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Assurant Divests Certain Health Insurance Business for $14M

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Assurant, Inc.AIZ has divested certain assets and business lines from its Assurant Health business to National General Holdings Corp. NGHC for $14 million. The divestment is in sync with its efforts to restructure business for long-term growth.

The transaction included selling a proprietary small group sales channel, supplemental and small group self-funded product lines and certain assets from Assurant Health.

The divestiture is helping Assurant to exit Health insurance businesses to focus Housing and Lifestyle Protection. Also, the divestiture helped Assurant take a step ahead to realign its business into a profitable and sustainable one.

In sync with its business restructuring efforts, last month Assurant inked a deal with Sun Life Financial Inc. (SLF) to sell its employee benefits business to Sun Life Financial SLF for $940 million.

Moreover, the transaction is expected to leverage Assurant's financial flexibility and boost its capital base. With additional cash balance, the company can focus more on returning value to its shareholders as it has been consistently engaged to use its cash balance and cash from operations to repurchase shares, of late. The company also raises dividend from time to time. Additionally, a low debt-to-capital ratio reflects a solid capital position.

Precisely, a strong franchise, consistent cash flow generation, moderate debt ratio and a robust Solutions segment, business restructuring, disciplined capital management strategy are expected to drive long-term business growth for Assurant.

Zacks Rank and Stocks to Consider

Assurant presently carries a Zacks Rank #3 (Hold). A better-ranked stock from the multi line insurance space is Assured Guaranty Ltd. AGO sporting a Zacks Rank #1 (Strong Buy).

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ASSURANT INC (AIZ): Free Stock Analysis Report

ASSURED GUARNTY (AGO): Free Stock Analysis Report

SUN LIFE FINL (SLF): Free Stock Analysis Report

NATIONAL GNL HL (NGHC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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