Assurant Inc. (NYSE:AIZ), a company made up in part of insurance companies that helped create the modern U.S. major medical market, says it will stop taking applications for new individual major medical coverage, short-term health insurance and insured group coverage June 15.
The company’s insurance units will withdraw from the Patient Protection and Affordable Care Act (PPACA) public exchange system in 2016.
See also: Assurant dishes on PPACA effects
Assurant says it will make good on obligations related to in-force coverage.
“The company will meet all claims, benefits, provider payments and agent commission responsibilities during these transitions,” the company says. “There will be no changes to Assurant Health policies or benefits currently in effect.”
Assurant included that pledge today in a description of its plans for getting out of the medical insurance business. The company announced it was leaving the health insurance and employee benefits markets in April.
Assurant executives said at the time that they were confident that they could sell the benefits unit but were not sure whether they could sell the health insurance unit.
In related news, Assurant says it:
Has agreed to sell its program for small self-insured groups, its supplemental health benefits operations, and its small-group sales channel to National General Holdings Corp. (Nasdaq:NGHC), a property-casualty insurer.
Will send letters to customers affected by the Assurant Health unit changes beginning the week of June 15.
Has about 1,700 positions at Assurant Health. The first phase of job reductions will occur this summer and affect about 300 positions. “Affected employees will be considered for open positions within Assurant, based on qualifications,” the company says. “Those unable to find another position will be offered severance, outplacement and job readiness support.”
Alan Colberg, Assurant’s president, said in a statement that leaving the health insurance market will help the company sharpen its focus on the housing and lifestyle markets.
“We remain strongly committed to ensuring a smooth and orderly transition for our customers, agents and employees,” Colberg said.