Assurant announced a strategic decision to double-down on its property/casualty specialty insurance efforts, while considering possible sales of its employee benefits and health segments.
“Following a strategic review of its business portfolio, the company will focus its resources on niche housing and lifestyle protection offerings where it holds market leading positions to consistently generate specialty returns long term,” Assurant said in a statement on Tuesday, explaining that the company will consider alternatives for the health and employee benefits parts of its business.
“Absent a sale of the health business segment, the company plans to substantially complete its exit from the health insurance market in 2016,” the statement said.
Assurant President and CEO Alan B. Colberg explained: “We have established significant momentum in our specialty housing and lifestyle protection businesses where we have developed strong competitive positions in the U.S. and select international markets.
“Recognizing the wide array of additional growth opportunities in these areas, we will concentrate resources where we can generate sustainable specialty returns as we pursue our aspirations of outperformance,” he said.
According to the April 28 media statement, the company will broaden the integrated protection products and services from its Assurant Specialty Property and Assurant Solutions business segments to help customers protect against risk, including offerings such as mobile and other extended service contracts, lender-placed insurance, multi-family housing, mortgage solutions, vehicle service contracts and pre-funded funeral plans.
“The health and employee benefits business segments possess differentiated capabilities in their respective markets, but we do not believe they can meet our return targets at the pace we require,” Colberg said, noting that while the decision was difficult, Assurant believes that the two segments could be “strong assets for new owners that are focused more exclusively on health care and employee benefits.”
Colberg is one of 16 P/C industry leaders who will be featured in a special Carrier Management report on insurance industry innovation later this month. Among other things, Colberg described one particular innovation in the lifestyle protection segment— JUMP, a premium handset upgrade launched in partnership with T-Mobile in 2013. He also discussed how Assurant leaders engage employees and help them understand the thinking behind strategic decisions.