CIGNA Corp. has agreed to pay $1.5 billion in cash to buy the health insurance arm of Great-West Life & Annuity Insurance Company.
Great-West Healthcare, a part of Great-West Life & Annuity, Greenwood Village, Colo., provides medical, dental, vision, life and disability coverage for 2.2 million U.S. residents in 5,200 U.S. employer groups.
Great-West HealthCare is particularly active in administering health coverage for small self-insured health plans.
The CIGNA deal does not include the Great-West Life & Annuity retirement services and individual markets businesses, which provide retirement plans and life insurance for 4 million U.S. residents. The businesses have about $127 billion in assets under management, according to Great-West Life & Annuity.
Great-West Life & Annuity is a unit of Great-West Lifeco Inc., Winnipeg, Manitoba., which in turn, is a unit of Power Corp. of Canada, Montreal.
CIGNA and Great-West Life & Annuity hope to complete the deal, which is subject to approval by several regulatory agencies, by June 30, 2008.
News of talks about the deal surfaced in the Hartford Courant in early November.