(Bloomberg) – CNA Financial Corp. agreed to sell a life unit to Wilton Re Holdings Ltd. at a loss as the insurer majority-owned by Loews Corp. narrows its focus to property-casualty coverage.
Proceeds from the divestiture of Continental Assurance Co., which has liabilities tied to group annuities and structured settlements, will be about $615 million, the Chicago-based insurer said today in a statement. The deal will reduce earnings this quarter by about $220 million, CNA said.
CNA is among insurers retreating from life units as low interest rates limit returns. Allstate Corp. and Hartford Financial Services Group Inc. have struck deals to divest units as they increase their reliance on property-and-casualty sales. CNA primarily sells coverage to commercial clients.
“This transaction is another step in the execution of our strategy to create a more focused P&C business capable of delivering consistent performance,” Thomas Motamed, CNA’s chief executive officer, said in the statement.