The Hartford Financial Services Group, one of the leading sellers of group life and disability insurance in America, has acquired 100,000 group life and accident policies from Union Labor Life Insurance for $29 million.
The purchase is a strategic acquisition by The Hartford’s group life and accident insurance businesses, according to Richard Mucci, executive vice president of The Hartford’s Group Benefits Division. The Hartford sells group life and accident policies through Hartford Life Insurance and Hartford Life and Accident Insurance.
This transaction adds scale to The Hartford’s growing group life and accident businesses, improves our leadership position in the market, and helps make us more competitive from a cost standpoint, Mucci said.
The proceeds from the transaction increased Union Labor Life’s capital and surplus to its strongest level in 10 years, at approximately $125 million, as of January 31, 2005, according to Mark Singleton, senior vice president and CFO of Ullico, Union’s parent company.
The transaction is a component of the final phase of Ullico’s two-year turnaround plan designed and executed by the new management team. The team was brought in during 2003 to restore operational integrity and fiscal responsibility, which involves selling off unprofitable business, as in this transaction.
This is a good deal for both Union Labor Life and The Hartford, Singleton said. We were able to strengthen our balance sheet and provide a good home for this stable, well performing block of policies.
The transaction with The Hartford is a component of a broader partnership between Ullico, UnionSecure, and The Hartford. UnionSecure, a joint program between Union Privilege and Ullico Inc and underwritten by the issuing companies of The Hartford, develops and markets life and accident insurance through direct mail to individual union members.