The Hartford said Monday it has agreed to purchase Aetna’s life and disability insurance business. The deal, valued at $1.45 billion, is expected to close early next month. The move will make The Hartford the second largest U.S. carrier of group life and disability insurance after MetLife.
“The transaction provides a unique and accretive opportunity for The Hartford to become the second largest group life and disability insurer, an important business for The Hartford with a stable risk profile, attractive returns and strong long-term growth prospects,” said The Hartford’s Chairman and CEO Christopher Swift. “The combination of these two businesses strengthens our position as a leader in the large employer market and increases our presence among midsize employer clients.”
Swift says the acquisition will be positive because of the complimentary nature between Aetna and The Hartford models, noting that the synergies around its claim systems as well as Aetna’s digital capabilities making the integration “natural.”
“Our claims organization continues to use data and advanced analytics across workers’ compensation and disability to drive better outcomes for customers in both business lines,” added Doug Elliot, The Hartford’s president. “As the nation’s second largest workers’ compensation insurer, and now, the second largest group disability insurer, this transaction increases our competitive differentiation and potential for future product offerings for absence management.”
With the expanded data and advanced analytical capabilities, The Hartford’s claims organization will also be able to drive better recovery outcomes for customers in both workers’ compensation and group disability businesses.
The Hartford says it will integrate the absences and disability administration platforms with robust web portal and mobile capabilities with text message integration.
The Hartford will also acquire a majority of Aetna’s approximately 1,800 Group Insurance employees as part of the deal, as well as its digital assets and integrated absence-management platform. In addition, the deal includes an exclusive collaboration under which Aetna will offer The Hartford’s group life and disability products through Aetna’s sales team.
Earlier this year, Aetna abandoned its attempt to acquire fellow insurer Humana after a federal judge blocked the transaction on antitrust grounds.
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