Insurer Nationwide said it has completed the purchase of Allstate’s Group Health business segment for $1.25 billion.
The acquisition was announced in January.
Nationwide said the purchase will strengthen and diversify Nationwide Financial’s portfolio, expanding the company’s ability to sell stop loss insurance—which protects employers who self-fund health insurance plans from excess losses—to small businesses.
“This acquisition expands the capabilities, specialized expertise and strong partnerships of our financial services organization, positioning our company as a leading provider in the employer stop loss industry,” said Nationwide CEO Kirt Walker, in a statement, adding that “enhancing our employer stop loss segment helps us continue to meet the needs of business owners today and into the future.”
Allstate Corp. CFO Jess Merten said the sale is expected to generate a financial book gain of about $500 million.
The deal with Nationwide follows last year’s sale of Allstate subsidiaries that provide employer voluntary benefits to StanCorp Financial Group in a $2 billion cash deal.
“Selling the Group Health and Employer Voluntary Benefits businesses for a combined $3.25 billion demonstrates the strength of these businesses and Allstate’s strategic approach to capital management,” said Allstate CEO Tom Wilson.
Lindsey Murray, the former chief operating officer of Allstate Health, has joined Nationwide and will lead the newly formed Nationwide Group Benefits segment.
Topics Profit Loss
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