and increase its focus on
housing and lifestyle specialty protection offerings.
Assurant said it anticipates the total
costs from leaving the health insurance market will be
$175 million to $250 million. This includes premium
deficiency reserves, severance and retention, contract
and lease terminations and other transaction costs.
“Our decision to exit the health
insurance market enables us to sharpen our focus on the
housing and lifestyle markets, where we see the greatest
opportunity for profitable growth. After a thorough
review of alternatives for our health business, we
believe the actions announced today allow us to uphold
our commitments to policyholders while freeing up
resources in 2016 to support our capital management
strategy,” said Assurant President and CEO Alan B.
Colberg in a statement.
“We remain strongly committed to ensuring
a smooth and orderly transition for our customers,
agents and employees.”
According to the announcement, Assurant
will immediately begin to wind down its major medical
operations and has reached an agreement in principle to
sell certain business lines and assets to National
General Holdings Corp., subject to final documentation
and regulatory approval.
Assurant, according to the release,
expects to exit the health insurance market by the end
About 300 people will be laid off out of
approximately 1,700 positions at Assurant Health this
summer. The company stated it will consider affected
employees for open positions within Assurant, based on
qualifications. Those unable to find another position
will be offered severance, outplacement and job
According to the announcement, National
General Holdings Corp., a specialty personal lines
insurance holding company, will acquire Assurant
Health’s supplemental and small group self-funded
product lines and certain other assets including a
proprietary small group sales channel.
Assurant Health will continue sales of
its supplemental and small group self-funded products as
it finalizes the terms of the transaction with National
General Holdings Corp. At the same time, as part of the
wind-down process, Assurant Health will cease sales of
its individual major medical, small group fully-insured
and short-term medical health insurance policies Monday
and will not participate in open enrollment under the
Affordable Care Act for 2016.
There will be no changes to Assurant
Health policies or benefits currently in effect.
Affected customers will receive letters
from Assurant Health starting next week and can learn