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April 28, 2015 at 01:25 PM
Assurant Inc. (NYSE:AIZ) says it is looking for buyers for its health insurance and employee benefits units.
One way or another, Assurant wants to get out of the health insurance market by 2016, the company says.
The company plans to release first-quarter results Tuesday.
The company as a whole will report about $40 million to $50 million in net operating income for the quarter. The benefits unit has been doing about as well as the other units, but the Assurant Health unit will report about $80 million to $90 million in net operating losses, the company says.
About half of that loss is the result of a reduction in expected recoveries from the three Patient Protection and Affordable Care Act (PPACA) risk-management programs, and about half reflects high claims on PPACA-compliant policies in force during the first quarter, the company says.
Whether Assurant can sell Assurant Health or not, it will begin the process of leaving the health insurance market this year, and will not participate in the open enrollment period for 2016, the company says.
“The company’s exit will be substantially complete in 2016,” the company says.
Assurant says it wants to focus on its mortgage insurance and personal property protection insurance businesses.
Alan Colberg, Assurant’s president, said the company has decided to sell the health and benefits units because it does not believe the units can increase returns as quickly as the company requires.
