NU Online News Service, May 30, 3:17 p.m. – StanCorp Financial Group Inc. made an offer for the group insurance business of the Teachers Insurance and Annuity Association partly because it received an invitation.
TIAA, half of the Teachers Insurance and Annuity Association-College Retirement Equities Fund, New York, asked StanCorp to participate in a limited auction process, according to company spokeswoman Tiana Tozer.
Executives at StanCorp, Portland, Ore., the parent of Standard Insurance Company, also believe the deal is in keeping with the company’s philosophy of doing a few things well. Rather than being “all things to all people, we have areas of concentration,” Tozer says. “We’ve chosen to grow our business in niche markets where we have expertise, including group disability and group life.”
StanCorp announced plans Wednesday to acquire the TIAA group life and group disability units through a $75 million reinsurance arrangement.
The company also said it would pump in another $130 million to increase the TIAA group units’ capital levels.
TIAA started the group life and disability operations in the 1950s. The units now manage 1,800 group contracts that cover 650,000 insured lives and generate $180 million in annual premium revenue.
Completing the deal should increase StanCorp’s annual premium revenue about 15%, according to company figures.