Great-West is selling the Canada Life U.S. group operations, which it acquired through its July 2003 acquisition of Canada Life, because it wants to put the capital from the sale in its own U.S. health and retirement services operations, according to Great-West Lifeco President William McCallum.
The deal includes the Canada Life group life, group disability and group dental operations but not a unit that protects self-funded health plans against excess losses.
Completing the deal should help Jefferson-Pilot add $349 million in annual group life premiums, $180 million in annual group disability premiums and $50 million in annual group dental premiums, according to Jefferson-Pilot President Dennis Glass.
The Greensboro, N.C., company also will get 76 Canada Life sales representatives.
Once Jefferson-Pilot folds the Atlanta-based Canada Life operations into its own Omaha-based Jefferson Pilot Benefit Partners unit, the combined benefits unit should have about 160 sales reps and more than $950 million in in-force premium revenue.
Robert Bates, president of Jefferson Pilot Benefit Partners, will be responsible for combining the Canada Life operations with the Benefit Partners operations.
Jefferson-Pilot plans to keep an operations center in Atlanta, but the company is hoping that it can squeeze $20 million in savings from the acquired business within 12 months of completing the acquisition. Jefferson-Pilot also is hoping it can use the Canada Life benefits operations in New York as a base for entering the New York benefits market, Bates said.
Reproduced from National Underwriter Edition, January 16, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
